BMW Plans $1 Billion Expansion in Assembly Plant
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Germany-based BMW will invest $1 billion to expand the company’s assembly plant in Spartanburg, South Carolina.
Dr. Norbert Reithofer, Chairman of the Board of Management, BMW Group, said, “We will expand the plant’s annual production capacity by 50% up to 450,000 vehicles by the end of 2016. Today’s capacity is around 300,000 vehicles. This investment will also create an additional 800 jobs, increasing the total workforce to 8,800 on site.”
The additional investment will be used to increase capacity, which is necessary to meet strong global demand for BMW X models. “Plant Spartanburg was built to enhance and expand the BMW line-up, underscoring the BMW Group commitment to the United States” said Dr. Reithofer. “In addition to the X3, X5, X6, and the new X4, we are today announcing another all-new, larger X model to be manufactured exclusively at this plant for our world markets: the X7.”
Harald Krüger, Board of Management member for Production explained the important role of the US for the BMW Group production strategy: “The BMW Group strives for a good balance of growth among all markets and continents. The Spartanburg plant is an important building block in our international network of 28 production and assembly facilities in 13 countries today and makes a vital contribution to profitable, globally-balanced growth.”
“Our U.S. plant is the best example of our successful strategy of ‘production follows the market’. The state of South Carolina has supported us as a valuable and reliable partner throughout our 20-year involvement in the region, making the United States our second home,” he explained.
“We are expanding BMW Plant Spartanburg as our center of competence for production of BMW X models and broadening our product portfolio,” Mr. Reithofer said. “This expansion means Spartanburg will have the largest production capacity of any plant in our global production network. This plant already exports, on average, 70% of its annual production with a 2013 value of more than US$ 7.5 billion which, according to the U.S. Department of Commerce, makes BMW the largest U.S. vehicle exporter to non-NAFTA countries.”
“Plant Spartanburg was built to enhance and expand the BMW line-up, underscoring the BMW Group commitment to the United States”
Since production began 20 years ago, in 1994, the Spartanburg plant has produced over 2.6 million vehicles for BMW customers around the world. Currently the BMW X3, X5, X5 M, X6 and X6 M are all produced at the plant.
“This is the fifth expansion since production began 20 years ago and represents another major investment,” said Manfred Erlacher, President & CEO of BMW Manufacturing. “The increase in annual capacity, the number of models produced, and the number of jobs on site, reinforce the major role BMW is playing in the region’s economic vitality through technological innovation, environmental stewardship, and development of a highly skilled workforce.”
Questions & Answers
Q.What is the primary reason for BMW's substantial investment in the Spartanburg plant?
What is the primary reason for BMW's substantial investment in the Spartanburg plant?
The $1 billion investment is necessary to increase the plant's capacity, which will help meet the strong global demand for BMW X models. It also reinforces the company's commitment to the United States as a key production hub.
Q.Which new BMW X model will be produced exclusively at the expanded Spartanburg plant?
Which new BMW X model will be produced exclusively at the expanded Spartanburg plant?
The company announced that an all-new, larger X model, the X7, will be manufactured exclusively at the Spartanburg plant. It will be produced there for all world markets, alongside existing X models.
Q.How much will the production capacity increase and by when is this expected to be achieved?
How much will the production capacity increase and by when is this expected to be achieved?
The plant's annual production capacity will increase by 50%, from 300,000 vehicles to 450,000 vehicles. This expansion is planned to be completed by the end of 2016.
Q.What is the Spartanburg plant's significance in BMW's global production network regarding exports?
What is the Spartanburg plant's significance in BMW's global production network regarding exports?
The Spartanburg plant exports, on average, 70% of its annual production. With a 2013 value of over US$7.5 billion, it is described as the largest U.S. Vehicle exporter to non-NAFTA countries.
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