BMW has announced that it will be increasing its stake in its joint-venture in China with Brilliance Automotive in a deal that will see it taking over control of BMW Brilliance Automotive (BBA). The deal, which is set to be completed in 2022 when China lifts the rules on foreign ownership limits, will see BMW upping its share in the JV from 50% to 75%.
The extended JV contract is valid for 22 years, from 2018 to 2040. As part of the deal, the German automaker is set to invest more than three billion euros to build and upgrade existing plant operations in Shenyang over the coming years.
Last year, BBA’s factories in Tiexi and Dadong produced almost 400,000 vehicles. In Tiexi, a new plant on the existing plant ground will double the site’s capacity, while extensive remodelling and expansion measures will target the neighbouring plant in Dadong. Total production capacity for the plants are slated to gradually increase to 650,000 units from the early 2020s, creating 5,000 new jobs in the process.
Presently, six BMW models are produced at the Shenyang factories – Tiexi builds the 1 Series Sedan, the 2 Series Active Tourer, the 3 Series sedan and the X1, while Dadong assembles the long-wheelbase 5 Series as well as the X3, and from 2020, the fully-electric iX3. Dadong will be the iX3’s sole production location, with the car being exported to global markets.
The move by BMW to increase its scope in China is no surprise – the country is the brand’s biggest single market globally. Last year, it sold around 560,000 BMW brand vehicles there, more than Germany and the US together, with two-thirds of these being those produced by BBA in Tiexi and Dadong.
In addition to its two existing vehicle plants, BBA also opened its own battery factory in Tiexi a year ago, and expansion is now on the cards – an upcoming line will eventually produce new, more powerful batteries with fifth-generation electric technology for the iX3.
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BMW and Audi need to take control in Msia.
Yes .. You never ever bastardise your brand to China. BMW is smart to buy China out. DRB should have just closed Proton instead of letting Geely take advantage of Malaysia . Now they enjoy preferential national car tax by just changing the LOGO. Many brands who invested heavily in Malaysia will not be please with Malaysia Automotive policy towards Geely . The Chinese in China are laughing at Malaysians for being a failure and short sighted … while they dump their products here … Donald Trump is right.
Geely didnt invest in Proton, they used Proton to sell their own products. They are not practicing what they did with Volvo. Geely cheated Malaysians and the Govt and are insincere in helping the local automotive industry – only taking advantage of tax
Yup every new Volvo is built ground up..100%new … whilst every new “Proton” is an existing Geely model. This Geely really got us good and proper … and like idiots many still thanking them. DRB should have closed Proton
You are very right on this my friend. To fix this the market must be liberated so it’s free for all to compete. Tax Proton and Perodua if you are going to tax the rest.
You mean Audi needs to take control in Malaysia. Currently they are doing nothing except for selling pre reg old models. Where is the long awaited Q5? How about the new A8 and don’t get me started on the A5, 6 and 7 too.