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April 22, 2010

GERMANY: BMW mulls China X1 production

BMW is evaluating production of its X1 Sports Activity Vehicle at its Tiexi plant in the Shenyang region.

BMW is evaluating production of its X1 Sports Activity Vehicle at its Tiexi plant in the Shenyang region.

The facility currently builds BMW 3 and BMW 5 Series models for the Chinese market.

“We are currently exploring this possibility together with the authorities here in China,” said BMW chairman of the board of management Norbert Reithofer.

BMW adds it will also produce a successor to the 5 Series long wheelbase version in China, with build start slated for autumn this year. The long wheelbase version of the 5 Series has sold more than 70,000 models since 2006.

“We are confident this market will continue to see strong growth during the next few years,” said Reithofer.

“With our new plant in Tiexi, we will be increasing our production capacity in China to 100,000 vehicles a year from 2012.

“Over the long term, we anticipate the two plants having combined potential for as many as 300,000 vehicles a year – depending on market trends. We may realistically need this potential in the long term”.

The BMW Group will start construction of a new Chinese EUR560m (US$746m) plant in Shenyang this June with production due to begin in 2012. Some 1,000 jobs are due to be created.

China is currently the BMW Group’s fourth largest market worldwide, with the automaker selling more than 90,000 vehicles in mainland China. In the first quarter of 2010, the company increased deliveries by 106% to reach a total of 34,179 vehicles.

“China is, and will remain, one of the most attractive automobile markets in the world,” added Reithofer. In 2002 – before the plant in Shenyang was built and opened in 2003 – the BMW Group’s retail volume in mainland China was just under 6,700 vehicles.

According to the German Association of the Automotive Industry (VDA), a total of around 478,000 premium cars were sold in China last year. The Association estimates that the market for premium vehicles in China will grow to more than 1.5m units a year by 2020.

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