US EV Market: BMW’s $1.7bn South Carolina Investment

BMW Group has amplified its EV manufacturing presence in the United States after a US$1.7bn investment in South Carolina.

Its operations within the state have been boosted by the construction of Plant Woodruff and expansion of Plant Spartanburg.

Alongside these investments, the global car business is increasing its focus on the BMW X5 as it becomes the first fully electric BMW vehicle assembled in the US.

"Our strategic course remains unchanged,” explains Milan Nedeljković, CEO of BMW Group.

“We will continue to pursue the same technology-open strategy that has made BMW successful and will continue to make us successful in the future."  

Sebastian Mackensen, CEO of BMW of North America, says: "Our customers both in the US and around the world will love the new BMW X5 – and our technology-open approach puts them in the driver’s seat to enjoy the performance and premium experience that define BMW, regardless of which drivetrain they choose." 

Electrifying the BMW X5

BMW began production of the X5 in September 1999, and more than 3.1 million vehicles have been sold worldwide.

Shifting the model over to fully electric has been a steady process for BMW, first introducing the X5 xDrive40e in 2016.

The company has now announced plans to begin production of the first fully electric X5 in December 2026 and aims for full delivery in spring 2027.

EVs in the US

The EV market in North America was changed forever in May 2025 after the One Big Beautiful Bill Act was officially announced by US President Donald Trump.

This announcement brought a huge rise in EV purchases as customers looked to take advantage of the US$7,500 new EV tax credit before its termination in September.

According to Cox Automotive, 438,487 EVs were sold in Q3 of 2025 in the US, which was a 40.7% rise from the previous quarter.

South Carolina, where BMW has announced its investment, saw US$1.5bn worth of EV investments cancelled, which is the sixth-highest out of any state since 2025 according to research from Atlas Public Policy.

Challenges for the EV market

This spike in EV sales across North America failed to translate into 2026.

Bloomberg predicts that sales are set to fall by 19% this year, and just 24% of the nation’s fleet will be electric by 2040.

The US$7,500 incentive was a key factor for customers and its removal is continuing to have an impact on the overall sales across the US.

According to the World Resources Institute, an estimated US$20bn in announced EV manufacturing investments have been cancelled since 2025.

Several major car manufacturers have axed some plans to produce fully-electric vehicles in the coming years, including Ford, Porsche, Honda and Kia.

Ford, for example, cancelled its US$2.8bn investment plan to produce electric trucks at BlueOval City in Stanton, Tennessee. 

A survey conducted by Pew Research Center revealed that around 53% of Americans are unwilling to dive into the fully electric market.