BMW Ends Focus on Electric Vehicles in Favor of Self-Driving Cars

BMW’s successful “Project i” was intended to develop an entire range of electrified vehicles. The results were the Mini E, BMW 1-series Active E, and much later, the i3 EV/PHEV, plus a i8-plug-in hybrid. With the latter of those cars coming after BMW had organized the group into the iDivision, the stage was set for BMW to be a leader in EV vehicle development. Although auto analysts have been waiting for an announcement about the next “i” model, it appears that BMW has turned its focus elsewhere. BMW has now revealed it is relaunching its division to focus on developing autonomous driving technologies.

In an interview with Reuters, BMW board member Klaus Froehlich said that the company’s future-think division would turn its direction to competing in the hot autonomous driving space. The shift in plans explains why four of the top executives from the iDivision recently departed the company. It was widely assumed that the iDivision was secretly working on an i5, electrified four-door sedan to compete with the production version of the Porsche Mission E electric sedan. BMW also seemed to be intent on competing with Tesla in the EV space. However, other than the i8 roadster, it would be unwise to expect any new electrified models from the division.


Sales of the i3, while once promising, have ultimately been disappointing. Of course EV was once the hot trend, and the newest thing is autonomous driving, which has captured the collective attention and ardor of the automotive industry. Froelich had much to say about the trend, suggesting that autonomous driving “i” cars might let BMW launch its own ride-hailing service. In other words, BMW wants to compete with Lyft and Uber, of all things.

The ride-hailing trend is also on the minds of the auto industry, with several traditional carmakers entering the competition to develop ride-sharing and ride-hailing partnerships. General Motors is teaming with Lyft and Maven; Volkswagen is working with Gett, and Toyota has partnered with Uber, with all parties intending major investments and partnerships.

Just as automakers were once concerned that consumers would begin clamoring for electrified vehicles, they are now convinced that drivers will depart from the traditional car ownership model en masse. Although the popularity of ride-hailing services is undeniable, their rise is not siphoning off huge numbers of drivers.

As for the “i” vehicles already in production, the fortunes of the i3 are telling. It recorded just 25,000 sales in 2015, far below BMW’s goals for the zero-emission vehicle. This pales in comparison to Tesla’s pre-orders for the Model 3, which is the i3’s direct competitors. In order to boost sales of the i3, BMW is increasing its battery range. The car will now get an improvement of 50 percent battery range in 2016.

A source also said that BMW would still release a newer version of the i3 EV sometime in 2018. The source told Reuters that the new version would be “a sportier brother for the i3.”

Meanwhile, on the autonomous driving front, the flagship model should arrive in 2021. As a result, the company is increasing the number of software and technology contractors and employees from 20 precent to somewhere around 50 percent.

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