BMW to continue to invest in China beyond Shenyang project
Updated 07:00, 29-Oct-2018
Munich-based BMW announced earlier this month that it would extend the contract term of the joint BMW Brilliance Automotive (BBA) venture in Shenyang, the capital of Liaoning Province, and increase investment in expanding its production capacity.
Meanwhile, the BMW Group will invest more than three billion euros (3.5 billion US dollars) in new and existing plants in Shenyang over the coming years.
In the following three to five years, the total annual production capacity of BMW automobiles at the BBA plants will increase to 650,000 units, creating 5,000 new jobs.
"We are a global company and, for many years now, we have successfully followed the strategy of 'production following the market.' Apart from the European Union (EU) as a whole, China and the US are our two biggest single markets worldwide and our plants in Shenyang and Spartanburg are cornerstones of our global production network," Nicolas Peter, the company's chief financial officer (CFO), said.
"We have invested billions into both locations in recent years and will continue to invest in them in the future," Peter added.
He also noted it was not efficient for a global company to solely build all models "local for local," but to have a complementary network with production facilities supplying several markets and regions with certain models.
"That's why the BMW Group is committed to free trade worldwide. Our company has a global production network and a global sales market. Barrier-free access to markets is, therefore, a key factor not only for our business model but also for growth, welfare, and employment throughout the global economy," he said.
"We therefore believe that any further escalation of the trade conflicts would be harmful for all stakeholders," Peter continued.
Talking about BMW's new plant in Shenyang, Peter said "we were celebrating 15 years of a strong and reliable partnership with Brilliance and at the same time laying the foundation for further growth of the BMW brand in China."
According to him, BMW Group highly appreciates China's central and local governments' resolution to set a new equity structure.
A press release posted on BMW Group's website showed that the company intends to increase its stake in BBA from 50 to 75 percent.
This transaction is subject to the approval of the relevant authorities and the consent of its partner's shareholders' meeting, it said.
Peter believed that the new set-up of the partnership is to realize further growth of BBA, a move which will eventually benefit all parties involved.
"We can further increase our efforts in promoting electro mobility. The new plant in Tiexi will be able to build vehicles with fully electric, partially electric and conventional drivetrains on a single production line," the senior executive said.
"With this highly flexible production system, we can respond quickly to market demand and would be able to ramp up production of electric vehicles to 100 percent of our output," Peter added.
Source(s): Xinhua News Agency