BMW is to build a new manufacturing facility in Hungary, close to the town of Debrecen.
It says the plant will come at an investment of approximately EUR1bn, offer capacity of up to 150,000 units a year and create over 1,000 new jobs. The plant will be equipped with a single production line to manufacture electrified models as well as cars fitted with conventional combustion engines.
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Electrified cars are relatively costly to develop and manufacture, so adding e-mobility capacity with a flexible plant in a low-cost part of Europe (and inside the EU) that can build them could make good long-term strategic sense for the company.
“The BMW Group’s decision to build this new plant reaffirms our perspective for global growth. After significant investments in China, Mexico and the USA, we are now strengthening our activities in Europe to maintain a worldwide balance of production between Asia, America and our home continent,” said Harald Krüger, Chairman of the BMW AG Board of Management. “Europe is the BMW Group’s largest production location. In 2018 alone we are investing more than €1 billion in our German sites to upgrade and prepare them for electric mobility.”
Oliver Zipse, BMW AG Board Member for Production, added: “In the future, every BMW Group plant in Europe will be equipped to produce electrified as well as conventional vehicles. Our new plant in Hungary will also be able to manufacture both combustion and electrified BMW models – all on a single production line. It will bring greater capacity to our worldwide production network. When production commences, the plant will set new standards in flexibility, digitalisation and productivity.”
Europe is the most important market for the BMW Group. In 2017 it accounted for almost 45% of all vehicle sales, with 1.1m units sold.
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By GlobalDataThe case for Debrecen
BMW says Debrecen is the ideal place for the BMW Group to expand its European production network. It was chosen ‘primarily for its very good infrastructure, suitable logistics connections and proximity to the established supplier network’. The qualified personnel in the local area were another key advantage, it says. Besides the team at the plant itself, numerous jobs will be created with suppliers and service providers, both within the grounds of the new facility and across the local region.
Last year BMW said that materials and services worth EUR1.4bn were purchased in Hungary.
