From The Horses Mouth - BMW China Deal

July 2002

State Council approves project proposal for joint venture between BMW Group and Brilliance. Next step is verification of feasibility study.

Munich. The project proposal for a Sino-German joint venture in China between the BMW Group and the Chinese car manufacturer Brilliance has been approved in written form and released by the State Council of the People's Republic of China, 2002. Thus, the first step of the approval procedure for the planned market entry of the BMW Group has been successfully completed.

The next step will be the submission of a detailed feasibility study and the joint venture contract prepared by the BMW Group and Brilliance. The date for the setting-up of the joint venture has not been determined yet.

Start of production is scheduled for the second half of 2003. The annual production capacity is planned to total 30,000 units of the BMW 3 and 5 Series. The location of the joint-venture factory will be Shenyang, the capital of the Province Liaoning in the North-East of the People's Republic of China as well as one of the most important industrial centres of the country.

The market entry into the People's Republic of China is an important part of the Asian strategy of the BMW Group. The market entry conditions as well as the potential co-operation partners for a local factory were carefully examined beforehand.

The BMW Group has been present in China with a representative office in Beijing since 1994. Within the first six months of 2002, the company has sold 6,946 automobiles in Greater China (+22.7% compared to the previous year).