Global Crisis

Jose explaining the features of the concept i3 at the BMW i Born Electric Tour back in 2012

Having been in BMW's trial lease e-mobility program for five years, I've been able to get to know many of the program managers and engineers working at BMW i in North America. Jose Guerrero, Product Planning and Strategy Manager for BMW i, is one of only a few people at BMW of North America who has been a constant force in the program over the years. That's the nature of the auto industry though. People move around within the company, and often even leave to take on positions at competing OEMs.

So when I saw Jose's name on the list for available interviews at this year's New York Auto Show, I quickly reserved a half hour to sit down with him and talk about the i3 and the future of BMW i.

My i3's battery pack. It was removed from the car in less than an hour.

Future Battery Replacement

The first question was easy. There has been a lot of talk about recent comments by BMW's R&D chief Klaus Froehlich. Froehlich was recently interviewed by Automotive News Europe and asked if BMW would be offering a "more powerful powertrain" for the i3 or i8, and many took that as meaning better batteries once they become available. Froehlich said:  “I don’t think a retrofit makes sense. When better batteries are available, we could then offer models with a longer range or with the same range but at a lower price" and "replacing the batteries is very complex because they are integrated and bonded into the chassis." This didn't make sense to me because I know that any certified BMW i service center can drop the i3's battery and replace one or more of the eight battery modules and put the car back together in a couple of hours. In fact, I've personally seen it done on my car in less than a day. What would prevent BMW from upgrading these modules with higher energy-density cells once they are available in a few years? Here's what Jose had to say about that:

The underside of my i3 with the battery pack removed.

"The strategy of BMW i has always been focusing on sustainability, recycling and really maximizing the usage life of the car. I mean, first of all the car won't rust. It's made of carbon fiber reinforced plastic & aluminum so we are looking at how do we maximize the car for long usage. He didn't say it's not upgradable, but rather that at this point it doesn't seem to make sense. We really are investigating this and if it's possible, and it makes financial sense, why not? This would be in line with the BMW i philosophy. We haven't said we aren't going to do it, just that it has to make sense. A BMW i dealer can do a complete battery replacement in 3 to 5 hours so from a technical perspective it's clearly possible, we would just need to make sure it also makes financial sense. We are always getting asked, "Could you retrofit a navigation system, or Comfort Access into a car?" Yes, we could, but we'd have to rip the whole car apart. That isn't the case with better batteries once they become available, it just has to make sense. We are definitely investigating this, so if it makes sense we'll do it." Guerrero further went on to say it's conceivable Froehlich may have been misquoted or perhaps there was a translation issue because he certainly knows the batteries aren't "bonded into the chassis" as the Automotive News Europe's story indicated.

The Circuit

BMW i has recently launched a new online forum called "The Circuit". Would you like to explain why, and what exactly it is?

"We recognized these cars are different and customers will have questions that are unique to the i brand. We wanted to provide a forum where BMW i customers could communicate amongst themselves, share information and also ask BMW questions directly. There is an entire section called "Ask BMW" where customers can ask questions and get answers much faster than would have ever been possible before. It's direct access to BMW i personal that was not previously possible. We'll post information regarding technical updates, upcoming events, and all official BMW i news. It's our goal to use the forum to improve the BMW i ownership experience."

Hill Climb Assist

Late last year BMW had stated the i3 with range extender would have a software update in March which would add a new feature called "Hill Climb Assist." This was supposed to prevent sudden reduced power mode without warning while the REx was running and to make the vehicle more capable of climbing long, steep hills at highway speeds while in charge sustaining mode. Can you talk a little about this?

"This is something we are still working on. First, let me say the March 15th software update addresses part of the problem which was to provide information to help the driver avoid reduced power in these challenging driving conditions. A big gripe which the owners conveyed to us was they didn't have any warning before the vehicle reduced power. We've corrected that with a warning which comes on before the vehicle enters reduced power mode to warn the driver to alter their driving (basically that means to reduce speed) to hopefully prevent reduced power. Secondly, we've added a state of charge display so drivers can see the exact state of charge and monitor it more closely during these driving events. The the new state of charge display is also applied to the BEV i3s once they get the software update also.

An audible warning and this visual alert comes on when the state of charge drops to 3.5%, warning the driver that reduced power is possible, and giving them time to alter their driving to avoid it.  You can also see the new SOC display in the top left corner.

As for the Hill Climb Assist feature, we're still perfecting it. For the past four months we had a group of i3 REx owners beta testing Hill Climb Assist software and the feedback we got caused us to go back and redevelop it, creating an even more robust version. We are now testing a new version and once we're confident it is ready we will again give it to the beta test group for real world testing before we release it to the general i3 public. We are committed to getting this right and feedback from actual i3 owners is critical."

