Brilliance joint venture to be extended through 2028, company official says

The BMW Group on Wednesday said that it will double the range of locally produced models to six and manufacture engines in China, as part of its developing plans to increase local production capacity.

The German-based car producer delivered 225,035 BMW and Mini cars to the Chinese market in the first half of 2014, up 23 percent and a new record.

Friedrich Eichiner, a BMW board member, said local production will enable BMW to cater to the rising demand among Chinese customers.

Eichiner also officially confirmed the extension of the joint venture with Brilliance China Automotive Holdings Ltd in China through 2028.

The BMW 5 series sedan's long-wheelbase version, the BMW 3 series sedan in both standard and long wheel base versions and the BMW X1 are now produced at the two plants of BMW Brilliance Automotive Ltd, a joint venture partnership established by BMW Group and Brilliance Auto in China in 2003.

"By extending our partnership with Brilliance Auto, we have created a foundation that will allow us to further intensify our engagement in China," said Eichiner.

Manufacturing capacity at the Dadong and Tiexi plants in Shenyang, the capital of Liaoning province, will be raised over the next two years to a combined annual total of 400,000 vehicles, against 300,000 at present.

When construction of the joint venture's new engine plant is completed in 2016, the BMW 3- and 4-cylinder gasoline engines will be produced. This plant, located near the Tiexi facility, will be the first BMW engine plant with a foundry workshop outside Germany.

The BMW Group has set up research and development facilities in Beijing, Shanghai and recently in Shenyang, to facilitate innovation with a better understanding of the China market. Eichiner said investment in local R&D will continue.

The R&D center at BMW Brilliance is focusing on development of a range of locally produced alternative-fuel vehicles. Karsten Engel, president and chief executive officer of BMW China, said the group hopes for synergy between the Chinese and German R&D functions that will benefit the company in China and around the world.

The company believes that China has the potential to become the world's largest market for new-energy vehicles.

As early as 2009, the group began running experimental electric vehicles in China, aiming to provide practical solutions. Currently, these solutions include the BMW i models, alternative-fuel BMW models as well as the line of Zinoro fully electric vehicles.

Sun Fuquan, a researcher at the Chinese Academy of Science and Technology for Development in Beijing, said new-energy vehicles are one of China's seven emerging strategic industries. The country is expected to have production capacity of 2 million and cumulative sales of more than 5 million by 2020.

"As China is experiencing an industrial upgrading boom, green-energy products and related investment obviously add to prosperity and benefit the economy and the environment in the long term," said Sun.

Contact the writers at zhongnan@chinadaily.com.cn and lifangfang@chinadaily.com.cn