FILE PHOTO: Milan Nedeljkovic, BMW’s head of production, speaks during the announcement of a multimillion dollar expansion at the plant of German automaker BMW in San Luis Potosi, Mexico February 3, 2023. REUTERS/Toya Sarno Jordan/File Photo
FILE PHOTO: Milan Nedeljkovic, Member of the Board of Management of BMW AG responsible for production speaks at a press conference, on the BMW Group's investment for the MINI production in the UK, at the MINI plant in Oxford, Britain, September 11, 2023. REUTERS/Andrew Boyers/ File Photo

By Miranda Murray

BERLIN, Dec 9 (Reuters) - BMW named 30-year company veteran Milan Nedeljkovic as its next CEO on Tuesday to replace long-time chief Oliver Zipse, as the German automaker bets on a new generation of electric cars to counter U.S. tariffs, Chinese competition and Tesla.

The move, not unexpected with 61-year-old Zipse already beyond the usual retirement age, will put one of the architects of the new "Neue Klasse" EV range at the helm of the company at a time when cheap Chinese models are flooding the market.

Nedeljkovic, 56, will take over on May 14 and be expected to steer BMW back towards sales growth, particularly in China, the world's biggest auto market.

"The success of the Nedeljkovic era will be decided in China," said Moritz Kronenberger, portfolio manager at BMW shareholder Union Investment.

He also urged BMW to push ahead on autonomous driving, saying Level 3 capability - where cars handle many tasks but drivers must be ready to take over - needed to be rolled out across the range in future to keep pace with Tesla.

BMW shares, up nearly 25% this year and almost 50% since Zipse took the helm in 2019, were little changed after the news, signalling investors expect continuity.

MORE THAN THREE DECADES AT BMW

The shake-up makes BMW the second German carmaker in recent months to name a new CEO amid industry challenges, after Porsche picked former McLaren boss Michael Leiters.

Nedeljkovic, currently head of production, joined BMW in 1993 and has been central to developing the Neue Klasse, or New Class, EV platform.

"Neue Klasse represents the largest leap BMW has ever taken in investment and in technology, and so in our view it is good that one of its principal architects will lead the company as this gets progressively deployed," said Bernstein analysts.

Serbian-born Nedeljkovic studied mechanical engineering in Germany and Cambridge, Massachusetts, and rose from trainee to join the management board in 2019.

His CEO contract runs until 2031.

Supervisory board chair Nicolas Peter called him a "unifier and motivator," qualities he said were crucial for BMW’s transformation.

Metzler analyst Pal Skirta cited his flexibility and broad operational experience, including a stint at BMW's operations in Oxford, England, as strengths.

Zipse will resign by mutual agreement with the supervisory board on May 13, 2026, - the day planned for BMW's annual general meeting - after 35 years at the company.

He is expected to join Airbus' board of directors, the European aircraft manufacturer said earlier this year.

Zipse "has guided BMW through global crises such as the coronavirus pandemic and is the driving force behind the Neue Klasse, the company's most ambitious future project," said Peter.

(Reporting by Miranda Murray in Berlin and Paolo Laudani in Gdansk. Editing by Ludwig Burger, Alexandra Hudson and Mark Potter)