BMW's Neue Klasse accelerates as EU policies spark industry concerns

BMW is pushing ahead with its Neue Klasse electric vehicle programme while maintaining strong production across its European plants. The company's Munich factory is running at full capacity as it prepares for the transition to the next generation of cars. Meanwhile, a top executive has warned that new EU policies could threaten Europe's industrial competitiveness.

Last year, BMW's German plants built over a million vehicles, with Regensburg and Leipzig operating near maximum output. The company has also cut production costs by up to 25% over the past five years, thanks to flexible manufacturing processes.

The Neue Klasse investment includes a dedicated plant in Debrecen for the iX3 and five new battery assembly sites, one of which will be in Bavaria. BMW is not scaling back in Europe—instead, it is expanding existing facilities and building new ones to support the shift to electric vehicles.

Milan Nedeljković, BMW's production chief and future CEO, emphasised the company's 'Production follows the market' approach. This strategy allows BMW to adjust car specifications just six days before assembly and shift production volume between plants in real-time. The new i3, for example, will launch in Munich before expanding to Shenyang and San Luis Potosí, depending on demand.

However, Nedeljković criticised the EU's proposed Industrial Accelerator Act for focusing too narrowly on 'Made in Europe' without considering global supply chains. He argued that Europe should instead promote free trade and a business-friendly environment to keep its industrial sector strong.

BMW's latest investments show its commitment to European manufacturing while adapting to electric vehicle demand. The company's flexible production model allows rapid adjustments, but concerns remain about EU policies potentially weakening Europe's competitive edge. The Neue Klasse rollout will test both BMW's strategy and the region's industrial resilience.