BMW Group Signs Deal to Build Electric Minis in China

BMW Group has signed with Great Wall Motors to produce Mini-branded vehicles in China. This is the German automotive group’s second joint venture in the region and will not affect its current alliance with Brilliance Auto — which builds BMW models specifically equipped to appeal to the Chinese market.

The same will be true for the Mini deal with Great Wall, as the entirety of the production line will be electric vehicles. While the main reason for this is to ensure BMW hits its government-imposed quota for EVs, Great Wall said the venture would help it meet the needs of Chinese consumers and tap into the new energy vehicle market both home and abroad.

Mini has said a production version of the Mini Electric Concept won’t happen until November of 2019, but there’s been buzz that the automaker may seek widespread electrification after that. Interestingly, Chinese Minis will use a new platform developed by the joint venture, rather than rely on whatever architecture the Western-built EV adheres to. That’s two separate plug-in product lines. Will EV exclusivity be the future of the brand?

With automakers scrambling to meet strict new targets in China, — which has called for electric and rechargeable hybrid vehicles to account for a fifth of an automaker’s total sales by 2025 — BMW Group could be positioning Mini to assume the majority of the responsibility. However, as a separate marque with a completely different partner, it’s unlikely the Mini EVs will count toward the rest of the auto group’s total.

Instead, Mini might serve as a testbed to help BMW make up its mind on how to approach the Chinese rules. Larger companies will be expected to produce over a million plug-ins in just a couple of years to satisfy the new electrification and fuel economy requirements. The catch is, the consumer base doesn’t yet purchase enough of them to support those numbers. An automaker could be diving headlong into disaster if it isn’t totally prepared.

Reuters reported that the Chinese venture could start making the electric Mini in 2021 or 2022, adding it would also produce models under the Great Wall brand.

Analysts at Bernstein claim they were confused as to why BMW opted to have a minority stake in the deal. Holding less than than a 50-percent stake would give Great Wall rights to any intellectual property the two companies develop together. Neither company has been willing to elaborate further on the deal.

“Next steps will be to agree on the details of a possible joint venture and cooperation agreement and clarify aspects such as the choice of production location and concrete investments,” BMW said. It a separate statement, it also explained it would further expand its alliance with Brilliance.

[Image: BMW Group]