BMW plans to lift exports to China from its Rayong assembly plant in Thailand this year, as part of a broader strategy of harnessing its global manufacturing network to meet strong demand in China, according to local reports.
China increased import duties on US vehicle imports to 40% last July in retaliation to an equivalent tariff increase by the USA. While the US government is optimistic that an agreement can be reached during the current round of trade negotiations, the German luxury carmaker is looking to maximize the benefits of its global network which includes 30 production and assembly facilities in 14 countries.
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Capacity utilisation at its Spartanburg plant in the USA, which supplies SUVs to China, is already very tight and new SUV models will go on sale this year including the new X7.
BMW is currently enjoying the benefits of the free-trade agreement (FTA) between Thailand and China. Through its local subsidiary BMW Group Thailand, it exported around 4,300 cars to China last year – around 28% of its total output of 15,300 units in the country. Local shipments amounted to just over 12,000 units.
BMW's Rayong plant has a capacity to assemble 20,000 cars annually and a spokesperson for the company said it plans to increase output to increase exports to China and possibly to other markets in the region. The plant's growing role as a production hub is expected to lead to further capacity expansion in the near future.
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