BMW CEO: A 2035 gasoline ban will hit the European car industry ‘in its heart’ and make it reliant on Chinese batteries

BMW CEO Oliver Zipse said the EU’s ban on gasoline cars could “threaten the European automotive industry in its heart.”

The European Union needs to move away from its planned ban on gasoline vehicles if it wants to reduce reliance on China for batteries, BMW CEO Oliver Zipse said on Tuesday.

Zipse was addressing attendees at the Paris Automotive Summit when he criticized the EU’s requirement for all new cars and vans to have zero emissions from 2035.

The law, which was approved by EU countries in March 2023, is part of the region’s efforts to achieve climate neutrality by 2050.

“For the automotive industry, geopolitical resilience and access to markets and raw materials remains critical to success and future viability, while also reducing dependencies on China through openness to technologies,” Zipse said on Tuesday.

A “correction” of the planned 2035 gasoline vehicle ban, Zipse said, would help reduce European OEMs’ reliance on China for batteries.

Earlier in his speech, Zipse said the EU’s ban could “threaten the European automotive industry in its heart” and “lead to a massive shrinking of the industry as a whole.”

BMW’s decarbonization efforts, Zipse told summit attendees, weren’t just focused on the vehicles they produced, but also on their supply chains.

“To maintain the successful course, a strictly technology-agnostic path with the policy framework is essential,” Zipse said.

“The only thing that counts in the end is the tonne of CO2 that is not emitted and the earlier the better, and not the technological way how this reduction is achieved,” he added.

Representatives for Zipse at BMW didn’t immediately respond to a request for comment from B-17 sent outside regular business hours.

Several Western auto chiefs have commented on the challenges and difficulties that could arise from transitioning their industry to electric vehicles.

Stellantis CEO Carlos Tavares, who helms an automaker that owns brands like Chrysler, Fiat, Jeep, Maserati, and Peugeot, is advocating for a short transition from combustion engine vehicles to electric ones.

On Monday, Tavares said in an interview with the Financial Times that automakers will fall into a “big trap” if the EV transition slows.

Tavares said this is because automakers will have to continue investing in both electric and gasoline vehicles, thus incurring higher costs.

“When you make a longer transition, in fact, you don’t replace the old world by the new one. You add up the new world to the old,” he said.

EV sales have been declining in Europe in recent months. In August, EV registrations fell by nearly 44% compared to the same month a year ago, per the European Automobile Manufacturers’ Association.

That’s on top of the steep competition Western automakers are facing from Chinese counterparts like BYD.

Mercedes-Benz CEO Ola Källenius told attendees at the Berlin Global Dialogue conference on October 2 that the Western auto industry is fighting a price war with its Chinese rivals.

“It’s a Darwinistic-like price war, market purification. And many of those players that are around now. Many of those are not going to be around five years from now,” Källenius said.

“You must control your nerves, keep on investing, keep on innovating and make sure that at the end of that Darwinian battle, that you are one of the combatants that are left and that’s what we are focusing on,” he added.