BMW Celebrates Extension of Spartanburg SC Plant

By Henny Hemmes
Senior European Editor
Amsterdam Bureau
The Auto Channel

GREENVILLE, SC. October 15, 2010; This week, BMW celebrated the completion of the extension of the Spartanburg assembly plant. The decision for the construction of the 1.2 million sq.-ft. facility to accommodate the production of the new X3 was announced two and a half years ago, well ahead of the financial crisis.

“It is a statement of trust,” says Josef Kerscher, President of Spartanburg based BMW Manufacturing, “and I am grateful that the crisis did not influence the Board’s decision. The extension has been completed on schedule and within budget.”

The first car rolled out of what BMW internally calls ‘Plant 10’ in September 1994. Since then, in total some 1.6 million cars have been built. The new expansion increases the plant’s capacity by 50 percent to 240,000 in 2011. Some 1,600 new jobs are added to the current 6,000 jobs. Directly en indirectly, BMW generates jobs for 23,000 people in South Carolina.

Mr. Kerscher said that with the extension the plant is really flexible. “We have been practicing for a month by building the X5, and since September 1st we are building the new generation X3.”

The current X3 is built at the Magna Steyr plant in Austria, which now will get the new Mini Countryman instead.

After the second shift is added in November, daily production will be a 1,000 cars, of which 400 units of the X3 model. New for the American customers will be that they can order the X3 according to their own specifications and even will be able to change those specs until six days before the production date

X1 to arrive in 2011…?

During a presentation for the media in the plant’s auditorium, Jim O’Donnell, president of BMW North America, said that his company will introduce its small X1 model here in the first half of 2011. He said that this decision had been postponed earlier because of the success of this model on other markets.

Later on during the event, BMW Group’s board member Frank Peter-Arndt, did not want to confirm this. “To the contrary, there are no such plans.”

Mr.Kerscher said: “There are no plans to build the car in Spartanburg, We are happy that we have started the production of the X3.”

2011 BMW x3

“When we laid the foundations for this plant 17 years ago, we made a promise that BMW cars made in Spartanburg would excite and inspire people around the world,” said Frank Peter-Arndt, a member of BMW’s board of management. “I believe the X3 will open a new chapter in this plant’s already successful story.”

Kerscher said the Spartanburg plant officially started production of the X3 on Sept. 1 in its new Assembly North facility. The first models will go to Europe, and the U.S. models will be available during the first quarter of 2011.

About 900 employees eventually will be responsible for building the X3, the company said.

The plant currently is running one 10-hour shift and is building 150 X3s per day. A second shift will be added in November, which will bump up X3 production to 300 vehicles each day.

Two versions of the X3 will be available in the U.S. — a 240-horsepower xDrive 28i with a base MSRP of $37,625 and a turbocharged 300-horsepower xDrive35i with a base MSRP of $41,925.

“I expect this car will be as successful as the X5 or X6 has been,” Kersher said. “I expect it will be a leader in its market segment.”

Although the company has made no official plans to add another vehicle to its production lines in Spartanburg, Jim O’Donnell, president of BMW of North America LLC, said BMW will introduce its crossover X1 to the U.S. market in 2011.

He said the reason the company has not yet brought the vehicle to the U.S. is because it is so popular elsewhere in the world.

Since the start of production at the Spartanburg plant in September 1994, BMW has rolled out more than 1.6 million vehicles and invested a total of $4.6 billion.

A study by the University of South Carolina’s Moore School of Business said the company has created 23,000 jobs across the state.

BMW said it has hired 1,000 people for the 1,600 new contingency jobs at the plant. When hiring is complete, more than 7,000 people will work at the facility.

The company has used the expansion of the plant to develop sustainable methods of production.

On Monday, BMW announced that it would replace the battery operated systems on its materials handling equipment in the Assembly North plant with hydrogen fuel cells.(Complete Article Here)

The company already uses methane gas from the Palmetto Landfill to power about 50 percent of its energy needs at the plant. Improvements to the facility’s paint shop have reduced energy consumption by 30 percent and carbon emissions by 43 percent, BMW said.

New production processes implemented at the plant have reduced the plant’s water consumption by 30 percent and decreased the amount of waste sent to landfills by 12.5 percent, according to the company.

“As we’re nearing two decades since BMW’s initial decision to put down roots in South Carolina, it’s clearer than ever that the company’s decision in 1992 wasn’t just a win for one part of the state or even one generation of South Carolinians,” Gov. Mark Sanford said in a statement. “It was a transformational event in the history of our state.”

Sustainability

The 750 million dollar expansion also involves a 300,000 sq.ft. addition of the paint shop that is set up for IPP, Integrated Paint Process. This is a technology that is used in the Oxford plant in England that builds the Mini. In Spartanburg, IPP is completely electronically managed. It reduces several steps in the paint process.which leads to a decrease of energy use by 30 per cent, resulting in 43 per cent less CO2-emissions (or 92,000 tons) per year. In the meantime, productivity rises by 40 per cent. Methane gas is supplied by the Palmetto Landfill at some 9 miles distance from the plant. It powers around half of the energy needed at Plant 10.

With the expansion of the plant, BMW implemented several other measures for sustainable production. One of them is the use of hydrogen fuel instead of batteries for the carts that handle materials. The new production systems require 30 per cent less water, while also decreasing the amount of waste (sent to landfills) by 12.5 percent.

This summer the plant was ranked number one in J.D Power’s Sustainability Index for the sixth continuous year.

BMW also expanded the North American headquarters in New Jersey and constructed new regional distribution centers. Combined with the expansion of Plant 10, it required a total investment of 1 billion dollars. BMW says this was necessary because of the continuous world wide high demand for its all-wheel drive SAVs, and to centralize the expertise on those X-models. The philosophy of the Germans is to build their cars in the country where demand is highest. With the new extension, Spartanburg is even larger than the plant in Munich.

Two versions will be available of the new X3 for the North American market. Scheduled for arrival in the first quarter of next year are the xDrive 28i with 240 hp and the turbocharged xDrive 35i with 300 hp.

Stay tuned for the first test drive, which will be published here at The Auto Channel