BERLIN, Jan 15 (Reuters) – The tipping point for combustion-engine car sales has passed and most of the sales growth is now coming from electric vehicles, BMW AG (BMWG.DE)’s chief financial officer told a media roundtable.

“The tipping point for the internal combustion engine has already occurred,” CFO Walter Mertl said, adding that he thought it had passed last year.

“The current peak in sales of combustion-engine vehicles will continue and then decline slightly,” he predicted, noting that looming environmental regulations will limit sales of such vehicles.

Automakers are under pressure to increase their electric vehicle offerings as regulatory deadlines from China to the European Union and some U.S. states are set to ban the sale of new fossil fuel-emitting vehicles from the middle of the next decade.

BMW’s share of all-electric vehicle sales reached 15 per cent last year. The company plans to increase that share to 33 per cent by 2026, while introducing six new models in its ‘Neue Klasse’ range of purely electric vehicles.

Nonetheless, profit margins for BMW’s internal combustion engine cars and all-electric vehicles won’t reach parity until at least 2026, with Mertl pointing out the higher cost of introducing new battery technology for later models.

Mertl also said that cars in certain price ranges may also be discounted, but he didn’t give further details.

He added that the automaker will stick to its previously announced goals of selling 3 million vehicles by 2030 and achieving an 8-10 per cent profit margin in its automotive division, a conservative target that is lower than its expected 2023 margin of about 10.3 per cent.