The production freeze comes on the heels of multiple automakers withholding or lowering their annual guidance. By Stewart Burnett
BMW has informed US dealers that it will “postpone” production of electric vehicles (EV) in May, citing challenges likely—but not confirmed to be—related to the Trump administration’s volatile tariff measures. A company memo seen by Automotive News did not specify which models are to be affected, and sticker prices will largely remain stable through June.
The premium German automaker’s decision comes amid strong sales performance for its EV lineup, which includes the i4, i5, i7, and iX—models built exclusively in Germany—as well as the imminent launch of its much-hyped Neue Klasse series. In the first quarter of 2025, BMW sold 13,538 EVs in the US, representing a 26% year-over-year increase. The i4 sedan led sales with a 57% surge, while the iX crossover rose 23%.
Only two vehicles will be affected by price hikes: the 2 Series and M2 performance coupe, both of which will go up by 4%. Currently, BMW plans to start producing its Neue Klasse EVs in the U.S. and Mexico by 2026 to mitigate tariff impacts, with initial production beginning in Spartanburg, South Carolina.
The pause in EV production comes on the heels of multiple automakers withdrawing or lowering their financial guidance for the year over tariff fears. These include General Motors, Volkswagen, Mercedes-Benz, and Stellantis. In a conference call, GM Chief Financial Officer Paul Jacobson told reporters: “We believe the future impact of tariffs could be significant […] We’re telling folks not to rely on the prior guidance, and we’ll update when we have more information around tariffs.”
The Trump administration’s plans to eliminate the US$7,500 federal EV tax credit also threatens to weaken local demand for EVs. A November 2024 survey by JD Power found that 64% of premium EV owners cited tax credits and other incentives as a primary driver in their purchasing decision. Instead, US House Republicans are trying to pass a US$250 annual federal tax on EVs through Congress on the premise of offsetting the disproportionate damage they cause to roads.