By on April 9, 2014

BMW Spartanburg

In its battle against Mercedes-Benz and Audi for record sales, BMW is mulling over the possibility of a second plant in North America.

Bloomberg reports the automaker would place its second factory in Mexico, with two sites under consideration. The decision to expand will take a few months according to BMW production chief Harald Krueger, Should the move be given a green light, the Mexican plant is likely to build the 3 Series.

The second factory would add to the long-term growth strategy BMW is using to fend off its German premium market competitors in a heated battle for records global sales, fueled by growing demand in the United States and China. Mercedes will add the C-Class to its Alabama facility in June with a new plant in North America due near the end of this decade, while Audi is in the middle of setting up shop in Mexico with a $1.3 billion plant set to produce crossovers beginning in 2016.

Previously, BMW announced it would invest $1 billion to expand its South Carolina plant by 50 percent in 2016, as well as add the X7 large SUV to the X Series lineup currently produced in the plant.

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25 Comments on “BMW May Build Second NA Plant To Fend Off German Rivals...”


  • avatar
    philadlj

    At the end of the day (or Geschäftsjahr), can’t these German automakers just be happy they’re selling so many cars and making so much money?

    The constant expansion of product and production and obsession with sales and market share…when does it end?

    How much is enough?

    DID THEY LEARN NOTHING FROM INVADING RUSSIA?

  • avatar
    Rod Panhard

    Even more interesting is the article on Automotive News reports that the South Carolina factory will become BMW’s biggest. That’s a lot of SUVs to export. Damn fascinating, actually….

    • 0 avatar
      Mike N.

      Understandable, given that South Carolina makes all the X cars other than the X1, for the entire world. The 3/4 series, BMW’s volume seller, is split between at 2, maybe 3 plants in Germany and one in South Africa (and probably one in China?).

      • 0 avatar
        wmba

        Except the secret factory already existing in Mexico. BMW has had a private deal going for 20 years in Mexico. The plant is not mentioned on BMW’s global website, but it is there and they make X5s.

        http://en.m.wikipedia.org/wiki/BMW_Mexico

  • avatar
    DeeDub

    When I think “exclusive prestige”, I think “Hecho en México”.

  • avatar
    28-Cars-Later

    I’m already not buying a German car after MY95, but I will enjoy a certain amount of schadenfreude informing yuppie jagoffs of their future faux exclusive Audi and BMW’s assembly location.

  • avatar
    Mandalorian

    Why not build another plant in GERMANY?

    • 0 avatar
      CJinSD

      Because of the Greens and the Reds.

      • 0 avatar
        Vega

        You mean the greens and reds who passed the biggest liberalization in German labor laws since WW2?

        http://en.wikipedia.org/wiki/Agenda_2010

        Reality is sometimes more complex than conservative talking points.

    • 0 avatar
      Vega

      Because producing in Germany and selling in the US exposes you to nasty transactional currency risk. Nothing to do with Reds and Greens, the last major production site they opened in the West was Leipzig, Germany in 2005.

  • avatar
    RogerB34

    New plants will not be built in Germany.
    The Social Democratic Party, center/left, shares power with Merkel’s party.
    Means more redistribution and less business incentive to expand.
    The German economy is weak and the EU is on life support meaning contracting auto demand.

    • 0 avatar
      alsorl

      Yes, Porsche and Audi is doing so poorly due to the German government.

    • 0 avatar
      krhodes1

      More like it just costs a lot more to build in Germany. Both because of labor costs and because the Euro is still very strong vs. the dollar. American and Mexican robots are just as good as German ones anyway.

      To me the only bummer is that there will be fewer choices for European Delivery. The design is the important part, not where it is bolted together.

    • 0 avatar
      Vega

      Yeah, the German economy is not weak. Maybe try a more balanced diet of news sources…

      http://www.telegraph.co.uk/finance/comment/liamhalligan/10670316/We-should-be-learning-from-Germanys-revival.html

  • avatar
    ellomdian

    Is there really such a bad wait list that the market is defined by limited production and not demand? I don’t think either of the large BMW dealers in my Major American City has ever had to wait more than 2 weeks for a car that wasn’t ordered to spec – and those typically account for less than 10% of the vehicles sold there, last I heard.

    When VW started doing it, it was justifiable because they had Mercedes-penis-envy. What does BMW (or VAG) have to gain from increasing output if the demand isn’t there?

    • 0 avatar
      Aaron2013

      hehe ellomdian said, “VAG”, hehe

    • 0 avatar
      krhodes1

      Wait lists in other parts of the world can be much, much longer. And ultimately, it makes sense to build 3-series here (meaning North America) for the exact same reasons it makes sense to build Camrys here.

    • 0 avatar
      Vega

      “because they had Mercedes-penis-envy” Amusing, but a more rational view would be to offset currency fluctuation and to build market-specific vehicles (like the US Passat). They may not always be right, but car companies usually don’t make long-term investment decisions just to one-up the other guy.

      • 0 avatar
        ellomdian

        I honestly have to wonder when it comes to the German Big 3. All they talk about promotional-wise is global production numbers – efficiency and logistics are small, unsexy bullet points at most. While it may make sense to build cars in NA that sell well in NA, unless there is an increase in demand overall, you are eventually decreasing the cars you build elsewhere, say, in Germany, and that usually means a decreased labor need (which is none to popular regardless of your home state/country.)

        And this is the car company that bought Ducati (effectively out-from-under Mercedes) because… racecar?


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