DAX-40-listed Bayerische Motoren Werke AG or BMW (DE:BMW) yesterday announced an investment of £600 million for transforming its Mini factory located near Oxford to expand its electric vehicle (EV) production. The factory, located in Cowley, Oxford, is more than 100 years old and was home to the production of Mini models in 1959. The company will also invest in its Swindon plant, which specializes in producing parts for Mini Cooper models.
BMW will make two EVs, the Mini Cooper 3-door and Mini Aceman, from its factory in Oxford, which is expected to start in 2026. This move is anticipated to significantly uplift the UK automotive sector while ensuring the safety of 4,000 jobs.
The BMW share price went up by 0.95% yesterday after the news. The stock has lost over 12% in trading in the last three months despite the company reporting a good set of Q2 earnings in August. The company also raised its outlook for the full year, driven by higher order volumes and better pricing. On the flip side, the company remains cautious about the continuous inflationary pressures and supply chain issues impacting its margins.
BMW is a renowned global carmaker celebrated for its luxury vehicles. The company boasts a portfolio that includes brands such as BMW, MINI, Rolls-Royce, and BMW Motorrad.
Big Relief for the UK
The UK car manufacturing industry experienced a sharp decline due to chip shortages during the pandemic, leading to a significant drop in production levels last year. This was worsened when Honda Motor Company (GB:0J5T) moved its base from the UK and switched to Japan for its EV production. Nevertheless, apart from BMW, companies such as Nissan and Tata Motors have recently revealed their plans to establish factories in the UK, revitalizing their presence on the industrial landscape.
The British Prime Minister, Rishi Sunak, highlighted the BMW investment as “another shining example of how the UK is the best place to build cars of the future.”
Is BMW a Good Share to Buy?
According to TipRanks’ consensus, BMW stock has received a Hold rating based on recommendations from 15 analysts. The BMW share price forecast is €107.97, which is 12% higher than the current price level.
