BMW Drops Manual Transmission From Best Model to Help Pay for R&D

BMW plans to streamline its manufacturing process by providing fewer model variants and eliminating less popular engine or equipment options. The goal here is to free up capital for research and development spending in the coming years, according to a Wednesday announcement from the brand’s chief finance officer, Nicolas Peter.

With most German automakers already pushing heavily into the realm of electric vehicles, BMW’s strong presence in China is forcing it to further bolster its efforts in EV development. The country’s particularly aggressive emission regulations and mandates on electric vehicle sales means any manufacturer hoping to persist within its borders will have to ensure 12 percent of its fleet is electric by 2020 — and BMW isn’t ready.

As a result, the automaker is trimming fat wherever it can find it. Unfortunately, that means eliminating the manual gearbox for the 2 Series in the United States and abandoning certain engine options for models across the globe. While BMW wasn’t explicit as to which motors won’t be returning, odds are good it will be the fun ones that don’t sell as well, plus the diesels.

“In the 5 series we have four diesel engines on offer. I would not bet on there being four diesel engines on offer in the next generation vehicle,” Peter explained.

While depriving North America of a manual transmission variant of its most enjoyable-to-drive car won’t win it new fans, BMW is responding out of necessity. According to Reuters, the automaker spent 5.5 percent of its total revenue on R&D in 2016 and needs to bring that up swiftly if it is to have EVs ready for China.

While sales in the U.S. have stagnated slightly, BMW has witnessed double-digit sales growth in China and remains on track to keep pace with the launch of a longer-wheelbase 5 Series and a new X1, Peter said. But only if it can keep itself in the electric car game by boosting development, hence the cost-cutting measures.

However, BMW can’t simply terminate whole models from its lineup and expect to immediately turn a profit from electric vehicle sales — which are still weak, even globally. It needs to maintain internal combustion volume, but it doesn’t need to provide those vehicles with a plethora of options.

“We have over one hundred steering wheels on offer. Do we need that many variants?” Peter asked reporters.

If you can remember back to the 1990s, when Chrysler seemed to have only two steering wheels for its entire fleet, then you already know the answer to the question. No, of course not. No automaker needs one hundred distinctive steering wheels. That’s absolutely insane and BMW is right to scale back on them. We just wish they’d have stopped there and decided not to take away the manual-transmission 2 Series, as well.

[Image: BMW AG]