Battery self-research and self-production is a trend of today's automobile companies to transform in the direction of new energy. Of course, not all brands follow the trend. That includes BMW, which doesn't seem to have plans to develop its own batteries despite doubling sales of electric vehicles.
Daimler and Volkswagen are currently or have already invested heavily in their own battery factories to achieve battery self-sufficiency.
In fact, this atmosphere began when the electric vehicle market was in full swing. As the battery with the highest proportion of the cost of electric vehicles, it is the key to electric vehicles. Since battery performance represents the performance of electric vehicles, batteries achieve self-sufficiency, which can determine which automotive company is in the head position of the automaker, and reduce costs through large-scale mass production to achieve high penetration.
However, not all brands are emulating Daimler and Volkswagen. Instead, a large number of automakers still rely on external battery manufacturers such as LG, Samsung, SK, CATL, and Northvolt. So why do these automakers choose to continue buying batteries instead of producing themselves?
BMW, one of the fastest brands to start the era of electric vehicles, has received more than double the orders for electric vehicles compared to last year. Starting from the i4, the proportion of electric vehicles in BMW's product portfolio such as iX and iX3 has been increasing. Still, BMW has announced that it has no plans to produce batteries on its own.
"The reason BMW isn't in a hurry to produce its own batteries is because we don't know which technologies will be applied to electric vehicles in the next 10 to 15 years," said Nicholas Peter, BMW's finance director. Therefore, while lithium-ion batteries are currently the main concern, all-solid-state battery technologies are already being developed and commercialized.
Of course, there are also many problems within BMW. First, the BMW Workers' Association insists that expanding the battery factory could create a lot of jobs. But in fact, the transition from internal combustion engines to electric vehicles is a large-scale application of intelligent manufacturing, which will reduce the number of workers. Therefore, BMW still announced that it does not intend to establish a gigabit battery factory for the time being based on the above situation.
Of course, a more important reason why BMW has not built its own factory is BMW's brand influence and relationship with third-party battery suppliers. One of the crises that swept through the auto industry last year was a drop in production due to a shortage of semiconductors and batteries. In fact, in this crisis, sales of many brands have declined. However, in the past five years, BMW's sales have not been greatly affected, but have surpassed Mercedes-Benz.
The reason for this is BMW's close relationship with its battery and semiconductor partners. In fact, the self-sufficiency of batteries and semiconductors is also a long-term threat to the partners currently supplying batteries and semiconductors. BMW's insistence on third-party procurement is also a firm tying of itself with third-party companies.
In addition, because BMW is a luxury brand and has a considerable brand premium, although the cost of purchased batteries is not low, it will certainly be higher than the cost price of its own production, but because BMW's brand premium is relatively high, it will not affect BMW's profitability.
So whether it is like Volkswagen, Mercedes-Benz to build their own battery factory to produce batteries, or like BMW, has been purchasing products from third-party battery companies. Which way is good is still difficult to determine in the end, and perhaps the only thing that can give the answer is time.