Special Coverage

Management Briefing Seminars

TRAVERSE CITY, MI – BMW Mfg. Co. LLC’s plant in Spartanburg, SC, will have the most advanced paint shop in the world dedicated to producing BMW luxury vehicles.

The German auto maker announced plans 18 months ago to expand the South Carolina plant, which opened in 1994 and has assembled 1.5 million vehicles.

“One and a half years later, the building is finished,” BMW Manufacturing President Josef Kerscher says at the World Class Manufacturing session today at the Management Briefing Seminars hosted here by the Center for Automotive Research.

Equipment now is being installed in the new portion of the plant, which takes annual capacity from 150,000 units to 200,000.

Kerscher is particularly proud of the new paint shop, which is being installed around the original one. It will take two years to complete the installation, and the work is being done while the current shop runs at full capacity.

“In the months ahead, we will combine two into one very efficient paint shop,” Kerscher says. The integrated paint process eliminates the application of a primer coat, saving time and money and reducing energy use while achieving the same quality.

“We believe our new paint shop will be the most modern within the BMW group assembling BMW vehicles,” he says. A similar approach is used in Oxford, U.K., for BMW’s production of the Mini Cooper.

As other BMW vehicle assembly plants are updated globally, they will integrate the new technology.

Infrastructure improvements also are under way, and Kerscher says he is confident the refurbished South Carolina facility will stack up well against competitive plants in the U.S.

“In this case, I think you can see BMW believes in the future in the U.S.,” he says. “We are preparing ourselves worldwide for increasing demand in the future.”

Kerscher declines to say at what point the new capacity will be ready. The first vehicle scheduled for production is the X3 cross/utility vehicle, which is moving from Europe to Spartanburg. BMW has not said when the new X3 goes on sale.

The South Carolina plant employs 5,000 people and produces the X5 and X6 CUVs and now is launching M high-performance variants.

In 2008, the plant exported more than 70% of its products to other markets, Kerscher says, adding the facility is flexible enough to adapt quickly to changes in the market.

During a 6-week period last year, demand for the X6 tripled. “Within a short period, we could produce 300% more for the Chinese market,” he says.

The South Carolina facility follows a “build-to-order” philosophy allowing orders to be changed within five days before assembly starts. “And our task, which is very tough, is to deliver 95% of our cars on time,” Kerscher says, adding 80% of vehicles at the site were built to order in 2008.

BMW follows this method to keep low stocks with dealers and part suppliers. “But you must have a very flexible production system to react so fast,” he says.

Despite industry wide sales declines in 2008, Kerscher says BMW had its best year ever in the U.S., selling 170,000 vehicles.