BMW is seeing stronger demand for its electric vehicles in Europe than it expected, helping to offset a decline in orders in China, its biggest market, production chief Milan Nedeljkovic said.
"We expected at the start of the year that orders in Europe will decline, but it developed in the opposite way," Nedeljkovic told reports on Friday during a tour of BMW's plant in Dingolfing, Germany, where the carmaker started series production of the i5 full-electric sedan.
Europe posted an 11th consecutive month of growth in passenger car sales in June, led by a 55 percent surge in orders for EVs, which outpaced diesel sales for the first time in the European Union. In the same month, overall car sales declined in China as the country's economic recovery stumbled.
Orders for new BMW cars are currently declining in China, as expected, Nedeljkovic said. But U.S. demand for its models is growing. In Europe, uptake of fully electric vehicles drove order growth, while demand for combustion-engine cars was flat, he added.
BMW wants electric cars to account for 15 percent of its deliveries this year and expects fully electric models to account for half of total sales well ahead of 2030.
The automaker is boosting its EV lineup with the i5, a battery-electric version of the new, eighth-generation 5 Series.
The i5 is BMW brand's third full-electric sedan after the flagship i7 and the i4. BMW also offers three full-electric SUVs with the iX1, iX3 and iX.
The 340-horsepower i5 can drive 580 km (360 miles) on a charge.
Going forward, BMW is betting that its Neue Klasse electric vehicle platform, due to arrive around 2025, will accelerate sales. With the platform, the automaker aims to cut battery costs by half and increase range and charging speed 30 percent compared to current models.
To help finance the shift to electric vehicles, luxury-car makers such as Mercedes, BMW and Audi are trying to sell more of their most expensive models and offer pure-electric variants at higher prices.
With Tesla's price cuts, downward price pressures could also increase for BMW’s electric vehicle offerings. However, Nedeljkovic said BMW doesn’t plan to lower prices for its EVs.