BMW entering US Police vehicle market
BMW AG will provide diesel engines and powertrain systems to Carbon Motors Corp. -- an Indiana startup automaker that plans to start assembling police vehicles in 2013.
Carbon Motors, a privately held company based in Connersville, Ind., said it will begin production three years after it gets a low-interest government loan.
Carbon needs $310 million from the Energy Department's $25 billion advanced technology vehicle to begin production and hopes to win approval this summer.
Financial terms of the deal to provide more than 240,000 inline, six-cylinder engines over a multiyear period were not disclosed. BMW retrofits cars and motorcycles for police in Germany, but not in the United States.
Carbon Motors says it has advance orders from 350 police agencies for 13,000 vehicles -- with the Carbon E7 the first to come out in 2013. It would also like to export vehicles.
Last year, Carbon acquired a 1.8-million-square-foot former Visteon factory in Connersville but needs government loans to start production. It said it will create approximately 10,000 jobs, including 1,550 direct jobs.
Carbon is taking on Ford Motor Co., which sells about 75 percent of the police cars in the United States.
The company said the United States has more than 450,000 law enforcement patrol vehicles that consume over 1.5 billion gallons of gasoline and emit more than 14 million tons of greenhouse gas emissions annually. The Carbon E7 will cut these figures by up to 40 percent.
"We estimate that if the whole country were to switch over to the Carbon E7, we could save taxpayers in excess of $10 billion over 10 years," said William Santana Li, chairman and CEO of Carbon Motors.
Li said the vehicle will get a combined fuel efficiency rating of 35 mpg.
Carbon Motors will unveil the pricing of the E7 in a year, Li said, but promised that its prices would be "fully competitive," noting that a police car can cost $20,000 to $25,000 from a dealer, but reach $50,000-60,000 when special equipment is added.
Li declined to speculate on the company's future market share, but said it could be profitable selling 10,000 vehicles a year.
Since 2007, BMW has been working to expand its powertrain business by selling engines to other companies. Ian Robertson, a BMW board member, said despite better fuel efficiency and lower emissions, the diesel engines will deliver 40 percent more torque.
Ford is taking the competition seriously. Two weeks ago, it unveiled its new Police Interceptor, its replacement for the Crown Victoria.
It will be built at its Chicago Assembly Plant and is based on the Taurus platform. Detroit News