BMW stock price tests weekly support

Written by: Michael Harris
December 29, 2020
  • BMW announced plans to significantly scale up its production of electric vehicles by 2023
  • The carmaker said 8% of the vehicles it produced this year were electricity-powered
  • Last month, BMW share price exploded nearly 25% to record one of the strongest months lately

Shares of Bayerische Motoren Werke AG (ETR: BMW), a major German car maker, trade modestly in the red this week as the price action consolidates after recording strong gains in November.

Fundamental analysis: Commitment to increase EV production to 20% by 2023

BMW said on Sunday it plans to significantly scale up its production of electric vehicles by 2023. 

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“We are significantly increasing the number of electric vehicles. Between 2021 and 2023, we will build a quarter of a million more electric cars than originally planned,” said Oliver Zipse, chief executive of BMW. 

The carmaker said 8% of the vehicles it produced this year were electric. By 2023, that figure is expected to jump to about 20%, BMW said. 

BMW UK is reportedly utilizing vehicle detection technology to make personalized warranty ads in an effort to make its current owners think about upgrading to a newer model.  

“15 thousand private and about 13 hundred public charging points would have to be put into operation every week as of today. Unfortunately, we are a long way from that,” Zipse said.

Last week, the German carmaker won the Trendence Young Professionals Barometer for the 9th consecutive year and a second place on the Trendence Graduate Barometer 2020. 

Last month, BMW reported an increase of 10% in its Q3 profit, jumping to £2.21 billion. The automaker said the 8.6% growth in year-over-year sales of luxury cars was the main contributor behind its robust profit results. 

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Technical analysis: A consolidation phase

BMW stock price opened almost 2% higher on Monday but lost almost all of these gains by the end of the session. The carmaker’s stock is sitting at nearly the identical level it was trading at the start of 2020.

BMW stock monthly chart (TradingView)

Shares are now trading at 73.18 EUR, or -0.42% on the day. Last month, BMW share price exploded nearly 25% to record one of the strongest months lately. A major target for the buyers looking higher is located at 78.74 EUR, where the 100-MMA is located.

Summary

BMW announced its plan to boost the production of electric vehicles to around 20% by 2023. In the meantime, the price action is consolidating after making impressive gains in November.