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BMW to Build Plant in Mexico

July 07, 2014

Harald Krüger, member of the BMW AG Board of Management, and Mexican President Enrique Peña Nieto announce the plant in Mexico. Photo courtesy of BMW.
Harald Krüger, member of the BMW AG Board of Management, and Mexican President Enrique Peña Nieto announce the plant in Mexico. Photo courtesy of BMW.

The BMW Group will build a new plant in Mexico in close proximity to the city of San Luis Potosí in the state of the same name. This move is in line with the company’s clear strategic policy of ensuring globally-balanced growth, according to the automaker.

“Mexico is an ideal location for the BMW Group and will be another important plant within our production network. We will invest $1 billion in the new production site over the next few years. Production is planned to start in 2019 and during that year, the workforce will reach around 1,500 people,” said Harald Krüger, member of the BMW AG Board of Management, responsible for Production.

Over the medium term, several thousand jobs will be created on the plant site and in the surrounding area, according to the automaker. The company will announce which BMW models will be built at the San Luis Potosí location at a later date.

“This decision underscores our commitment to the NAFTA region. We have been building BMW cars at our U.S. plant in Spartanburg for the past 20 years. With a planned annual capacity of 150,000 units for the new plant in Mexico, the BMW Group will be even better positioned to take advantage of the growth potential in the entire region,” Krüger said. “The Americas are among the most important growth markets for the BMW Group. We are continuing our strategy of ‘production follows the market’.”

The automaker said that the large number of international free trade agreements – within the NAFTA area, with the European Union and the MERCOSUR member states, for example – was a decisive factor in the choice of location. Other crucial advantages were the highly-qualified local workforce, a solid network of established suppliers and the well-developed infrastructure.

The BMW Group has operated a local sales company in Mexico since 1994 and sold a total of 13,992 vehicles in the country in 2013. This represents an increase of almost 18.3 percent over the previous year. Motorcycle sales for the same period reached 2,064 units (+16.6 percent).

The BMW Group has also announced a further investment of $1 billion at its existing plant in Spartanburg, S.C.. This will increase that plant’s annual production capacity to up to 450,000 vehicles by the end of 2016 and make Spartanburg the largest plant in the BMW Group’s international production network, according to the automaker.

A further $200 million will be invested to expand the joint venture carbon fiber plant in Moses Lake, Washington. This will triple local production capacity over the long term, according to BMW. The BMW Group will invest a total of $2.2 billion in the NAFTA region in the period up to 2019.

In parallel, the BMW Group is currently building a plant in the state of Santa Catarina in Brazil. The start of production for the Brazilian plant is scheduled for late 2014.

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