At this point I was shown a video of an i3 REx driving up a steep mountain climb at highway speeds in the snow. I was told this car had the new software and they were testing it in Vermont this winter on a closed road which was over 3 miles long, up steep hill at highway speeds in the snow. It should be noted that I am one of the people in the i3 REx customer beta test group which tested the previous Hill Climb Assist software. I reported back to BMW that it was insufficient, and it was my recommendation to re-engineer it before it was released to the public. I'm happy BMW agreed and look forward to testing the current version which I'm promised is more robust. I'll report on this new software once I have it on my car. It's not expected to have this new Hill Climb Assist software ready for the general public for another six months or so.

BMW i has a new North American Manager. What changes should we expect?

New Program Manager for BMW i

My last question was regarding the new Manager of Electric Vehicle for BMW of North America, Christine Fleischer. BMW i of North America hasn't had a permanent division manager since Jacob Harb left the post back in November. Prior to assuming the position at the helm of BMW i, Christine had been the BMW M & Individual Area Manager for North & South America.  I asked Jose what this means for the future of BMW i.

"Christine has now started her new role and we're all very excited. During Jacob's time here he was focused on the launch of the brand and we're now in a different phase. Now with Christine we're focusing on continuing dealer training and building sales. We're through the early adopter phase of i3 sales, and we now need to reach the early majority to continue to build sales. Dealer training is important and we'll continue to offer this specialized training so our sales force is prepared, and that's critical to maintain the sales momentum we've built. The whole team is excited to have Christine here for the next phase of BMW i."

The new North American BMW i manager, Christine Fleischer next to a 1M at the Canadian launch in 2011. Photo courtesy of BMWBLOG

Horatiu Boeriu of BMWBLOG recently did a piece titled "BMW vs. Tesla - Which Company Is A Bigger Innovator?" in which he mentions that while both companies are competing in the premium automobile segment and are committed to electric mobility, they are taking different paths to achieve success.

I'm not going to try to analyze who has it right or who is a bigger innovator, but it's clear that both companies have chosen to focus on different aspects of their respective vehicles. With Tesla, it's all about the batteries. Unlike every other automobile manufacturer, BMW included, Tesla's approach isn't for their electric cars to complement their lineup of gasoline and diesel offerings since they don't have any. Instead, it is to render gasoline vehicles from their competitors obsolete. In order to do so, their cars have to be at least as good or better than most features of competing gas cars; and that includes range, performance and utility. BMW on the other hand doesn't need to necessarily worry about making everything better. They can focus on specific needs of certain customers and make a vehicle that is better than any other at a specific set of tasks, without cannibalizing sales of other vehicles in their lineup. If you accept that premise, it's not difficult to understand why we have the Model S and the BMW i3.
Tesla knew they had to knock it out of the park with their first high volume vehicle offering. They knew they had to offer a car that could stand its ground against all of the top luxury sedans while offering a range long enough to allow for road trips enabled by the Supercharger network. Even though that was an enormous task, and one that few automotive analysts really believed they would pull off, they did just that and the Model S is a smashing success. No disrespect to the sexy styling or the fabulous performance of Model S, but the heart and soul of what the car is can be attributed to the enormous battery pack it uses, filled with industry leading, high energy-density batteries. Tesla is all about the batteries. Even though the Model S uses batteries that have a higher energy density than any other EV manufacturer, they still aren't satisfied. They aren't waiting for the market to bring them better, cheaper cells for their future cars. Instead they are in the process of building what will be the first of many Gigafactories, which will be the largest lithium ion battery manufacturing plants in the world. This will drive down costs, guarantee that they have the supply that they need, and allow them to constantly upgrade to better cells without needing to wait for battery manufacturers to retool production facilities to produce them. The key to Tesla's success is having the best batteries available, and to manufacture them for less than what their competitors are paying for comparable cells. It's the only way to offer large battery, long range electric vehicles and be able to price them competitively.  It's Tesla's edge, and perhaps their only hope to compete and actually beat the large, established automakers.


BMW's not in the battery business and is unlikely to follow Tesla's path as such. As mentioned above, since they didn't need the i3 to do everything better than any other gas offering as the Model S had to, BMW could focus on a specific set of goals with their first electric vehicle. The i3's code name was the Megacity Vehicle and the goal was to develop a car that would be the perfect electric vehicle for the increasing populations within the megacities of the world. They also wanted this car to represent a departure from traditional manufacturing processes with an emphasis on sustainability.  They set out to make the most efficient production car available today and they achieved that goal. The extensive use of carbon fiber reinforced plastic and aluminum allowed BMW to shave 400 to 500 lbs off the car which played a primary role in its efficiency.

