BMW CEO Sticks To Return On Sales Goal Even With Electric Cars

BMW plans to stick to a goal for 8 to 10 percent return on sales at its automotive division, even with the arrival of less profitable electric cars, its chief executive said at the Frankfurt Auto Show on Tuesday. "We're sticking to our 8 to 10 percent goal and maintain this range, even when electric mobility becomes more widespread," Harald Krueger told journalists. Krueger also said that the share of BMW's sales in Europe accounted for by diesel engines had dropped to 69.3 percent from 74.3 percent, but that he saw no need for writedowns on the value of the cars in its leasing fleet.

Also Read: Mercedes-Benz EQA Electric Car Concept Unveiled

Daimler's Chief Executive Dieter Zetsche had said Mercedes-Benz will offer electric versions of all its models by 2022, converting its Smart city car brand to become fully electric. Speaking at the company's investor day in Sindelfingen, Germany, Daimler said it will offer at least 50 electrified versions of Mercedes-Benz passenger cars in hybrid and fully electric car variants. Because electric cars have a lower margin than combustion-engine cars, Daimler has set itself a more ambitious savings target. The company's Fit for Leadership 4.0 plan targets savings of 4 billion euros ($4.8 billion), Daimler said.

"We are still aiming for a 10 percent return on sales, but have to be prepared for a kind of transition, with a corridor of 8 to 10 percent," he said.

Also Read: Carmakers Face Electric Reality As Combustion Engine Outlook Dims

As part of the cost savings plan, Daimler wants to save 1 billion euros from fixed costs, and another billion from research and development and capital expenditure. The remainder would come mainly from product costs.

Daimler said that by 2025, the purchasing cost of electric cars would likely reach parity with combustion equivalents, which could accelerate migration to battery powered vehicles. Electric cars are currently more expensive than combustion-engine cars because of battery costs.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)