BMW bet on electric cars comes up short for investors - Stock price falls
Join Date: Aug 2012
BMW's investments in new models, such as their i3 EV, have lead to the forecast of weaker profitability in the fourth quarter, which caused BMW's stock to fall 4.8 percent, according to a recent article by Plugincars.com. Here are some key points from that article.
BMW’s investment represents a much-needed infusion of new blood into the EV space—as we approach the third anniversary of the introduction of the Nissan LEAF and Chevy Volt. The EV story so far has been dominated by American and Japanese automakers. Don’t look now, but it appears the Europeans—led by BMW, with Volkswagen not too far behind—are about to start making waves.
Arndt Ellinghorst: Yes, they are spending more than a billion euros on the i brand. They clearly have the most revolutionary approach to electric mobility out of the traditional carmakers. They are taking a huge bet. I think that the market should appreciate that, but you see what happened today. The stock is being slashed 4 percent because the company is spending more on electric vehicles.
They are taking a bet with this new brand and the new manufacturing technology, carbon fiber. But again, I think the market should appreciate that, and not hammer the stock down.
BMW has definitely bet a lot on the i Division. This shows their dedication to the i brand, and to the future of electric vehicles. It's unfortunate that stock prices have to suffer because of it. What are your thoughts on this? Maybe it's the collection of other new BMW models that's stretching BMW out?
Read the full article from Plugincars.com here.