BMW’s Struggles: Climate Policy, EV Leadership, and Strategic Contradictions

BMW, a key player in the global automotive industry, finds itself at the crossroads of significant challenges. While it has pioneered in areas of sustainable innovation, such as the launch of the i3, the company has also been criticized for actions that appear misaligned with its public commitments to electrification and climate action. BMW’s financial struggles, lobbying efforts, and leadership rhetoric present a complex narrative of ambition tempered by hesitation.

Financial Challenges and Market Performance

In the first nine months of 2024, BMW delivered 1,754,157 vehicles globally, marking a 4.5% decline compared to the same period in 2023. These setbacks led BMW to revise its financial forecasts, citing delivery disruptions and technical issues, including problems with a supplier’s Integrated Braking System. Compounding its difficulties, BMW experienced a significant 29.8% year-over-year drop in vehicle sales in China during the third quarter of 2024. This market, crucial to BMW’s global strategy, has seen growing dominance by local automakers, particularly in the electric vehicle (EV) sector, which now eclipses BMW's market share with cost-effective and innovative offerings.

EV Strategy: Early Promise and Strategic Missteps

BMW's early leadership in EV innovation began with the groundbreaking i3 in 2013. The i3’s lightweight carbon-fiber design and urban-centric electric platform set a new standard for sustainable automotive engineering. However, its high price limited its market penetration, and by the time Tesla introduced the more affordable Model 3, BMW’s efforts appeared stagnant. Instead of proactively gearing up for competition, BMW continued with its conventional business model, allowing rivals to gain substantial market share.

A key turning point came in 2019 when BMW replaced its EV-focused CEO, Harald Krüger, with Oliver Zipse. Under Zipse’s leadership, BMW adopted the CLAR multi-engine platform, which accommodates internal combustion engines (ICE), plug-in hybrids, and EVs on the same assembly lines. While this strategy offered production flexibility, it diluted the performance and efficiency of BMW’s EVs compared to purpose-built platforms like Tesla’s. Critics argue this cautious, incremental approach undermined BMW's ability to compete effectively in the rapidly evolving EV market.

Lobbying and Climate Policy Contradictions

BMW's actions in climate policy have drawn significant scrutiny. According to a 2021 analysis by InfluenceMap, the company actively lobbied against ambitious European Union climate initiatives, including stricter CO? emission standards and the proposed phase-out of internal combustion engines. By 2024, further research from InfluenceMap revealed that BMW, alongside other major automakers, engaged in lobbying efforts that hindered the global transition to electric vehicles. Notably, Tesla was the only automaker in the study that did not oppose policies promoting EV adoption. BMW’s lobbying expenditures totaled $800,000 in 2021, highlighting its active role in shaping policy debates.

These actions paint a stark contrast with BMW’s public rhetoric on sustainability and electrification. While the company has committed to making half of its global deliveries fully electric by 2030, its lobbying practices suggest resistance to policies that would expedite the transition to a low-carbon future.

Leadership and Technology Diversification

BMW’s CEO Oliver Zipse has publicly expressed skepticism about rapid regulatory changes, particularly the EU's proposed ban on new petrol and diesel vehicles by 2035. Zipse warned such policies could deepen Europe's reliance on Chinese battery technology, raising geopolitical and resource concerns. Instead, he has advocated for a technology-agnostic approach, emphasizing alternative solutions such as e-fuels and hybrid technologies alongside EVs. This diversified strategy reflects a cautious stance on fully committing to electrification, aligning with BMW’s broader operational focus on flexibility and incremental innovation.

Conclusion: The Price of Hesitation

BMW’s financial struggles, strategic indecision, and lobbying activities illustrate the tensions between maintaining legacy business models and embracing the future of mobility. Its reliance on multi-engine platforms and resistance to bold climate policies have left it trailing behind competitors like Tesla and Chinese EV manufacturers, which have embraced dedicated EV platforms and aggressive pricing strategies.

To secure its position in the rapidly evolving automotive landscape, BMW must align its rhetoric with action. This includes committing to purpose-built EV architectures, investing in charging infrastructure, and adopting forward-thinking policies that support electrification. Without these radical shifts, BMW risks eroding its reputation as a leader in innovation, becoming a cautionary tale of how hesitation and contradiction can undermine even the most storied of brands.