BMW to replicate Mercedes by offering LFP batteries going forward
Just one year ago, when BMW presented the iX3 in Munich, the company made it clear it wasn't ready to offer the more affordable LFP chemistry across Western markets, as it wasn't prepared to compromise on charging speed, robustness in various climates, or range for its premium consumers.
However, this morning, when questioned on the topic during the Q3 results call, if the Bavarian company would now reconsider that, Nedeljković said they are now prepared to offer the chemistry, replicating their Chinese strategy, where the IX3 will be offered with LFP cells from this month, more in-line with their Chinese peer strategies, enabling them to become more price competitive while remaining profitable.
In Europe, however, any LFP offering is likely to support higher profit margins rather than pursue weaker pricing, as Volkswagen and premium peer Mercedes did with the rollout of the chemistry in the ID.3 refreshed NEO and CLA, respectively.
LFP does, however, offer a potential tool to react to a more price-competitive market with Chinese premium OEMs from the likes of Xiaomi and Li Auto set to enter the market from 2027, or to offset weaker profits from China and regain traction in pursuit of a stronger profit margin, which isn't expected to return to the premium margin corridor of 8-10% until the early 2030s.
Nedeljković noted that LFP wouldn't be offered on a generic portfolio basis and not across all segments.
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Scope: Western Europe's 18 Markets: EU Member States prior to the 2004 enlargement, plus EFTA markets Norway, Switzerland, Iceland, plus UK – accounting for 90% of the enlarged European region.
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