1,665 i3 delivered to customers worldwide in Nov 2014

at least that's the difference between last month's and this month's figure...

http://www.bmwgroup.com/bmwgroup_prod/e/0_0_www_bmwgroup_com/investor_relations/corporate_news/news/2014/vertriebsmeldung_november2014.html

I'm impressed they managed to ship nearly 1,200 i8s since the summer. Imagine the cash flow from that is quite a lot. £100,000,000!+

I bet they already recouped a lot of the development cost.

My goodness those are small sales for a car that has been out for so many months and I believe might be a decline from previous months. Could this be why the head of R&D just left BMW? All that investment and such a tiny return, this is an enormous gamble for BMW.

BTW, I see that Tesla registered 2,391 far more expensive vehicles in the same month as a comparison.

nowtta60 said:

I'm impressed they managed to ship nearly 1,200 i8s since the summer. Imagine the cash flow from that is quite a lot. £100,000,000!+

I bet they already recouped a lot of the development cost.

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Like most "halo" cars, they probably lost money on everyone they sold....... The i3 is the one that is supposed to be the profit center. Not much profit in only 1661 sales worldwide and gasoline under $3 a gallon will not help either. No wonder the deal with CARB for ZEV credits was made: they knew they might need the extra income if the program was a slow starter.

With the new factories, the R&D expenses, and the introduction costs (marketing and program startup costs) I would not be surprised if, at this point, the only profit on an i3 is from the CARB credits. It is going to take a while and much, much larger sales figures before BMW moves into profit on the iProgram .

Re the 2k + Teslas: that's about 2.5% of BMW's overall output in vehicles per month. Let's not forget that this is an emerging market.

I think 1.5k - 2k vehicles per month is great.

It's not like as if there are thousands queuing for EVs outside dealerships. The problem is not sales figures, it's mindset.

Don't forget there's been a 2-3B development effort for this car. Assuming a minimum 10% ROE is required, BMW needs 200-300M in net profits to make it pay. Assuming an optimistic 4,000 net profit per car, they have to sell 500,000-750,000 i3s

I'm betting BMW is losing a lot of money on each car. However, it's probably viewed as a technology learning process with the carbon, battery, electric motor etc finding it's way into the whole product line eventually

Ron

cove3 said:

I'm betting BMW is losing a lot of money on each car. However, it's probably viewed as a technology learning process with the carbon, battery, electric motor etc finding it's way into the whole product line eventually

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We're talking about a company that produced 1.9m cars so far this year. As you say, the 2bn EUR investment for something that currently represents less than 1% of sales has to be a future investment.

Also, what would BMW's shareholders say if the company would make no efforts to move into new spaces? Upcoming EU regulations on emissions and competitive pressure mean that this investment was necessary.

We currently see the same in the IT sector. Traditional IT software businesses like IBM, Oracle, Microsoft, SAP etc have to shift minds and money to cloud technologies. In most of their current balance sheets, cloud-relevant revenues are minute. Yet they still have to make the leap into these areas in order to avoid irrelevance.

In a way, upcoming businesses like Tesla have it much easier, as they don't have to overcome restrictions and legacies like traditional car manufacturers have.

It's easy for Teslaristis to be high and mighty about their cars, but they have yet to come up with an affordable EV at scale. Now scale is something that BMW and VW can do. You don't have to be first - it's more important to be best. For example, VW were very late in the MPV market, yet they overtook most competitors in the european market with the Touran model.

I think most of us (including myself) on this forum don't realise how early days for EVs it really is.

People seem to forget that CFRP was the primary goal (at least in my mind), and that is already starting to be incorporated into more and more of the vehicles BMW has under development (the upcoming 7-series has a bunch of it from the leaked rumors, and others will as well). This weight shedding, strength increasing, fuel saving building material is (to BMW) a critical component to meeting the upcoming standards.

Given the lack of advertising in the USA for the i3, and the comments I get (BMW makes an electric vehicle?!) selling what they are right now is pretty good. They felt the USA would be one of their bigger markets, and it appears so, probably 2/3'rds of that world-wide total is in the USA.

I do not know how much BMW is advertising the i3 in other parts of the world, but when you are making them about as fast as you can sell them, why would you advertise? People that HAVE bought them in Europe have been complaining about the delay in order to delivery, so would you advertise and make the wait longer? They are selling more than they planned for, have put in orders to expand the production line equipment (but that takes many months), ramped up production of the CF, increased shifts at the factory, and invested another $100M to further expand the CF production.

Doom and gloom is, IMHO, misplaced and uninformed. CFRP is and will continue to expand into the structure of all upcoming BMW models, decreasing weight, giving the opportunity to maintain performance with smaller engines, or, significantly decrease energy consumption, and probably both options will be available. No other modern material currently offers that possibility, and the research to build the I-cars was critical to their learning curve. Call it an R&D project, the payoff can take awhile, but it is real.

Good points, Jim.

Very well said Jim, there is a lot of truth in there. I too believe the i3 is an R&D project nearly as much as it is a car for BMW. Nearly every step of development and manufacturing for the i3 is different than it is on any other BMW vehicle. This was never meant to be a high volume car. The lessens learned from making the i3 will pay dividend in future models, both in the i brand and in BMW proper.

I think BMW have purposely only been running 1 production line. They'd prefer a longer wait for customer while the first cars release get their bugs ironed out. They might even be holding back a few cars this month just to wait for things like the KLE issues and some air con issues I've seen to pass thru design testing and be ready to fit to more cars. Maybe not.