BMW is exploring plans to construct its high vendor — the X3 compact crossover — at its underutilized Mexico meeting plant, based on a manufacturing forecaster who has familiarity with the discussions.
The transfer would free capability at BMW’s maxed-out U.S. manufacturing facility to fulfill buyer demand for its total line of crossovers.
With out revealing particular plans, BMW Group CEO Oliver Zipse stated crossover manufacturing will come to Mexico.
“Mexico will play an necessary position in our full setup,” Zipse instructed Automotive Information this month. “Sooner or later in time, you will notice X fashions as a result of the market demand is so excessive. That is all I can say proper now.”
BMW’s U.S. crossover gross sales are rising quick. The automaker offered 204,658 X-line autos within the U.S. final yr, up 55 % from 5 years earlier. As compared, the general luxurious mild truck section grew about 24 % throughout that interval, based on the Automotive Information Analysis & Knowledge Heart.
Whether or not sourcing the X3 from Mexico would imply having a second North American manufacturing facility line for it, or just relocating the mannequin there, stays unclear.
What is obvious is the mannequin’s market recognition in America. In 2021, the X3 was the highest-selling luxurious compact crossover within the U.S., with file gross sales of 75,858, or 22.5 % of BMW’s whole U.S. gross sales.
The X3’s U.S manufacturing facility, BMW’s largest auto meeting plant globally, is in Greer, South Carolina, close to Spartanburg. It additionally builds the X4, X5, X6 and X7 utility autos, and is a worldwide manufacturing hub for crossovers.
However the plant operated at 96 % utilization in 2021, based on knowledge from AutoForecast Options. The X3 accounted for about 27 % of its output final yr, based on AutoForecast.
Shifting its meeting to Mexico may unlock capability within the U.S. to develop manufacturing of different crossovers. Manufacturing of a brand new crossover begins within the fourth quarter of this yr with the XM plug-in hybrid crossover — BMW’s strongest M automobile, combining a V-8 engine and a high-performance electrical motor to generate as much as 750 hp.
BMW’s $1 billion Mexico operation, a 45-minute drive southeast of San Luis Potosi, builds the compact 2 and three Sequence sedans.
LMC Automotive forecasting chief Jeff Schuster stated the manufacturing facility operated at simply 42 % of its 175,000-vehicle capability final yr.
“The plant has almost sufficient house to soak up the present X3 quantity in South Carolina,” stated Schuster, who was not conscious of plans to maneuver X3 manufacturing to Mexico.
“It would not require vital funding and retooling to convey the X3.”
The Mexico manufacturing hub sprawls throughout almost 750 acres, surrounded by miles of dusty scrub land. The manufacturing facility occupies barely 1 / 4 of the location, indicating huge potential for additional improvement.
It may match the manufacturing scale of BMW’s South Carolina manufacturing facility, which has the capability to end up 450,000 autos a yr.
On the manufacturing facility opening in 2019, Zipse instructed Automotive Information, “The dimensions of the Mexico plant is large enough to achieve comparable capability if market demand is there.”
Final yr, BMW invested $125 million in a brand new manufacturing line to construct its 2-Sequence compact sports activities automobile.