BMW and its Chinese joint venture partner Brilliance have opened a new plant at Shenyang.
The second plant at Shenyang increases BMW’s China capacity to 200,000 vehicles a year with further investment earmarked to raise capacity further in the medium-term. BMW describes the new facility as ‘the most sustainable automobile production facility in China and one of the most innovative and flexible automobile production facilities worldwide’.
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The expansion underlines an upbeat assessment of prospects for premium segment sales in China. Analysts say that the premium segment of the car market is continuing to show good growth in China this year and point to rising replacement demand in the car market in the future as a source of further growth as first-time car buyers look to upgrade.
“Together with our partner Brilliance we will further invest EUR500m in China, thus preparing for future growth”, said Norbert Reithofer, Chairman of the Board of Management of BMW AG, at the opening ceremony in the city of Tiexi.
“With this investment we will increase total capacity of both plants to 300,000 units per year over the medium term. Due to our flexible production structure we will be able to produce up to 400,000 vehicles depending on market development,” Reithofer said.
BMW AG has been producing BMW 3 Series and 5 Series models for the Chinese market with Brilliance since 2003. The opening of the second vehicle plant in China will expand the range of locally-produced models to include the BMW X1. Production of the long-wheelbase version of the BMW 3 Series will also begin in Tiexi over the coming weeks.
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By GlobalDataThe two partners have also begun producing 2.0 litre four-cylinder petrol engines at a third location in Shenyang. The engine plant has an initial capacity of 200,000 engines, which will increase in line with the expansion of the two automobile plants. The launch of engine production will allow the joint venture’s two production locations in Dadong and Tiexi to be supplied locally. “The opening of the only engine manufacturing facility outside of Europe is a major step for BMW Brilliance Automotive and underlines our commitment to the growth market of China,” said Friedrich Eichiner, member of the Board of Management of BMW AG, Finance, .
BMW said that over the next few years more than 2,000 new jobs will be added to the roughly 8,000 already created in Shenyang.
BMW said that China was one of the BMW Group’s largest markets worldwide in the first four months in 2012, with 107,211 vehicles sold (+35%). The company remains confident for the year as a whole: “We expect sales in China to grow at a double-digit rate once again in 2012 and to achieve record deliveries,” added Reithofer. In addition to the start of BMW X1 production in Tiexi, the ramp-up of the long-wheelbase version of the new BMW 3 Series in the second half of the year will generate further momentum for sales, BMW said.
Last year, the BMW Group sold 233,630 vehicles in China – an increase of 37.7%. The BMW Group retail network expanded from 210 to 290 dealerships over the course of 2011.
See also: CHINA: BMW may build EVs in Shenyang