Will BMW leave Tesla in their rear view camera? That doesn't look very likely at present.

I believe the i3 is as much of a learning experience for BMW as it is their first electric vehicle. Every step of the manufacturing process was rethought and redesigned for the i3. In fact, the i3 uses 70% less water and 50% less electricity to manufacture than a comparable-sized conventional BMW would. In addition, the Leipzig manufacturing plant where the i3 is made is now completely powered by wind-generated energy. So as much as the i3 is an important vehicle to BMW today, the lessons learned bringing it to market today will pay dividends when future i cars are made. The i3 indeed paved the way for the rumored i5 and other models from the i brand. You can expect larger battery, longer range electric cars from BMW i in the not-so-distant future. I suspect by the time Tesla releases the Model III, BMW will have an electric offering which is comparable size, range and price, and that will be good news for the consumer.

My i3 had a visit by its big brother. I'm one of the few lucky people outside of some select journalists who have driven an i8 on public roads. The future is definitely looking electric!

BMW knows that by focusing on a specific set of needs (efficiency, performance, sustainability) rather than long range, the i3 isn't as well suited for road trips as the Model S. They knew that every kWh of battery that they added would sacrifice efficiency and increase the cost of the car. I still maintain that if BMW had indeed used a slightly larger battery and delivered a true 100-mile EV, it would have been much better received, but that's a pointless argument now. While it does have a shorter range, the i3 does have features that are not even available in the Model S, such as adaptive cruise control, collision avoidance with automatic braking and self parking. As you would expect from BMW, the i3 is an extremely fun car to drive, and a great addition to the current lineup of EV offerings. I think it fits in well situated directly between the Model S and the LEAF in price.

My i3 at home

BMW did realize some customers would want a longer range so they offered the range extender as an option. It's really a great option to have and while I personally like how well it works, it isn't for everybody. Many have argued that the REx ruins the purity of an EV, and while I can agree with that, I can't agree that it shouldn't be an option. If such a feature allows more people to buy a plug in car, then I think that's great. I see the range extender as a temporary fix until batteries get better, lighter and cheaper, but a necessary evil at present. Obviously BMW agrees with that and unlike Tesla, they will wait for the market to bring them improved battery tech while Tesla has decided to bring improved battery tech to the market. Different approaches, different cars and I don't think either is right or wrong. They are both working on bringing cutting edge technology to market today with the promise of even better things to come. BMW and Tesla aren't going head to head in the EV space right now, but they certainly will. Competition is good because it forces innovation. Maybe Horatiu was onto something after all.

One last point: If Nissan does deliver on the rumors that the next generation, 2016 LEAF will have a 150+ mile range, and they can deliver it for a reasonable price, then both Tesla and BMW should be concerned, very concerned...

BMW and Tesla going nose to nose in the premium electric vehicle market is inevitable.

The i3 is set to launch in the UK, Germany and other select European countries in about two weeks now and BMW i marketing is preparing for the launch. Ads for the i3 and i8 are appearing in magazines and now a new video(seen above) has surfaced on the BMW UK YouTube channel.

I have been a bit critical of the little I've seen so far to promote the i3 and feel like BMW has been leaning on the sustainability angle way too much. In addition it seems like every short video clip they have made features a slim/metrosexual/surfer type. I'm not the only person to say this either, in fact of Richard Read of Green Car Reports wrote a whole tongue-in-cheek article on this, asking if BMW is only interested in waify metrosexuals to buy their i3's!

The good news is this spot is much better than what has previously been out there. I particularly like how the video has the i3 and i8 driving down a street in Chicago together to signify that they are born from the same genes but at a point they turn in different directions because, let's face it, although they have the same genetics these are two very different cars with different purposes. The camera follows the i3 until it eventually enters the car to show the interior and the drivers point of view before moving onward.

There is no talk of sustainable living, recycled materials or plant based door panels and key FOB. We hear about making choices, intelligent and efficient, lightweight carbon fiber, driving pleasure, electric and finally we're asked "Are you ready?" All to the perfectly selected and inspiring tune of Claire's Horizon (Broken Promise Land version). This is much more like it. Now sprinkle in a few video clips of an i3 screaming around a racetrack with one of your professional drivers at the wheel and we'll be lining up for test drives.