Wheels24

BMW to invest 2.2bn in SA

2012-02-20 20:59

Pretoria - BMW has invested R2.2bn in the South African economy to enable production here of a new vehicle series.

The announcement was made by National Economic Development Minister Ebrahim Patel on Monday at a function in Pretoria to mark the start of production at Rosslyn of a contract to assemble the sixth generation of the BMW 3 Series that was agreed some time ago and will run for seven years until 2018.

"[This] is a private-sector vote of confidence in our economy," Patel said in a speech prepared for delivery at Rosslyn in Pretoria, HQ of BMW in South Africa. It is also a huge vote of confidence from BMW worldwide in the ability of BMW SA to produce the quality of vehicles required.

85% EXPORTS


The production contact will eventually generate 600 jobs and is a major triumph for BMW South Africa against competition from around the world. The automaker’s home plants in Munich will produce the bulk of 3 Series production, followed by South Africa with an initial build of 50 000 cars a year rising to 90 000 annually.

The production run will involve a third shift at the Rosslyn plant.

The cars will also be assembled in Shanghai, China.

BMW SA exports about 85% of the cars it assembles. The plant's current capacity stood at 55 000 units a year but Patel said this was likely to exceed 90 000 a year with the new investment and build contract.

This will be the third 3 Series range to be assembled in South Africa since the first major agreement back in 1999 which in itself followed an investment in BMW SA of R1bn in 1996 to prepare for the original challenge. The South African-built cars will be supplied to all right-hand drive markets as well as to the US.

IMPORTANT MARKETS

Frank-Peter Arndt, member of the BMW AG management board responsible for production, said at the function: “The BMW 3 Series is the most important volume-produced model of the BMW Group as well as the biggest-selling model in the entire premium segment.

“At the same time, every generation of the 3 Series sedan has been built in Rosslyn and since 1999 this plant has been responsible for production for important export markets such as the USA, Canada, Japan, Singapore and Australasia to name but a few.

“In 2009 – when the economic crisis reached its peak – we decided to invest R2.2bn to increase production capacity here in South Africa to produce the new 3 Series Sedan.

“This was the clearest statement we could make at the time.”

Speaking at the event to commemorate the official start of production Arndt, also chairperson of BMW SA, explained that while the investment safeguarded around 2 500 jobs in the middle of the recession it would ultimately lead to significant increases in production, export and employment in years to come.

“In 1973, Rosslyn became the first BMW production facility to be established outside of Germany,” he reminded, “so it is fitting that, almost 40 years later, production of this new model signals the beginning of a new era of innovation, passion and commitment for the BMW Group in South Africa.

“Even though the global economic outlook remains uncertain, we remain true to our commitment to this production location. By the end of 2012 we plan to introduce a third shift. This will significantly increase the installed production capacity above 90 000 units. It will more than double BMW 3 Series exports from South Africa and will create 600 jobs at Rosslyn. This is again a strong signal – for our staff, our suppliers and South Africa as an industrial location.”

The South African motor industry development programme will soon be replaced by an automotive production and development programme. The latter will focus on production incentives that calculate benefits on the basis of actual local production value (local content), and not on material cost, as was the practice under the previous one.

Comments
  • miyo27 - 2012-02-20 21:11

    BMWs are ego supplements to small little men

      Bob - 2012-02-21 00:21

      Twat!

      Rory-Taylor - 2012-02-21 14:37

      no such thing as "small little"...

  • Mzwandile - 2012-02-20 21:21

    BMW has shown confidence to the economy of SA. While are trying so hard to puddle lies about this country many who are not misled easily continue to invest in this country. Bravo BMW.

      Spyker - 2012-02-20 22:58

      R2.2bn is small change for BMW - do not fool yourself.., fool... BMW 'invested' THREE TIMES this amount in a single plant in the USA. What fools like you cannot comprehend is that there was a time when SA was one of Germany's key overseas manufacturers - they spent the bulk of their investment here. Since '94 SA rapidly dropped down the scale and now only gets investments of a magnitude that is regarded as low-risk. Do you think for one moment that they would invest in a country on its way back to the stone-age; via the ANC's dogged pursuit of a parasite economy, like that of the Chinese. Creating a completely out-of-date Marxist state based on ideologies that failed decades ago already. All of this while the country is getting progressively more uneducated every day - more so while tertiary education has exclusively become a matter of quotas and SA produces more-and-more illiterate graduates to just meet AA quotas. Dream on, my feckless foe...

