Transformation under structural cost pressure
BMW invests billions in the future of the 3 Series
With investments of around two billion euros, BMW is reorganising production of the new 3 Series in Bavaria. Munich is becoming an electric location, Dingolfing is concentrating internal combustion engines and plug-in hybrids. Gen6 batteries, recycling and new assistance systems are intended to secure efficiency and technology leadership.
BMW is investing around €2 billion in its Bavarian plants in Munich, Dingolfing and Irlbach-Straßkirchen as it prepares production for the eighth generation of the 3 Series. The manufacturing strategy assigns clearly defined roles to the individual sites, while combining local battery production, higher vertical integration and new recycling processes.
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For BMW, the 3 Series remains one of the most important model lines in its global production network. Around 18 million vehicles have been built to date, roughly 15 million of them in Germany. The new generation now also illustrates how the carmaker intends to manage the transition between combustion engines, plug-in hybrids and dedicated electric architectures.
The Munich plant has been converted for production of the fully electric Neue Klasse models, including the new BMW i3. Dingolfing, BMW’s largest European production site with around 18,500 employees, will manufacture the combustion-engine and plug-in hybrid versions of the new 3 Series.
At the same time, BMW is reducing powertrain complexity. A diesel version will no longer be offered for the new generation. From a manufacturing perspective, this eliminates components associated with diesel exhaust aftertreatment and simplifies both assembly and logistics at Dingolfing.
Battery production follows local-for-local approach
BMW is also expanding local battery production in Bavaria. In Irlbach-Straßkirchen, around 30 kilometres from Dingolfing, the company has established a new assembly site for sixth-generation high-voltage batteries.
The site covers around 60 hectares and includes more than 50,000 square metres of production space. Battery assembly started on October 1, 2026. The plant will supply nearby vehicle production as part of BMW’s local-for-local strategy.
The sixth generation of battery technology represents a major change in both cell format and vehicle integration. BMW is using specially developed cylindrical cells for an 800-volt architecture for the first time. According to the company, the cells offer around 20 per cent higher energy density than the prismatic cells used previously.
At the same time, BMW is moving away from conventional module structures. With the cell-to-pack concept, the cylindrical cells are integrated directly into the battery housing.
The battery is also becoming a structural part of the vehicle. Under BMW’s pack-to-open-body concept, the storage system is integrated into the body structure, helping to reduce packaging requirements, lower weight and improve material efficiency.
Digital quality assurance for Gen6 ramp-up
The production system is designed for further scaling. A second production line is already under construction, while the site is expected to employ up to 1,600 people once fully ramped up from 2027. BMW plans production of several hundred battery packs per day.
Digital tools play an important role in quality assurance during the ramp-up. Digital twins, AI-supported process planning and continuous inline data monitoring are intended to identify deviations directly in the production process and enable corrections at an early stage.
This approach is particularly relevant as battery production becomes more deeply integrated into the vehicle manufacturing system. Quality issues in cell assembly or pack integration can have a direct impact on later production stages, making real-time process monitoring increasingly important.
BMW tests direct battery recycling
BMW is also expanding its activities around closed-loop battery materials. Together with the joint venture Encory, the company is testing direct recycling processes intended to reduce the need for primary raw materials such as lithium, nickel and cobalt.
The Cell Recycling Competence Center in Salching, located close to the new battery assembly operation in Irlbach-Straßkirchen, began operations in December 2025.
BMW uses a patented direct-recycling process at the site. Unlike conventional pyrometallurgical or hydrometallurgical methods, the process avoids energy-intensive thermal or chemical treatment.
Instead, electrode materials are separated mechanically and processed for reuse while largely retaining their material structure. BMW says the process can reduce energy consumption by up to 80 per cent compared with conventional recycling methods.
The approach is intended to keep valuable battery materials within the regional production network and improve the circularity of battery manufacturing.
Assisted driving becomes part of the Neue Klasse strategy
Beyond production and battery technology, BMW is also expanding the software functions of the Neue Klasse. With its Symbiotic Drive system, the company is targeting approval under UN Regulation No. 171 for Driver Control Assistance Systems.
One of the system’s key functions is a cooperative braking feature. When adaptive cruise control is active, the driver can intervene gently with the brake pedal to adjust the distance to the vehicle ahead without fully deactivating the assistance system. After the intervention, the system resumes the previously selected speed.
BMW also plans hands-off driving on suitable motorway sections at speeds of up to 130 km/h, while camera-based driver monitoring ensures that the driver remains attentive.
Approval under UN ECE R171 would provide the regulatory basis for a wider rollout of the system across Neue Klasse models in Europe. Software and homologation requirements for other major markets, including the United States and China, will have to be addressed separately.
Parallel production strategies increase complexity
BMW’s transformation nevertheless comes with significant operational challenges. Manufacturing in Germany remains exposed to comparatively high labour and energy costs, which places additional pressure on automation, productivity and plant utilisation.
At the same time, the company is operating two different production approaches in parallel. Munich is moving towards a dedicated electric architecture, while Dingolfing continues to rely on flexible production structures for combustion-engine and plug-in hybrid vehicles.
The success of this strategy will depend in part on whether BMW can achieve sufficient scale in Gen6 battery production while keeping production costs under control.
The company can already point to growing electric-vehicle volumes. BMW has now delivered more than two million fully electric vehicles worldwide. For the production network, this is not only a sales milestone. It also demonstrates that the systems, supply chains and manufacturing structures behind the electric-vehicle strategy are moving into significantly larger volumes.
