FRANKFURT -- BMW's i subbrand of electric and plug-in hybrid cars saw sales 23 percent plunge in the first quarter while it also suffered the defections of key executives to a Chinese startup.
Sales of the subbrand's two models, the i3 city electric car and i8 plug-in hybrid supercar, dropped to 5,100 units, the worst three-month period for the subbrand in seven quarters.
BMW CEO Harald Krueger told reporters on Tuesday that the decline was in part driven by customers in Germany who had decided to delay their purchase until the government agreed ob subsidies to spur demand.
The German government plans to offer electric-car buyers a 4,000-euro incentive while buyers of plug-in hybrids will get a discount of 3,000 euros.
Krueger said customers were also waiting for an updated i3 with improved batteries and a longer range between charges. "We expect further impulses for i sales in the second half when we bring an i3 with a 50 percent longer range," he said.
The upcoming i3 will be able to drive 300km (186 miles) on one charge, according to the European driving cycle, or roughly 200km in real driving conditions. The older version will remain in the market. Both will be offered with an optional small combustion engine as a range extender.
BMW was criticized by analysts in March after its new business strategy showed that the i subbrand will get little fresh product with only a roadster version of the i8 coming in 2018 and a production version of the iNext electric autonomous car concept not due until early in the coming decade.
BMW executives later said the subbrand will remain low volume, just like the M subbrand of high-performance cars. Instead, the return on the heavy investment to develop the i3's electric drive and passenger cell made of carbon-fiber reinforced plastic would come by rolling out the technologies into its range of models sold under the core BMW brand.
The last time BMW sold fewer units of its i3 and i8 models was in the second quarter of 2014 when the cars were slowly being ramped up. Sales peaked during the final three months of last year when volumes surpassed 8,900 cars.
Separately Krueger said the carmaker had enough staff to continue developing i models despite recent defections of key staff to China's Future Mobility Corp., a startup backed by Tencent Holdings.