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BMW to continue to invest in China beyond Shenyang project: CFO
source: Shenyang Municipal Bureau of Foreign Trade & Economic Cooperation  2018-10-30 16:38

BMW will extend the contract term of the joint venture BMW Brilliance Automotive (BBA). [Photo/VCG]

BMW Group has already invested billions and will continue to invest in China in the future, the German car company's chief financial officer (CFO) Nicolas Peter told Xinhua in a recent exclusive interview.

The Munich-based car maker announced earlier this month that it would extend the contract term of the joint venture BMW Brilliance Automotive (BBA) in Shenyang, the capital of Liaoning province, and increase investment in its production capacity expansion.

Meanwhile, the BMW Group will invest more than 3 billion euros ($3.5 billion) in new and existing plants in Shenyang over the coming years.

In the following three to five years, the total annual production capacity of BMW automobiles at the BBA plants will increase to 650,000 units, creating 5,000 new jobs.

"We are a global company and for many years now, we have successfully followed the strategy of 'production following the market'. Apart from the European Union as a whole, China and the US are our two biggest single markets worldwide and our plants in Shenyang and Spartanburg are cornerstones of our global production network," Peter said.

"We have invested billions into both locations in recent years and will continue to invest in them in the future," Peter added.

He also noted it was not efficient for a global company to solely build all models "local for local", but to have a complementary network with production facilities supplying several markets and regions with certain models.

"That's why the BMW Group is committed to free trade worldwide. Our company has a global production network and a global sales market. Barrier-free access to markets is therefore a key factor not only for our business model, but also for growth, welfare and employment throughout the global economy," he said.

"We therefore believe that any further escalation of the trade conflicts would be harmful for all stakeholders," Peter continued.

Talking about BMW's new plant in Shenyang, Peter said "we were celebrating 15 years of a strong and reliable partnership with Brilliance and at the same time laying the foundation for further growth of the BMW brand in China."

According to him, BMW Group highly appreciates China's central and local governments' resolution to set a new equity structure.

A press release posted on BMW Group's website showed that the company intends to increase its stake in BBA from 50 percent to 75 percent.

This transaction is subject to the approval of the relevant authorities and the consent of its partner's shareholders' meeting, it said.

Peter believed that the new set-up of the partnership is to realize further growth of BBA, which will eventually benefit all parties involved.

"We can further increase our efforts in promoting electro mobility. The new plant in Tiexi will be able to build vehicles with fully electric, partially electric and conventional drivetrains on a single production line," the senior executive said.

"With this 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," Peter added.

Editor: zfw05