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BMW says they can't mass produce EVs until 2020

slam

Member
Jun 11, 2014
23
13
Lam
I think it's more that they have realized they cannot use a lot of their old ICE factory infrastructure to build EVs and that this will require a very high capital investment to retool their lines. Because of that, they're warning that their profit margins won't be huge until 2020 (which is really less than 2 years away).
 
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Phrixotrichus

Member
Jul 31, 2017
585
705
Germany
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metier

Member
Apr 5, 2016
119
89
Houston Texas
Fortunately there are investors who understand current gross profit (25%) and investment for future growth.

But when your net profit is losing you 700 million a quarter how long are those investors going to stick around, specially when you can not hit any of your production numbers? How long are they going to believe the story?
 

SabrToothSqrl

Active Member
Dec 5, 2014
3,810
3,226
PA
2020 is when we will finally have turn-signal-free-BMW-branded electricity. Then and only then can we fill our cars with the premium electrons (at the premium pricing) BMW deserves ;)
 
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Phrixotrichus

Member
Jul 31, 2017
585
705
Germany
Fortunately there are investors who understand current gross profit (25%) and investment for future growth.
Fortunately there are also enough investors who understand that this business approach doesn`t magically always work just because it worked for someone like Bezos.
It´s high risk high reward, but enthusiasts tend to completely ignore the "risk" part ...
 
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McRat

Well-Known Member
Jan 20, 2016
5,771
6,077
LA
This is why Toyota is moving very slowly as are many other car companies. Some have not started selling any BEVs yet. BMW does sell BEVs, albeit at a loss.

Nobody is making profits by selling electric cars yet. Any press releases to the contrary are misleading.

The companies that can hold back longer will improve their profits the most.

The fact that Mary Barra can keep the GM board happy while dumping billions into advanced propulsion and AV tech is a miracle. You'd think they would have replaced her already.
 

mspohr

Well-Known Member
Jul 27, 2014
10,053
12,626
California
Fortunately there are also enough investors who understand that this business approach doesn`t magically always work just because it worked for someone like Bezos.
It´s high risk high reward, but the enthusiasts kinda tend to completely ignore the "risk" part ...
The legacy automakers all seem to have adopted this slow strategy. Their risk is that they have ceded the market to Tesla.
 

mspohr

Well-Known Member
Jul 27, 2014
10,053
12,626
California
This is why Toyota is moving very slowly as are many other car companies. Some have not started selling any BEVs yet. BMW does sell BEVs, albeit at a loss.

Nobody is making profits by selling electric cars yet. Any press releases to the contrary are misleading.

The companies that can hold back longer will improve their profits the most.

The fact that Mary Barra can keep the GM board happy while dumping billions into advanced propulsion and AV tech is a miracle. You'd think they would have replaced her already.
The risk of holding back is loss of market. (Kodak, Xerox, etc)
 
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McRat

Well-Known Member
Jan 20, 2016
5,771
6,077
LA
China will wipe out the US EV industry if permitted. They have cheap energy from their coal (for aluminum and steel production), the government allows dumping, and they are trying to corner the market on critical materials for EVs.

Why haven't the Chinese done it? Not even the Chinese can endure the amount of losses necessary to wipe out all competition in the EV market. IIRC, the CODA was Chinese. It was the first EV I drove (pre-release). They could not do it.

The Chinese now have all the technology required, mostly stolen. The financial aspect just isn't feasible yet.

2020 will certainly be a challenge. That's about when the Chinese will make their move.
 
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mspohr

Well-Known Member
Jul 27, 2014
10,053
12,626
California
But when your net profit is losing you 700 million a quarter how long are those investors going to stick around, specially when you can not hit any of your production numbers? How long are they going to believe the story?
As long as Tesla keeps growing and producing, investors will stay. If it gets to the point where they can't raise more capital, I guess they will just have to stop investing in new stuff and milk their 25% profit margin on existing production.
 

McRat

Well-Known Member
Jan 20, 2016
5,771
6,077
LA
The risk of holding back is loss of market. (Kodak, Xerox, etc)

The risk of jumping the gun is also severe. Xerox invented the mouse before folk wanted it, and their 820's had built in networking. Too early. IIRC Kodak invented digital cameras when the tech was still too expensive for the market. Everybody says it was to protect the film division, but the camera was about $4000 in today's dollars. Kodak ended up producing digital camera under the Apple branding. Which were also a failure two decades later. Still too early.

I purchased a Sony that took VGA (640x480) pictures onto a floppy in the late 1990's almost 25 years after Kodak invented the digital camera. It was $900 ($1,400 in 2018 dollars) and was still a failure.

Whoever tries to attack the EV market at the right time with bloodlust will be the winner. This occurs again and again in industry. Timing is more important than innovation. Or Farnsworth TVs would be a household name, and Amana would be the microwave of choice.

Facebook was not the first social networking app, and Google was a latecomer to search engines. AOL and Alta Vista are dead.
 
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