BMW spending 9 million euros to boost Thai output

528i-msport-f10-lci-malaysia-27

To meet growing demand in Thailand, BMW is spending nine million euros (RM38.6 million) to expand its plant and upgrade its logistics system in the Land of Smiles, Bangkok Post reports.

“The new investment will go mainly to expand production of passenger cars and motorcycles at Rayong’s Amata City Industrial Estate,” said Jeffrey Gaudiano, MD of BMW Manufacturing Thailand.

The Munich-based company plans to up production of passenger cars to 10,000 units in 2015 from 8,880 this year, with the motorcycle division set to churn out 1,000 units next year. Rayong is the only location in BMW’s global network with full operations for the group’s three brands – BMW, MINI and BMW Motorrad.

The Thai-assembled BMW F 800 R and F 800 GS are now in Malaysia, priced from RM63,800

Rayong rolls out the BMW 5-Series, 7-Series, X1 and X3 models. Next to join the Thai CKD list are the 3-Series, 3-Series Gran Turismo and the X5. Production of the Mini Countryman started last August.

On the motorcycle front, BMW assembles the F 800 R and F 800 GS models in Thailand. Both the 798 cc parallel-twin bikes are now available in Malaysia, at lower price tags of RM63,800 and RM73,900, respectively. There’s also a Low Seat Variant of the adventure bike (the GS), and that goes for RM76,900. BMW Motorrad shifted 400 units in Thailand last year, a 38% growth.

Looking to sell your car? Sell it with Carro.

Certified Pre-Owned - 1 Year Warranty

10% discount when you renew your car insurance

Compare prices between different insurer providers and use the promo code 'PAULTAN10' when you make your payment to save the most on your car insurance renewal compared to other competing services.

Car Insurance

Danny Tan

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

 

Comments

  • To those blind Proton fanbois who argue that closing blood-sucking P1 will lose jobs, Thailand doesn’t seem to have the problem of having a fair and progressive auto industry and attracting some of the world’s best. BMW here, Toyota, Honda etc.

    Well-loved. Like or Dislike: Thumb up 55 Thumb down 5
    • Same L0rrr on Aug 01, 2014 at 11:08 am

      Yes, the Proton fanboys are just only Sendiri Cakap, Sendiri Syok.

      Because of the bloody Proton, others cars are so expensive. Proton build quality sucks, Malaysian has no choice but to pay extra for foreign car, tax all goes to government and Proton, and all job opportunities go to Thailand.

      Like or Dislike: Thumb up 39 Thumb down 6
    • Nappy on Aug 01, 2014 at 12:22 pm

      Thanks to Dr M the father of Thailand automotive industry…bravo…!! ::clap!::clap!::clap!::

      Like or Dislike: Thumb up 27 Thumb down 5
    • cabaiperawit on Aug 02, 2014 at 2:58 am

      and those manufacturers can any time close shop and move to other countries who can offer better packages. or they can go back to country where it belong if their economy not strong.

      Like or Dislike: Thumb up 2 Thumb down 3
    • kzm (Member) on Aug 02, 2014 at 2:08 pm

      i tot u guy dont want ckd bmw? change of heart suddenly? better they go there can increase quality wat..

      Like or Dislike: Thumb up 1 Thumb down 2
  • sudonano (Member) on Aug 01, 2014 at 10:06 am

    I’m just curious, why do they have the 5er, X1, X3 and soon the 3er made in Thailand too, when our Inokom makes the same models. Instead, wouldn’t be better if they streamline the production since after all we have AFTA etc?

    As in, maybe produce the 5, 7 and X5 there in Thailand, and maybe the 3, X1 and X3 here in Malaysia. Or make Inokom the contract assembler for the xDrive SUV models (X1, X3, X5) and the Thai plant the contract assembler for the sedans.

    Thailand’s quality is somewhat better actually than the Inokom produced cars. Been in the Thai made 730Li and would say the fit and finish is closer to CBU standards actually compared to Inokom’s fit and finish (i.e. panel fit, seats quality) of the 520/28i.

    Like or Dislike: Thumb up 21 Thumb down 0
    • Inokom is a contract manufacturer. Just like Magna in Europe. They make cars for multiple manufacturers which means less control of production process.

