In its effort to increase the number of EVs it has and stay on the cutting edge of EV technology, BMW signed a contract with a Chinese battery company for almost $5 million.
Recently we reported that BMW expects somewhere between 15 to 25 percent of its sales will be electrified vehicles by 2025. It seems the company is doubling down on electrified vehicles due to the fact that it signed a contract for tons of batteries through a Chinese supplier called Contemporary Amperex Technology, according to Carscoops.
BMW will source about $4.7 billion in batteries from the company as it expands its operations to a production facility in Germany. The new batteries would power BMW’s vehicles for years to come.
Contemporary Amperex Technology Expansion
If you haven’t heard of Contemporary Amperex Technology, you probably should take note. The company builds lithium-ion batteries, which are used in a wide variety of applications, including electric cars. In fact, the company is the largest supplier of batteries for electric cars in the world.
The company has grown considerably in the last several years. With BMW’s contract signed, it will open up a production facility in the Thuringa region of Germany. As Carscoops points out, this is a sign that the Chinese do an excellent job of producing batteries at a low price.
If the situation with BMW goes well, it could open up the door for more facilities. Robin Zeng, Contemporary Amperex Technology’s chairman, told Reuters that this could open up further opportunities for the company in the European market.
"“We want to supply all the OEMs (manufacturers) in Europe,” Chairman Zeng said. “If the Thuringia project is successful then we can consider other locations.”"
It will be interesting to see how the battery company does in the upcoming years.
BMW’s Electrified Future
It’s well-known that the future of the automotive industry will have a lot to do with electric cars. This will include fully electric vehicles and plug-in hybrids. BMW wants to be at the forefront of that movement. It’s not surprising that the company is investing heavily in battery technology.
What is somewhat surprising is that BMW signed the contract with Contemporary Amperex Technology for such a large number of batteries. The German company is investing in its own battery cell research, and it would seem they would want to keep all of it in-house.
Still, with more than 20 new electrified models on the horizon (both full-EVs and plug-in hybrids) BMW likely needs a lot of batteries to outfit its new lineup of vehicles.
Currently, BMW uses two different battery suppliers. According to Carscoops, the company will consider adding another supplier to the mix.