Ningde era may be profitable again, BMW executives said, "BMW will not build its own battery capacity in the next few years."

Defying the trend of global automakers building their own battery factories in the era of electric intelligence, BMW executives said on January 13 that the company was cautious about introducing homegrown battery packs quickly, given that research and development of battery technology was expected to last 10-15 years. This could mean that the Ningde era, which has reached tens of billions of yuan supply agreements with BMW, will benefit.

"We are not going to build our own battery production, but to work with suppliers." On January 14, a BMW insider in China confirmed to the Financial Associated Press after communicating with the German headquarters.

Nicholas Peter (Nicolas Peter), BMW's financial director, disclosed the information the day before. On January 13, after reviewing the financial performance of BMW Group in 2021, Peter said, "to some extent, we will continue to develop (battery) technology for 10-15 years. This is why it is very important for BMW to maintain common growth in battery resources with global companies."

"the company is assembling an experimental factory to support individual battery packs, but will not produce them on a large scale until the technology is mature." Peter also revealed that BMW has locked in stable demand for power batteries in the next few years with manufacturers that have already worked with them.

According to BMW, its pilot plant near BMW's global headquarters in Munich will be operational in 2022 at HY2, which will focus on research and development of batteries and battery production processes to optimize battery performance.

Public information shows that BMW Group has reached supply agreements with power battery suppliers including Ningde Times, Samsung, Northvolt and so on. Among them, in July 2018, it was rumored that Ningde era had reached a cooperation with BMW, and in the next few years, BMW would purchase batteries worth 4 billion euros (about 29 billion yuan) from Ningde Times. The order will be divided into two parts, of which 1.5 billion euros will be produced by Ningde-era factories in Germany, accounting for about 37.5% of total orders, and the rest will be supplied by Ningde-era domestic factories.

In response to this rumor, Ningde Times issued a clarification announcement on the evening of July 10 of that year-- the company received a fixed-point letter from BMW Group on May 16, which expressed BMW's intention to purchase power battery products from the company. it defines the company's obligation to provide it with products, and shows the possible demand for batteries for BMW-related models in a certain period of time in the future. It translates into about 4 billion euros according to the expected sales of related models corresponding to battery demand, but there is no clear agreement on the specific amount of battery products that BMW will purchase from the company.

In April 2021, Gaulle, president and CEO of BMW Group Greater China, told the Financial Associated Press that in the Chinese market, BMW worked with Ningde Times to develop batteries to fit BMW's packaging process. "whether it is investment or equity participation, it all depends on the judgment of the future market." Gaulle said that BMW currently maintains a good strategic cooperative relationship with the Ningde era.

In addition to the Ningde era, BMW also signed a cooperation agreement with Samsung SDI of South Korea in 2018. Under the agreement, Samsung SDI will continue to provide batteries for the BMW i3Personi8 and other possible future hybrid cars over the next few years. In July, BMW announced that it had signed an agreement with Swedish battery startup Northvolt on a long-term supply contract for lithium-ion batteries worth about 2 billion euros (14.6 billion yuan). Northvolt is expected to start delivering batteries in 2024 at the Northvolt Ett superplant in northern Sweden.

According to the latest data, BMW Group delivered a total of 103855 pure electric models worldwide in 2021, an increase of 133.2% over the same period last year, surpassing Audi's 81900 and Mercedes-Benz EQ's 48936.

According to the plan, by 2025, BMW Group's electrification strategy will launch a "new generation" model with a completely redesigned IT and software architecture, a new generation of high-performance electric drive systems and batteries. BMW is expected to deliver about 10 million pure electric vehicles worldwide by 2030. Around 2030, MINI and Rolls-Royce brands will also move towards full electrification.