BMW CEO Optimistic About Tariff Agreement With U.S.

BMW CEO Oliver Zipse is hopeful for a swift resolution in the ongoing tariff negotiations between the European Union and the United States.

Speaking in Munich on Friday, Zipse expressed optimism that an agreement could soon be reached--one that the company would be able to manage. He noted there was a possibility of establishing a mechanism that would allow for imports and exports to be offset against each other.

According to insiders, the EU has put forward a proposal in the talks that would allow European automakers--primarily German premium manufacturers BMW and Mercedes-Benz, both of which operate large plants in the U.S.--to deduct their U.S. imports from their exports through a system of credits. Rather than offsetting the number of vehicles, Zipse explained, the value of exports would be used for the calculation. Any exports exceeding the agreed value would be subject to tariffs. Should both sides agree to this mechanism, BMW would also benefit from the arrangement for imported engines.

BMW operates its largest global plant in Spartanburg, South Carolina, where various SUV models are produced. Of the approximately 430,000 vehicles manufactured annually in Spartanburg, more than half remain in the U.S., according to Zipse, while the rest are exported. BMW primarily imports sedans into the U.S., such as the 5 Series and 7 Series. Additionally, engines for the Spartanburg plant are produced in Dingolfing, Germany.

Zipse described the discussions as challenging. The Munich-based automaker has made it clear what is at stake. "We have an important point, as we are the largest car exporter in the U.S.," he said. He added that he sensed Europe was making moves and not retaliating--though this approach carried the risk of escalation.

(Reporting by Christina Amann, editing by Ralf Banser. For further inquiries, please contact our editorial team at [e-mail] (for politics and economics) or [e-mail] (for companies and markets).