      Mule - 2012-02-20 23:15

      @Spiker_May - This might be considered a small investment in the bigger scheme of things but it could have gone elsewhere like in Australia, Singapore etc...The fact that BMW chose SA means they have confidence in BMW SA's ability to deliver on this. 600 more people will have quality jobs as a result of this investment

      John - 2012-02-21 08:40

      @Spyker_May its obvious that you are the bigger fool, for you to suggest the biggest economy in the world, China in terms of money circulation is is a dud shows that you are the bigger dud. If you understood a bit about economics and the Keynsian model you would understand that China has actually followed some very strong economics fundamentals and hence they are flourishing the West on the other hand has not and for the next hundred years they will be paying debts back to China. This deal is about costs, as long as South Africa's costs remain low and efficiencies are kept companies will continue to invest in South Africa. Spyker_May you obviously have issues of your own, deal with them first before you start making derogatory statements...

      thitos - 2012-02-21 10:17

      Spyker_May didn't get hugs as a child.

      Spyker - 2012-02-21 10:34

      @John.., They say that people who know nothing are dangerous, but that people who know just a little bit, are the most dangerous. You do not have to worry.., you are okay, because you know nothing...

      miyo27 - 2012-02-22 05:15

      @spyker_may....even more reason BMW should be applauded. it shows that they are still interested in South Africa and still have confidence "in a country on its way back to the stone-age". You sound like the typical BMW driver. You get all emotional with facts and figures.....it's people like who I dread

  • Trevor - 2012-02-20 21:43

    That 2.2bn was sure as hell not spent on the plant...LOL...

      Sam - 2012-02-20 21:56

      Negative Trevor.... what can we say

      thitos - 2012-02-21 10:18

      You know so much Negative Trevor. Please enlighten us.

  • Hugo - 2012-02-20 21:58

    thank you Beeeemaaa

  • george.vanniekerk - 2012-02-20 22:16

    Brilliant!...more infrastructure, more jobs, more tax revenue (which i sincerely hope, will!.. be well spent, by the "government of the day?"...:)

  • Paul - 2012-02-20 22:28

    I always laugh at some comments from non-BMW drivers. Please drive one of these cars. Also see how people walk out of them alive after being taken out by the N1 hijackers. Once you can appreciate the engineering that is behind these little master pieces, come back again. The Germans have done something really great with this car, so stop denying it... accept it.

      miyo27 - 2012-02-20 23:22

      BMWs are incredible cars, don't get me wrong. It's the group of people who tend to drive BMWs. The people who think that by driving a BMW instantly increases their driving ability to that of a professional racer, who think their BMW has right of way over every other vehicle on the road. Now I'm not saying that all BMW drivers are pr!cks because most of them drive like the rest of the nation. It's the select few who think driving a BMW somehow makes them invincible...

      pvuuren - 2012-02-21 08:28

      @miyo27, Yes I agree the Cars are good, but for the driver to feel invincible in a BMW only means that the Marketing of the car is Better than the actual car, which i'm more inclined to believe...and then they go on to laud the Racing heritage of BMW, only to forget that the guys from Stuttgart, and i don't mean Porsche , have been racing and developing racing-tech passing it down to their other models for as long as BMW has existed, and if that argument doesn't go BMW's way they'll pull the "Jet-turbine Engine" -card and go on to argue that bmw thought it up and developed it, but still it was JUNKERS that made it work, to top it all they also believe that the blue and white in the logo is " A white propeller over a blue sky " in actual fact, its the colors of Bavaria... tsk tsk tsk BMW-People...

      miyo27 - 2012-02-22 05:16

      w@nker

  • Frank - 2012-02-21 11:45

    here comes the mini 5 series.will rather still go with a jag.

  • Colin - 2012-02-22 08:08

    investing 2.2bn for 600 jobs and exporting 50,000+ cars and still the price of the bmws made here and sold elsewhere will be cheaper than south africa. why can they reduce prices here so they are cheaper, maybe that way it will be of real benefit to rsa. 2.2bn in flow and many more billions out flow. all profit will go to bmw HO in germany...wont come here.

      Arno - 2012-02-22 13:25

      Yes definitely, the only places on earth where bmw's are more expensive than here is in japan and australia. It's cheaper to buy a bmw, that was locally built btw, in america/europe/india than it is to buy one here. Our car's are MASSIVELY overpriced because of absolutely ridiculous taxes imposed on buying new. Where is all the money from the carbon taxes going? All those fuel levy's, the RAF pays the least amount possible for a claim, the bloody list just goes on and on, and what options do we have? NONE!!!

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