BMW’s growth strategy would see local production of electric MINI vehicles in China
BMW Group has signed a “letter of intent” with Chinese manufacturer Great Wall Motor, which would see it produce electric MINI vehicles in country. Its next steps will be to agree on the details of a possible joint venture and cooperation agreement and clarify aspects such as the choice of production location and concrete investments.
Production of the first battery electric MINI will begun at the main MINI plant in Oxford starting in 2019.
BMW has said it has no plans to set up an additional sales organisation in China, and is “firmly committed” to continuing the successful cooperation under the established sales structure.
Independently of its strategic considerations towards the MINI brand, the BMW Group will further expand its BMW Brilliance Automotive (BBA) joint venture in China with its partner, Brilliance. In addition to its two automobile production locations, BBA already runs an engine plant, which includes a battery factory for electrified BMW brand vehicles produced locally in Shenyang. This is the first battery factory operated by a premium automobile manufacturer in China.
Around 560,000 BMW brand vehicles were delivered to customers in China in 2017 – more than in the next two largest markets, the US and Germany, combined. In 2017, China was MINI’s fourth-largest market, with around 35,000 units delivered.
The expansion of the BMW brand in China has not led to a decrease in production at the company’s German plants. On the contrary, between 2007 and 2017, production in Germany increased by close to a quarter to around 1.15 million vehicles per year. At the same time, almost half of all BMW production now takes place at plants outside Germany.
Keen to preclude any worries of a withdrawal from the UK in light of Brexit, the group added that: “A similar growth strategy could accelerate development of the MINI brand significantly without questioning the BMW Group’s commitment in the UK.”