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BMW May Build Fourth Model in US - Possibly 3-Series Sedan
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10-16-2010, 05:40 PM | #1 |
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BMW May Build Fourth Model in US - Possibly 3-Series Sedan
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BMW is considering adding a 4th model to be produced at the Spartanburg, S. Carolina plant, to further compete with Lexus and Mercedes in the U.S. The 3-series (perhaps starting with the next generation F30/F32 3-series) may wind up being that extra model, given its high volume and Mercedes' announcement last year that its Alabama factory would also begin building its C-Class. BMW has just completed a $750 million expansion of the Spartanburg plant to make room for the all new X3, which will join the X5 and X6 as the 3 models currently being produced at Spartanburg. An additional "volume" model for the U.S., could be added in South Carolina, said Frank-Peter Arndt, BMW's production chief. The introduction of a fourth model would help reduce BMW's exposure to foreign currency, which presently tops US$14 billion. IHS Automotive analyst Rebecca Lindland believes the 3-series is the most likely candidate for production at Spartanburg: "The 3-Series is a no-brainer." she said. For U.S. customers, this could possibly mean reduced waiting times for custom ordered 3-series in the future. Currently, approximately 70% of the vehicles built in Spartanburg are exported. Source: Bloomberg
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10-16-2010, 06:13 PM | #3 | |
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Are you saying that because something is made in America, it's quality is automatically suspect? Tom |
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10-16-2010, 06:51 PM | #4 |
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I have a 3 series built in South Africa, the the last one was built in Liepzig - the quality is almost identical, in fact, the SA car fit/finish may actally be a bit better. Even Toyota and Honda build a bad one occasionally - we had an ES350 lexus that had all sorts of issues.
I think it's more of what QA system the mfg uses than the nationality of the workers used to assemble the cars. Even UAW built cars have improved significantly in quality, we're a long ways from the build quality of the 70's that got folks flocking to Honda and Toyota. I'd buy a NA built 3 series without question, would probably go pick it up over at the factory.
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10-16-2010, 06:54 PM | #5 | |
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The way I see it, if that plant is going to be producing all the 3-series for North America, they are going to need many workers for those assembly lines. This plant could potentially mean alot more jobs. I think this is great.
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10-16-2010, 06:55 PM | #6 |
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No, BMW (like any brand) prices their cars 'competitively' for any given market. Actually, BMW's profit on the US market is a bit on the low side.
Best regards, south
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10-16-2010, 07:23 PM | #7 | |
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If BMW decides to manufacture the next 3-series sedan in the US, they would be able to do the same and make the entry-level 3-series models more competitively priced. I'd say that there's actually a pretty good chance of this happening. They clearly can not meet all US demand with US production, but they could produce a good portion of what is needed of their volume-leading and most price-sensitive models -- 328i and 328xi sedans (or whatever the equivalent model is on the next generation).
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10-16-2010, 07:30 PM | #8 | |
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In addition, any halfway decent manufacturing company is going to have have standards, methods, and procedures replicated across every facility to ensure identical production. They're not going to reinvent the 3 series production line from scratch, they're going to copy what they've got. Last edited by sor; 10-16-2010 at 07:35 PM.. |
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10-16-2010, 07:34 PM | #9 |
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what might this mean for ED of a future 3-series?
also, should we speculate that if indeed the 3-series will be the 4th model produced in Spatanberg, that it would make sense to begin with the F30? or would there even be time between now and then to ramp up for production of the F30 in 2012? |
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10-16-2010, 07:39 PM | #10 | |
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look no further than the quality difference between the VW Golf (Mexican) and the GTi (German) i don't think anyone can make cars better than the germans and i don't mean german design and american labour i mean german everything |
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10-16-2010, 07:40 PM | #11 |
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This would mean one bad thing for a potential 3 series buyer...
NO EUROPEAN DELIEVERY!!!! This would definetly put off a lot of people to buying one unless they were able to still do an ED. Plus it would cost a bit more money.
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10-16-2010, 08:24 PM | #14 |
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I guess they are expecting USD to remain weak for quite some time?
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10-16-2010, 08:35 PM | #15 | |
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That said, BMW still might drop ED on a 3, but I kinda doubt it. The savings involved might not be as much as they are now. In fact, I might be tempted to buy a ED 3 just to make sure I get a German-made one. |
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10-16-2010, 08:58 PM | #17 | |
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10-16-2010, 09:07 PM | #18 | |
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10-16-2010, 09:17 PM | #19 |
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10-16-2010, 09:32 PM | #20 | |
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I've owned an MKII GTI 16V that was "assembled" in mexico, E36 M3, E46 Zhp, and currently an MKV jetta. I hate to tell you this but quality is not dependent on the "country" of manufacturing; rather, it is dependent on the product quality, employee training, and management. Take my MKV jetta for instance; comparing it to MKII and MKIII GOLF, and JETTA, MKV Jetta surpasses quality and build craftsmanship. Why? Maybe VW began to realize that competition has caught up to them. Maybe VW realized that "hey, if we have to compete on a global level we need to up our quality". Maybe VW began feeling the heat from the Japanese automakers. Pay attention to what happened to Mercedes Benz when they decided to "merge" with Dodge/Chrysler. They thought that building a car inexpensively would add to bottom-line profit. Wrong! Quality began to slip dramatically. MB began using "inexpensive" material to build their vehicles. BMW is facing many dilemmas-the rising cost of labor in Germany, Global competition, and the devaluation of the dollar vs the rise of the Euro currency. Don't discount the fact that purchasing materials have also increased in price. |
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10-16-2010, 09:44 PM | #21 | |
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I assume a similar tax is imposed in the USA. Custom ordering would be simplified and orders could be delivered quicker and factory delivery would be more widely embraced. This would also create additional jobs in the area and help to boost an ever declining economy. This sounds like a great opportunity for BMW and North America as a whole. Mercedes as well, look for Audi to follow suit and setup shop too or move more Audi production to Mexico.
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10-16-2010, 10:01 PM | #22 |
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I still think it's for financial reasons. BMW can balance its raw material cost better with sale price. If they buy raw material in euro and receive sales in
Usd they will be hit hard with currency fluctuation, unless they raise US msrp significantly. What I want to know is how german government will react given it's a export economy, moving 3 series production abroad must have a significant reduction to GDP
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