The production side of things in the automotive industry is becoming trickier by the minute right now. With various governing bodies asking for more responsibility from car makers and with the companies themselves setting up goals to cut emissions by as much as possible in the near future, keeping the production costs in check is definitely a demanding task. After announcing plans to improve the recycling of various materials in the manufacturing process and cut emissions at the same time, BMW is now looking for cost cutting too.
In a recent interview with German magazine Handelsblatt, BMW’s board member in charge of production claimed that production costs need to come down, in order to allow the company to remain competitive, says Reuters. “We will lower the production costs per vehicle by 25% by 2025 – compared with the level in 2019,” said Milan Nedeljkovic in the aforementioned interview. This way, BMW will be more competitive against companies like the VAG group, Daimler or even Tesla.
There was no mention as to how those goals will be achieved and such a cut, in such a short period of time, will definitely be tricky to hit. However, BMW has to remain profitable and cutting production costs is one of the ways in which that could be done. As we’re entering the electric age, things are bound to get increasingly hard for a lot of companies, trying to make ends meet somehow.
The investments needed for the switch to electric platforms rise into the billions and that’s just one side of the story. The new cars have to be more eco-friendly in a number of ways, from the production process to the materials used. The manufacturing side of things also has to use green energy as much as possible and all these factors, combined, will take a toll. Only the future will tell which companies will survive and which won’t.
[Source: Reuters]
