BMW will
invest $ bn to build a car plant in Mexico, following other premium automakers and
trying to use the low-cost location.
The plant
will have an annual capacity of around 150,000 vehicles, with production
expected to begin in 2019. BMW will build it near San Luis Postosà and create
an initial 1,500 jobs.
Last year, the BMW group sold almost 2m vehicles.
“BMW will be
even better positioned to take advantage of the growth potential in the
region,” said Harald Krueger, BMW board member for production. “We are
continuing our strategy of ‘production follows the market’.”
BMW will
join premium rivals Audi and Daimler in setting up plants in Mexico to benefit
from its low labour costs and the North American Free-Trade Agreement, which
provides access to the key US car market, the world’s second largest.
Mexico is
already the world’s fourth-biggest car exporting country and investments
totalling $10bn are expected in coming years. The industry represents 4 per
cent of Mexico’s GDP and nearly a quarter of total exports.
BMW is
trying to preserve its lead as the world’s biggest premium carmaker by sales in
the face of a challenge from Mercedes-Benz, which is launching a range of
sporty new models.
In March BMW
announced a $1bn expansion of its sports utility vehicle plant in Spantanburg,
US, which will become the largest in BMW’s plant network. It is also expanding
a carbon fibre plant in Moses Lake, Washington, which produces raw materials
for its i3 and i8 electric vehicles. BMW will also open a plant in Brazil later
this year.
