One of Europe’s leading automakers is taking a popular brand electric. BMW (OTCMKTS:BMWYY) is known for producing sleek, reliable luxury vehicles that dominate markets across Europe and North America. The company has done an excellent job keeping up with the electric vehicle (EV) trend. A U.K. automotive expert recently praised the popular BMW i3, stating that the EV would still feel “modern and progressive” if it were launched today. Yesterday brought reports that the company is pushing ahead with plans to take another popular vehicle electric. BMW is investing heavily in producing electric Mini Coopers in Europe, a likely catalyst for BMWYY stock.
China’s booming EV sector still poses a threat to automakers in both Europe and the U.S. However, investors shouldn’t disregard this news. Let’s take a closer look at why this decision could help keep BMW competitive in the EV race.
What’s Happening With BMWYY Stock
News of this development boosted shares for BMW yesterday. Today, market momentum has shifted, causing some volatility for BMWYY stock. While shares are currently down 0.11% for the day, their current trajectory suggests that a rebound is likely. It’s been an overall difficult month for the stock but news of this significant EV bet is exactly what the beloved automaker needs to turn around.
BMW announced yesterday that it will be investing 600 million pounds to manufacture electric Mini Coopers in Europe, the equivalent of $750 million. It plans to set up shop at a factory in Oxford where it will produce an electric three-door sedan, the Mini Aceman, a compact sport utility vehicle (SUV).
It makes sense to double down on producing this iconic brand in the U.K., as that is where it originated in 1959. The soaring cost of fuel had created the need for a car with a smaller engine that required less gasoline. Decades later, gas prices are rising again, but this time, drivers have the option to go fully electric. BMW is giving British motorists the option to eliminate high fuel costs and still drive a car that they love.
Following Brexit, some experts worried that the switch to EVs could pose a threat to Britain’s automotive industry. But this move from BMW should demonstrate that an opposite outcome is unfolding. As The New York Times reports:
“There had been worries that BMW might shift all electric Mini production to China, but the move to continue producing the vehicles in Britain was not necessarily a surprise. With the future of the global car industry clouded by uncertainty over how the shift to electric vehicles will play out, analysts say it was logical to make what is a relatively modest investment by auto standards to keep making the cars in Britain for the next few years.”
By that logic, this development is a win for the British economy. But it’s also great news for BMWYY stock, which is likely to soar as production gets underway and electric Mini Cooper models start hitting the streets. Additionally, this isn’t the first investment BMW is making in EV production. As InvestorPlace contributor Faizan Farooque reports, it will have invested $30 billion in electric and self-driving vehicles by 20245. For investors seeking exposure to the EV market, BMWYY stock is an excellent bet.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
