US & EU Tariffs Crush MINI’s Dreams & Change Production Plans
As we detailed in our three part series “Did MINI Go Electric Too Soon“, MINI has been on the back foot caught in the middle of global politics and a trade war. What that means for production and model availability is starting to come into picture. What that means for the brand however remains to be seen.
It all started with the US adding a 25% tariff to Chinese electric cars in 2018 due to allegations that the government in China was illegally propping up the industry. Right or wrong the concern was that low-priced, heavily subsidized Chinese EVs could soon flood the U.S. market. Which they did elsewhere as China’s global exports of EVs grew by 70% from 2022 to 2023. These tariffs will now rise to 100% later this year.
Much of that EV growth was in Europe where up to 37.6 percent a tariffs went into effect just weeks ago.
It seems BMW’s current strategy is to simply eat that cost which in turn eliminates most if not all profit. If they did pass that cost onto the consumer, MSRPs would increase to levels that would simply kill most if not all sales. For instance the tariff would add €13,000 to the price of the base J01 Cooper.
While it’s doom and gloom in the short-term, MINI has a long term answer. The company has changed strategy and will expand production of both the J01 MINI Cooper and J05 MINI Aceman to its Oxford UK plant as quickly as possible. The date set is 2026 and it’s our understanding that the J01, J03 and J05 will all be produced there along with the F65, F66 and F67. This will eliminate tariffs for critical markets like North America and the EU.
MINI says that Oxford only produces up to 1,000 vehicles per day with three shifts operating at the plant. Will that be enough capacity for six distinct models sold in the UK and the rest of the world? Granted Oxford doesn’t build Countryman but peak MINI sales were nearly 372k in 2017.
With the increased capacity that number will go up dramatically.
The economic war between China and the rest of the world does not explain the poor commercial start of the F66 and the J01 all over the world
I’d say the ugly interior is a bigger impact.
(coming from a 20+ year, 4 car MINI owner)
I agree. I don’t like the houndstooth/overly patterned surface. It’s distracting and overcomplicated for a series of vehicles that are supposed to be about returning to simplicity (I think the wheels are too busy too, but that’s a different story.) They need more variety of colors as well.
I’ve also seen in several video reviews that the surface of that interior woven material feels cheap and plasticky.
There is overuse of the phrase “remains to be seen”. The 4th paragraph contains a nonsensical fragment.
“Currently BMW is eating that cost likely eliminating most if not all profit from each car sold. If stye and not passing it onto the consumer. If they would the result would be an MSRP increase of more than €13,000 to the price of the J01 Cooper.”
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