      The Thai investment on the other hand is organic. The plan is probably to gradually reduce dependance on contract manufacturers in this region and do it themselves as demand is far outstripping supply i reckon.

      What is sad is that our politically and socially unstable neighbours (no offence in anyway) continue to get automotive investments in droves while we get left out although we are far ahead in areas such as infrastructure,political and social stability. Ancient policies solely designed to keep feeding the few elite is really hindering this country. If we continue to be overlooked, it really could get bad 20 years down to road. All of this has been extensively discussed, but it really is upsetting thinking about it.

      Like or Dislike: Thumb up 29 Thumb down 0
      • Same L0rrr on Aug 01, 2014 at 11:41 am

        BMW investing RM37.8 (90mil euros) to Thailand while Proton begging for RM1700mil.

        WHAT A CONTRAST!

        Like or Dislike: Thumb up 33 Thumb down 1
        • cabaiperawit on Aug 02, 2014 at 2:52 am

          actually, if you have a local registered company can produce your own car which involved development from A-Z, you could get the intensive too. the intensive is not meant for proton alone, other manufacturers are welcomed but it has to be full development by malaysian registered company…not for ‘tukang pasang’.

          Like or Dislike: Thumb up 2 Thumb down 3
      • sudonano (Member) on Aug 01, 2014 at 12:26 pm

        Ah I see, well that makes sense, I see even BMW is slowly moving away from Magna Steyr too with only BMW’s Mini Countryman and Paceman running off their lines- guess it’s due to costs and also Magna’s spotty quality (from the old X3 days)…

        Now that you put it this way, it sounds like a good idea too. Inokom’s assembly is not that sustainable, they mainly produce BMWs and Minis for our local market, not even for Singapore if I am not mistaken. Then there is the Inokom’s quality that is rather pathetic for BMW’s standards… having an Inokom BMW myself and reading the things on Carbase by the newer F30 and F10 owners, I see I am not alone with the Inokom quality issues.

        Tbh, I still think the Thais have better quality standards than the Malaysian counterparts. Somehow, probably it’s the part where the Thais just screw the plastics a little better than the Malaysians, or most likely the final QC done in Thailand is more stringent than the Malaysia Boleh QC done by Inokom. Same thing with Naza…

        By far in Malaysia, the best local assembly line has to be Mercedes Benz. By far and large, they really follow the Mercedes standards, no compromised. Inokom could learn a thing or two…

        Like or Dislike: Thumb up 12 Thumb down 2
    • kzm (Member) on Aug 02, 2014 at 2:27 pm

      malaysia production oni for malaysia consumption not for export…

      Like or Dislike: Thumb up 1 Thumb down 0
  • Operation-Manager (Member) on Aug 01, 2014 at 10:14 am

    Finally Msia lost against on the very last market -EU car makers. No needed to mention on Japanese & US car makers that already well setup at Thai and now crossing towards Indo, Vietnam, Myanmar, Filipino…

    Like or Dislike: Thumb up 18 Thumb down 0
  • longjaafar on Aug 01, 2014 at 10:16 am

    If the 7 series are rolling out from Thailand, what kind of duties do we pay if it is imported into Malaysia, under the ASEAN scheme of duties?

    Like or Dislike: Thumb up 5 Thumb down 0
    • shortjaafar on Aug 01, 2014 at 11:09 am

      barely any. bmw malaysia can easily offer cheaper prices but choose to earn gigantic margins instead.

      Like or Dislike: Thumb up 9 Thumb down 0
    • kzm (Member) on Aug 02, 2014 at 2:18 pm

      zero import tax….same excise duty n sales tax

      Like or Dislike: Thumb up 0 Thumb down 0
  • Operation-Manager (Member) on Aug 01, 2014 at 10:25 am

    Few factors on Foreign Auto Investment: (1)Local sales market share (2)Operation Cost
    No way a foreign investor to invest if their products could not capture bigger local market share, furthermore the Msia operation cost is the 2nd highest after Singapore among ASEAN.
    What is the point to invest here where ur product mainly for export but u could produce cheaper goods at export destination countries ???

