BMW increasing Spartanburg production to 200,000 yearly


BMW Manufacturing in South Carolina will bring on production of the X3 at year’s end, taking over for Magna Steyr in Austria.
May 22, 2007

BMW will increase production at its Spartanburg County, SC, plant from 140,000 vehicles last year to 200,000 vehicles by 2009. That’s a result of increasing X5 production, and adding production of the X6, minus a slight dropoff in production of the Z4, then bringing production of the X3 from Europe to the U.S. a year from now The beginning of the ramp-up will see about 165,000 vehicles built this year.

The move should help BMW with the strong euro and weak dollar, especially since so many of the X3 (31,291 sold here in 2006) and X5 models are sold in the U.S. BMW lost about $900 million in foreign exchange rates last year.

“With this we're reducing our foreign exchange risks for the U.S. dollar," said Norbert Reithofer, BMW AG CEO and erstwhile BMW Manufacturing manager at BMW’s company's annual meeting in Munich last week. "This is a part of our future strategy."

BMW currently builds the X5 and Z4 on shared assembly lines and the plant can accommodate most any combination so long as the two - soon to be four - models don’t go past the total plant capacity. The X5 production is expected to double to 130,000 per year while the Z4 will likely drop from 38,000 last year to 35,000 this year. Add in the X3 and pending X6 and you’ve got 200,000 vehicles a year. BMW hasn’t said if it will be hiring more employees. Currently the plant has 4,500 full-time employees and another 1,000 long-term temporary employees. While the long-term temps have many of the full-timers’ benefits, they can be let go should demand slacken, which lets BMW keep intact its reputation for not laying off employees.

As part of the plant changeover, visitor tours are being suspended as of the end of May. (What few tours remain have been subscribed already.) They would likely resume early next year or late this year.