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24bn more investment of BMW in China to double production capacity

From:Internet Info Agency 2018-10-11 17:36:56

On Oct. 11, IIA gains the news from the BMW Group: In the context of the 15th anniversary of BMW Brilliance Automotive (BBA), the BMW Group announced together with its partner Brilliance China Automotive Holdings Ltd. (CBA) the early extension of the joint venture contract and the further deepening of the existing successful collaboration. The extended contract is valid for 22 years (from 2018 to 2040). At the same time, the joint venture also announced an investment of more than three billion euros in new and existing plant structures in Shenyang over the coming years. In the next 3 to 5 years, the total annual production capacity of BMW automobiles at the BBA plants will gradually increase to 650,000 units from the early 2020s, creating 5,000 new jobs.

According to the announcement, three billion euros investment is to upgrade and expand the new and existing plant in Shenyang. In Tiexi, a new plant on the existing plant ground will double the site’s capacity, while extensive remodeling and expansion measures will target the neighboring plant in Dadong. Production capacity there will remain the same, but the structure of the plant will gradually be expanded for future BMW model variants and the expected market growth.

“We are consistently following our growth strategy for China. With continuous investment, as well as the development and production of electric vehicles, we underline China’s importance as a dynamic growth market for us,” said Harald Krüger, Chairman of the Board of Management of BMW AG. “Our success story goes hand in hand with the success of the joint venture BBA. Together with our partners, we contribute to the sustainable development of the Chinese market,” he added.

“Over the past two decades, the BMW Group has participated in and benefited from China's reform and opening up. Facing the future, we are fully confident in China's further reform and opening up and the sustainable growth of the economy. China is becoming an important power of innovation-driven, especially in the digital arena. As an essential part of the BMW Group's global strategy, we will continue to invest more and wider in China, the largest single market for BMW, bringing more and better innovative products and personalized services to Chinese customers. “said Jochen Goller, President and CEO of BMW Group Region China.

“15 years of BMW Brilliance is a joint success story that we share with our partners and over 18,000 associates. With this additional investment, innovation and job creation, we will continue our high-quality development and drive economic growth in Liaoning Province,” said Dr. Johann Wieland, President and CEO of BBA.

The BMW Brilliance Automotive joint venture was founded in 2003. Over the past 15 years, it has become one of the most successful premium vehicle manufacturers in China, encompassing production and sales of BMW automobiles in China, as well as local R&D. In 2017, the BBA automotive plants in Tiexi and Dadong produced almost 400,000 vehicles for the Chinese market – an increase of around 30 percent year-on-year.

The advanced plants established by BBA in Shenyang are models for innovation and sustainable production, as well as the interface between Germany's “Industry 4.0” and “Made in China 2025”, and play a pioneering role in the revitalization of the finance in the Northeast Old Industrial Base and industrial upgrading. Since 2009, BMW Brilliance Automotive has invested more than 52 billion RMB in its plants in Shenyang, which has greatly driven the local economy and the automobile industry. Since the founding of the joint venture, the supplier network has expanded to more than 350 companies. More than 80 suppliers have set up locations in the Liaoning province. Since 2005, BBA has maintained the largest taxpayer in Shenyang, with a tax payment of over RMB 24 billion in 2017. Moreover, BBA has also employed more than 18,000 local employees in total, greatly contributed to the cultivation of local talents.

Currently, six BMW models are produced in Shenyang: Plant Tiexi manufactures the BMW 1 Series Sedan, the BMW 2 Series Active Tourer, the BMW 3 Series Sedan (including Long Wheelbase version) and the BMW X1 (including plug-in hybrid version). At Plant Dadong, the BMW 5 Series Long Wheelbase version (including plug-in hybrid version) and the BMW X3 are manufactured. From 2020, the fully-electric BMW iX3 will also roll off the production line at Plant Dadong, its sole production location, and be exported from China to markets worldwide.

“We are expanding our production system in Tiexi with a new plant. This new plant, together with the existing engine plant and battery factory, will put us in an ideal position,” according to Oliver Zipse, member of the Board of Management of BMW AG, responsible for Production. “With our 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.”

In addition to its two existing vehicle plants, BBA opened its own battery factory in Tiexi a year ago. In May 2018, the company laid the foundation stone for a major expansion of this battery factory. The new “High-Voltage Battery Centre Phase II” will produce new, more powerful batteries with fifth-generation BMW eDrive technology for the fully-electric BMW iX3.

The BMW Group will continue driving its development in China, the world's largest auto market, including the extension of the joint venture contract with BBA and further investment to increase production capacity of the Shenyang production base. This marks another achievement of deepening cooperation between China and Germany in the economic field. Chinese Premier Li Keqiang and German Chancellor Angela Merkel also sent congratulatory letters on the day of the event.

Editor:Bai Yunpeng