S.C. plant ranks No. 2 in BMW world operations

 The new BMW X3 began production in the company's South Carolina plant in Spartanburg County on Sept. 1, 2010. (Photo/BMW USA)

The new BMW X3 began production in the company's South Carolina plant in Spartanburg County on Sept. 1, 2010. (Photo/BMW USA)

By Chuck Crumbo
ccrumbo@scbiznews.com
Published Dec. 5, 2012

GREER, S.C. — BMW’s second-largest production plant is not in Germany. The largest exporter of cars built in the United States happens to be headquartered in Germany.

Confused?

Well, don’t be.

It just happens that BMW’s manufacturing facility in the Upstate now ranks as the Munich-based carmaker’s No. 2 production plant in the world.

The plant ships 70% of its production through the Port of Charleston to 130 world markets.

Josef Kerscher, president BMW Manufacturing
Josef Kerscher, president BMW Manufacturing

The National Association of Foreign Trade Zones has recognized BMW has its Exporter of the Year. In addition, NAFTZ has recognized BMW as the recipient of its Export Achievement Award for being the member that showed the most improvement in value. In 2011, BMW exports were valued at more than $7 billion.

The sprawling, 4 million-square-foot plant off Interstate 85 near Greer in Spartanburg County is on target to produce 300,000 vehicles this year or about 1,000 a day, said Josef Kerscher, president of BMW Manufacturing. Last year the plant produced 276,056 cars.

“Our plant is the second-largest manufacturing facility,” said Kerscher, who recently lectured on the BMW experience in the Palmetto State at the University of South Carolina’s Darla Moore School of Business.

“It’s not what we expected,” Kerscher said, noting that when the plant started production in 1994 it was regarded as a “small unit” in the worldwide BMW operation.

Since then BMW has produced more than 2 million cars in South Carolina, each bearing the company’s iconic blue-and-white roundel or logo. The colors represent the state flag of Bavaria, home of the company formally known as Bayerische Motoren Werke AG.

It also has developed a network of 170 suppliers in North America — 40 of them in South Carolina.

BMW, though, is not slowing down in the Southeast. Kerscher noted that the company is in the midst of a $900 million expansion that will increase the plant’s annual production capacity to 350,000 units.

When the project is completed, BMW expects to increase the Upstate plant’s payroll by 300 workers. It presently employs 7,000 people. The expansion also will boost the carmaker’s investment in South Carolina to nearly $6 billion since it first announced plans to build the plant back in 1992.

The expansion will allow BMW to add a fourth model, the X4, to its line of sports activity vehicles produced at the Upstate plant, Kerscher said.

Kerscher declined to offer many details about the new model to be introduced for the 2014 model year, saying he had to view pictures of the car in a “dark room in Munich.”

According to trade publications, the X4 essentially will be a sportier version of the X3, featuring coupe styling instead of a boxy SUV design.

All of BMW’s sports activity vehicles — classified as SUVs or light trucks — are built in South Carolina. The key to BMW’s success has been exports, Kerscher said.

“We’ve always been focused on exporting because Germany is not a big market,” Kerscher said. “So we’ve always had to learn how to be competitive in the world market.”

Germany and China are the top two destinations for S.C.-made products, Kerscher said, adding that BMW has the flexibility to respond to demand anywhere on the globe. Although the European economy is struggling, Kerscher said BMW is holding its own in the premium car market.

“The Asian market is growing. The U.S. market is growing,” Kerscher said. “So overall we are growing, and we believe we can overcome the situation.”

Being in South Carolina has kept BMW competitive, Kerscher said. He praised the cooperation and help of state and local governments, and labeled the Upstate as a “business-friendly community.” He also lauded the quality and work ethic of the company’s employees.

“This is a business environment that we really like and helps us to be competitive in the U.S. marketplace, to be competitive in the world market,” Kerscher said. “If you’re not competitive in our business, you will be out of business very soon.”

Reach Chuck Crumbo at 803-401-1094, extension 204.

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