    Like or Dislike: Thumb up 5 Thumb down 1
  • FedupMalaysian on Aug 01, 2014 at 10:38 am

    Hmmm…BMW could have establish a manufacturing facility in Malaysia, as we have better infra and better skillset, stable government, no floods etc than Thailand…but no thanks to Proton and Kroni, NAP etc, we are no longer as attractive compared to other countries. :-(

    Like or Dislike: Thumb up 24 Thumb down 0
  • lonelyobserve (Member) on Aug 01, 2014 at 10:51 am

    9M Euros is equivalent to RM37.8M, just Thailand’s plant. I would like to know how much BMW has invested to Boleh Land’s assembly plant.

    Like or Dislike: Thumb up 4 Thumb down 0
    • kzm (Member) on Aug 02, 2014 at 2:32 pm

      they expand existing plant not building new plant…same when they expand plant in kulim last year from 7k to 8k

      Like or Dislike: Thumb up 0 Thumb down 0
  • It’s not just the cheaper labor why car companies are flocking to Thailand. It’s because they have an extensive amount of local parts manufacturer ready for outsourcing too. If cheap labor is the only thing, car companies would be moving to Vietnam or Indonesia by now.
    Volkswagen has also just proposed a plan to join the Eco-Car phase 2 project. This will be their first ever factory in this region I think.

    Like or Dislike: Thumb up 1 Thumb down 0
    • Operation-Manager (Member) on Aug 01, 2014 at 4:26 pm

      As long as there is an OEM invested then there will be multiple subcon/vendor established with mixed both local & foreign company. Truely business minded businessman would captured those business opportunity if there is. What a worry!?

      Like or Dislike: Thumb up 1 Thumb down 0
    • Operation-Manager (Member) on Aug 01, 2014 at 4:43 pm

      Yes, there are moving into Indo & Vietnam, framaticalky growing local markets share with covered mainly A~B segment, the more job opportunities will generated economic growth then created more wealthy citizen. 10yrs after there will be bigger demand on C-D segment when economic transformed. Any reason why Thailand/Indonesia/Vietnam/Filipine/Myanmar needed to import vehicle from Malaysia where it could be manufactured with lower cost at their own country & their local market share is growing bigger with transparent & equal business opportunity.

      Like or Dislike: Thumb up 0 Thumb down 0
  • Simon Ng on Aug 01, 2014 at 2:51 pm

    The 9 million EUROS is only a tip of the ice berg. Think about the multiplier effect that it creates for the economy. Better income for the locals, better tax collection, better expenditure power etc.

    A company who has invested so much in a country, they have planned to stay there long term. There will be more investment going their way.

    In return, this will only improve the local workforce skill sets and thus attract even more investments into the country.

    Like or Dislike: Thumb up 7 Thumb down 0
    • Operation-Manager (Member) on Aug 01, 2014 at 5:01 pm

      In rude way:
      You M-govt ask me to invest but end up u tax me so high until I cannot sell well my car in ur country. I give u business opportunity but the return I gained was few smelly eggs.
      Where are the logic behind? U dunno your operation cost is highest among ASEAN after SIN. I don’t gain any benefit if I dumped my investment in msia.

      Msia govt think there are smart to tax & duty high high on imported car.
      Let’s say if all country applied same tax, if others country tax 300% cars imported from Msia while local 30%. How msia made car can sell outside than msia? ASEAN treat Msia too good nowaday. Thailand pls tax Mazda CX5 imported from msia 300% & make it unable to gain any market share in thai.

      Like or Dislike: Thumb up 5 Thumb down 0
      • kzm (Member) on Aug 02, 2014 at 2:44 pm

        300% tax?
        highest in boleh is 145% (30% import, 105% max excise, 10% sales)
        highest in thais 147% (80% import, 50% max excise, 7% gst, 10% interior tax)

        Like or Dislike: Thumb up 0 Thumb down 3
  • think long term, not short term. open up our car industry and we can create more jobs for our people. stop living the kampung attitude and globalise our industry.

    all talk no action!

    Like or Dislike: Thumb up 12 Thumb down 0
  • investor on Aug 04, 2014 at 12:42 pm

    in here we type, no talk or action is needed here.. walk away if you feel butthurt

    Like or Dislike: Thumb up 0 Thumb down 0
 

Add a comment

required

required