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      08-06-2012, 11:04 AM   #1
Jason
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Post BMW Considers Mexico Plant for 3 Series and 1 Series FWD Models Production

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BMW Considers Mexico Plant for 3 Series and 1 Series FWD Models Production
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According to a report from Automotive News, BMW is considering adding a second North American plant - in Mexico. It would join the Sprtanburg, SC plant as the only other BMW plant in N.A.

Production at the Spartanburg plant has included the X5, X6, X3, and Z4 (no longer built in Spartanburg) and will soon include the X4 SAV. The potential Mexican plant would expand that to the 3 Series and future FWD 1 Series models. Production would set to begin at the plant in late 2016 / early 2017.

As many as four Mexican locations are being considered, with a decision due next year. Should it be built, the Mexican plant would eventually produce 100,000 - 150,000 vehicle annually, but start by producing no more than 40,000 - 50,000 vehicles, initially.

Building cars in Mexico is attractive for BMW because the country has trade agreements with North America, South America and some Asian countries. Trade among Mexico, Europe and the Mercosur countries of Brazil, Argentina, Uruguay and Paraguay is duty-free. BMW also considered some potential U.S. sites, but they have been ruled out.

Also attractive is that by shifting some 3 Series production to Mexico from Germany, BMW would be shielded further from currency fluctuations and could avoid expansion in the economically troubled euro zone.

And producing the 3 Series in Mexico would allow the company to price it more competitively against its biggest competitor, the Mercedes-Benz C class. Mercedes will produce the C-class sedan at its factory in Vance, Alabama starting in 2014.

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