Magna Steyr Austria Plant Adds BMW, JLR Production

VIENNA – Magna Steyr will launch production of new models for BMW and Jaguar Land Rover at its plant in Graz, Austria, in 2017.

The contract assembler’s current portfolio includes the Mercedes-Benz G-Class, Mini Countryman and Paceman and Peugeot RCZ. But only one of the four models, the G-Class, will survive after 2016.

The G-Class, which marked a new volume record last year, is Magna Steyr’s oldest model, production in Graz having begun in 1979. The company launched an extensively modernized and expanded G-Class manufacturing facility in 2013. In 2014, the contract with Daimler to produce the G-Class was extended until 2022.

Output of the Peugeot RCZ sports car, Magna Steyr’s lowest-volume model with 6,659 units built last year, will be phased out this fall. According to Sebastian Haböck, CEO of local distributor Peugeot Austria, the last RCZ vehicles will be manufactured in September or October at the latest. There is no follow-up order from PSA.

Currently the Mini Countryman accounts for the largest volumes in Graz. Production of both the Countryman and Paceman will end in fall 2016. In 2012, BMW decided to use the former NedCar plant in Born, Netherlands, for the contact production of new Mini models instead of Magna Steyr.

In January 2014, Magna Steyr said it had signed a contract to build new BMW Group models without providing more details. According to the German Automobil Produktion magazine, BMW plans to outsource a portion of the next-generation BMW 5-Series volume to Graz.

Plans call for the production of 50,000 to 70,000 5-Series vehicles in Austria per year, the magazine reports, quoting unnamed sources at BMW.

JLR is a new partner for Magna Steyr. Both companies announced their contract earlier this month without naming which models would be manufactured. Production launches in 2017.

The contract assembler, which currently employs 5,732 people, will add at least 2,000 jobs because of the new contracts, Hansjörg Tutner, executive director-human resources, tells local media in Graz.

Magna Steyr already plans to hire 150 new workers this fall for G-Class production.

Authorities in the Austrian state of Styria, where Graz is located, Magna Steyr and other companies announce the creation of a foundation which will help train some 1,500 new employees, including 1,000 for Magna Steyr. The investment for the project is €9.2 million ($10 million), with €5.5 million ($6 million) coming from public sources and the remainder from the private sector.

The foundation also will provide training for Magna Steyr workers in the time between the phaseout of Mini production and the start of new projects.

Magna Steyr manufactured 135,126 vehicles last year. The total includes 102,499 Mini Countryman and 10,902 Mini Paceman models, 14,993 units of the Mercedes-Benz G-Class, 73 Mercedes-Benz G-Class AMG 6x6s and 6,659 Peugeot RCZ models.