BMW Is Reportedly Revamping Slow-Selling i3 Electric Vehicle for 2017

BMW is taking another stab at its battery-powered i3 sedan, an innovative electric vehicle that failed to excite consumers, at least not sufficiently to satisfy the German maker of premium automobiles.

A German newspaper reported -- and BMW didn't deny -- that a restyled i3 with more range will debut next year. The move comes at a time when BMW and the two other German automakers, Volkswagen (VLKAY) and Daimler (DDAIF) , are preparing a wave of new EV models to comply with stringent emissions regulations.

The $45,000 i3 has sold moderately in the U.S., its availability restricted to California and a few other markets. Deliveries reached about 25,000 worldwide in 2015, placing it behind Tesla's (TSLA) Model S and Nissan's (NSANY) Leaf EVs.

BMW's first battery-powered electric symbolizes the conundrum facing automakers. Tough environmental laws compel them to develop emission-free models in order to keep selling conventional vehicles, yet most consumers are deterred by costly electric technology, as well as drawbacks such as shorter than typical range between charges.

Eddie Alterman, editor-in-chief of Car and Driver magazine, gave i3 high marks for innovative construction said said it's "expensive, strange-looking, and its range as a pure EV is limited."

The first version of i3 had a range of less than 100 miles, which BMW improved to about 120 miles with a more powerful battery. BMW also added a "range extending" two-cylinder gasoline engine that allowed the car to be driven up to 160 miles, without refueling or recharging. The body is fabricated from carbon-fiber reinforced plastic, a costly process meant to keep its weight extremely light.

Todd Lassa, Detroit bureau chief of Automobile magazine, said BMW didn't build a cult following, as Tesla did for its Model S. With gasoline cheap, consumers have less interest in saving money on fuel purchases.

"The i3 is a non-starter," Lassa said. "Simply a place-holder for when BMW is ready to get serious about a sub-$50k green mobile."

According to newspaper Welt am Sonntag, which broke the story of the new i3, BMW plans to restyle the front and the rear of the vehicle, presumably leaving the basic architecture intact, while further improving the range. Even so, i3 probably won't top 200 miles in range, which lately is regarded as a consumer threshold for models such as General Motors'  (GM) Chevrolet Bolt EV.

Dutch Mandel, publisher of AutoWeek, said EVs are fighting an uphill battle for consumer acceptance, which could improve as long as batteries get stronger. "We have come to understand we can live comfortably with an electric car, especially as range anxiety wanes with battery technology advancements," Mandel said.

Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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