BMW to lift electric car battery cell orders by 20-30 pct in 2016

ULSAN, SEOUL, South Korea, July 15 Mon Jul 14, 2014 8:00pm EDT

ULSAN, SEOUL, South Korea, July 15 (Reuters) - German premium automaker BMW plans to increase orders of electric vehicle battery cells by "at least" 20 to 30 percent from its exclusive supplier Samsung SDI in 2016 from its 2014 level, one of BMW's top executives told reporters.

South Korea's Samsung SDI will not only increase its supply for BMW's i3 and i8 electric cars but start supply for its future hybrid models starting with the X5 plug-in hybrid, Klaus Draeger, BMW's purchasing chief said.

The supply deal was part of a memorandum of understanding signed between the two companies on Monday, but embargoed until Tuesday.

"If we have hundreds of thousands of cars, then of course one would think about additional sources. But at first we need to get more economies of scale," he told reporters during his visit to Korea, referring to electric vehicles.

BMW sold 5,396 i3 cars in the first half of this year globally, compared with a total of 1.02 million vehicles it sold during the period.

Draeger acknowledged that one of the challenges for battery electric cars is the limited driving range called "range anxiety".

"This is why the whole industry is still looking very much at fuel cells because it is not clear what is also happening on the side of the electric infrastructure," he said, adding that BMW is also doing a research on a fuel cell vehicle system.

He said BMW also plans to further boost purchasing from South Korean suppliers from over 300 million euros ($408.45 million) in value this year.

($1 = 0.7345 Euros) (Reporting by Michael Perry)

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