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July 3, 2017

BMW mulls Brexit and other issues ahead of Mini EV factory decision

BMW will decide by the end of September where to assemble its upcoming electric Mini, a top executive has said.

BMW will decide by the end of September where to assemble its upcoming electric Mini, a top executive has said.

Sales chief Ian Robertson told Reuters the electric Mini build decision, likely to be worth tens of millions of pounds, would come in the next three months and the board was currently considering a number of factories and factors including Brexit.

"One of the elements is what is the likelihood of a tax regime and if there's a tax regime, how would it apply," he said at the Goodwood Festival of Speed.

"If you made the motor in a German plant and you then assembled the car in a British plant, and you took the cars back to the German market, then the duty that you would pay would be reclaimed," he said, in an example of the options companies are examining to plan for any duties or tariffs.

Reuters noted Mini makes around 70% of its annual tally of approximately 360,000 cars at its Oxford plant in southern England but the car industry is concerned about the effect any loss of unrestricted access to the EU, its largest export market, could have on plants after Brexit.

BMW is deciding between its English site, contract build at NedCar in the Netherlands where it has had more of its conventional models assembled in recent years, and BMW plants in Leipzig and Regensburg for the new EV. The latter two have never built Minis but Leipzig makes the all electric and range extender i3 models for BMW. Mini has also contracted assembly to Magna Steyr in Austria – which specialises in niche models – in the past.

Robertson told Reuters the automaker is also looking into where the uptake of greener models is strongest and where the best supply chains are.

Robertson told Reuters there was an "open channel" with British officials and that he had several meetings with the Brexit ministry and with business minister Greg Clark, who has visited BMW in Munich, with their teams in regular contact.

But, asked whether the UK government could make promises now regarding future tax or tariff arrangements as BMW neared its decision, he said he did not believe that ministers were in a position to do so.

"Any of these discussions about a guarantee, it's not possible," he said.

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