BMW to build new electric SUV in South Carolina

BMW announced on Tuesday that it will begin producing electric vehicles in the United States by the end of the year, a move that reverses when many automakers are slowing investment in the technology.

The iX5, a mid-size electric sport utility vehicle, will be the first new electric vehicle to roll off the assembly line at the German automaker’s factory in Spartanburg, S.C. By 2030, the company plans to produce six electric models at the plant, one of its most important and largest outside of Germany.

Other automakers have delayed or canceled electric vehicle projects in recent months, posting multibillion-dollar losses as a result. They are responding to weak sales in the US after Congress eliminated subsidies for electric car purchases.

BMW exports about half of its cars to Spartanburg, where it produced more than 400,000 cars last year. The complex in South Carolina is the company’s main production center for the X5 and other SUVs.

Exports allow BMW to benefit from strong demand for electric vehicles in Europe, where they account for 20 percent of new car sales. That’s compared to about 6 percent in the United States.

BMW is going in the opposite direction to many of its competitors.

In March, Honda canceled plans to build three electric models in the United States. This change resulted in restructuring costs and write-downs of $9 billion.

Last year, Ford stopped making its F-150 Lightning, closed a factory in Kentucky that made batteries for the pickup last year, and posted a $19.5 billion profit.

General Motors and Stellantis, maker of Jeep and Ram vehicles, also adjusted their plans and posted losses on electric vehicles.

Unlike BMW, Ford, GM and Honda do not have a large enough presence in Europe to benefit from the demand for electric vehicles there. Ford has less than 3 percent of the European car market, while Honda has less than 1 percent. GM sells a small number of Cadillac electric vehicles in Europe.

But BMW is also betting that demand for electric vehicles, which has been erratic, falls short of expectations.

The iX5 is an electric version of the popular X5 range of vehicles, which will also be available in petrol, diesel and plug-in hybrid versions. BMW will build all variants on the same assembly line, allowing it to adjust production according to demand. Eventually, BMW plans to offer a version that runs on hydrogen.

BMW unveiled the latest version of the X5, its best-selling model in the United States, at an event in Spartanburg that the company said was the culmination of a $1.7 billion investment to expand the plant and build a battery factory in nearby Woodruff, SC.

The investment is an expression of “our confidence in the United States and strengthens South Carolina’s role at the center of BMW Group’s global operations,” Milan Nedeljković, the company’s CEO, said in a statement.

In the fall, the automaker will begin selling a smaller electric SUV, the iX3, in the United States. This model is the first of several revised electric cars that BMW will launch in the next few years.