BMW plans to produce 450K vehicles a year in Greer
03/28/2014 11:54 PM
03/28/2014 11:57 PM
When BMW began making cars in Greer 20 years ago, it planned on making 100,000 a year.
Today, its local plant makes three times that number, about 300,000 a year.
And BMW said Friday it plans to be making 450,000 vehicles a year in Greer by the end of 2016 – four and a half times the original number.
“It has definitely exceeded our expectations,” Harald Kruger, the BMW board member in charge of global production, said after the automaker announced it would expand the plant for the fifth time in two decades.
The plant was already a colossus – compared to any other factory in the Upstate – before BMW announced that it would add another 800 jobs, another $1 billion in capital expenditures and another model, the X7.
BMW said the expansion would bring its total Upstate employment to 8,800 and give the Greer plant more manufacturing capacity than any other BMW plant in the world.
The complex has become the largest U.S. exporter of vehicles to non-NAFTA countries, with about 70 percent of products sold abroad, according to BMW.
It’s the automaker’s global center for the production of X vehicles, making various versions of the X3, X4, X5 and X6 and soon, the X7.
It’s not clear, however, how much longer the Greer site will continue to grow.
On Friday, top BMW executives, including Norbert Reithofer, the company’s global chairman, weren’t talking about the future of the plant beyond 2016 as they celebrated the latest jobs announcement with the U.S. Commerce secretary, South Carolina’s governor, its two U.S. senators and at least three of its U.S. House members.
But a site plan that BMW filed recently with the Spartanburg County Planning and Development Department shows that the automaker has occupied most of about 1,000 acres along Interstate 85 it originally bought for the plant, especially after construction of a planned third body shop with 675,000 square feet of space.
And Kruger hinted Friday that the Greer site may be reaching its limits.
Asked if the plant had enough room to grow in the future beyond Friday’s announcement, Kruger said the 50 percent production boost to 450,000 vehicles a year was the equivalent of adding another plant.
“That’s enough growth really for the future,” he told The Greenville News. “With 450, you achieve a certain top level because then logistics gets very complicated and other things. But we are very happy with a ramp up to 450. This is adding huge capacity.”
There is at least one major investment that BMW could possibly bring to South Carolina in the future – an engine plant.
Asked about a recent news report out of Germany that BMW was thinking about building an engine plant in North America, Kruger told reporters that no decision has been made.
He said the decision depends on various factors such as production volume, which engines are needed and U.S. demand.
“That’s something you might think about in the future,” he said. “You need to evaluate and investigate the business case, but there is no decision on this one.”
South Carolina Commerce Secretary Bobby Hitt, a former BMW executive, didn’t seem worried about the automaker running out of room in Greer.
“There are always ways to economize and compact manufacturing. That’ll continue to be done,” Hitt said. “I think we have enough room here. We’ll always have enough room for BMW.”
As for an engine plant, Hitt said that decision is driven by volume and “when the volume is right somebody will make a decision about it.”
BMW’s 8,800 jobs total includes vendor employees and contract workers at the Greer site and information technology workers in Greenville, said company spokeswoman Sky Foster.
But the figure doesn’t include jobs that BMW executives and a University of South Carolina economist said were sure to follow at the automaker’s 40 suppliers in South Carolina.
Joey Von Nessen, a USC research economist working on a new study of BMW’s economic impact in South Carolina, said the automaker’s ripple effect is such that the state can expect three additional jobs for every one BMW creates.
Even without Friday’s announcement, BMW supports 30,000 jobs in South Carolina and accounts for $16.6 billion in annual economic impact, Von Nessen said.
BMW’s 8,800 jobs figure exceeds the Upstate jobs total for General Electric Co., which employs about 3,500 at two separate manufacturing sites in Greenville County, a GE spokesperson said.
The 8,800 jobs figure is also more than at The Boeing Co.’s North Charleston aircraft plant, where the number of jobs so far is just over 7,000, a Boeing spokesperson said.
But BMW’s employment total is just under the 8,900 people that Greenville-based Michelin North America employs at 14 sites in South Carolina, including its headquarters and a major research center in Greenville, according to a fact sheet from the French tiremaker.
Michelin spokesperson Lauren Davis said the 8,900 are all on Michelin’s payroll and aren’t employees of vendors or staffing agencies.
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