Mini investing $387M in manufacturing, looking for even more capacity

MINI ANNOUNCES FURTHER ?250M INVESTMENT IN UK MANUFACTURING

09.07.2012

Oxford, UK: BMW Group has today announced a further ?250m investment in its UK manufacturing operations by the end of 2015 at its manufacturing plant in Oxford, steel body pressings operation at Swindon and engine plant at Hams Hall near Birmingham. This is to support the company's international growth strategy for the MINI brand with increasing volumes and up to 10 different models in the new line-up in the mid-term. It comes on top of the ?500m UK investment announced in June 2011 and means additional job security for the 5500 UK associates working in the so-called MINI UK Triangle plants.

The announcement was made during a visit to MINI Plant Oxford by Business Secretary, Vince Cable and Harald Krueger, Member of the Board of Management BMW Group.

"A year ago we announced a further investment of ?500m in our UK production network by 2014 and today we are announcing an additional ?250m, taking us through to 2015. This brings the total to ?1.75 billion since 2000," said Krueger. "Over the last eleven years, MINI has been a unique global success and the BMW Group has even greater plans for the future development of the brand. Plant Oxford has played a major role in this with cars being exported to over 100 countries around the world. This additional investment is great news for all our employees in the UK and shows the BMW Group's commitment to Britain as a vital manufacturing base for us."

Dr Vince Cable addressed company employees at Oxford, warmly welcoming the new investment, "BMW's ambitious plans for MINI will ensure its UK sites at Oxford, Swindon and Hams Hall remain at the centre of MINI production worldwide. The investment of ?250 million in addition to the ?500 million last year demonstrates BMW's commitment to the UK and safeguards jobs for the future."

The extra volume for the growth strategy of the MINI brand and the complexity of new model lines means that additional production capacity for MINI sales beyond Oxford's maximum capacity is needed in the medium term and the company is now considering how to achieve this.

"Our preferred option is to establish a contract manufacturer as a satellite production as close to our UK operations as possible, at the Nedcar plant in The Netherlands, with whom BMW is in discussions." explained Krueger. "Oxford will provide special MINI production expertise for any new operation, particularly in the areas of dealing with the high complexity and customer individuality which MINI demands and in operating state-of-the-art, multi-model production lines. Just as Munich is the centre of the BMW world, Oxford is and will remain the home and the heart of MINI."

As the volume and variety of the MINI model line-up grows, there will be additional production requirements for engines and body panels from the BMW Group's specialist UK facilities in Hams Hall and Swindon. Part of the new investment is to develop specific production facilities to meet these requirements.

BMW Group's contribution to UK economy

A report published by Oxford Economics makes clear the significance of BMW Group's business operations to the UK economy. The key findings of the study show:

the activities of BMW Group contribute ?1.2 billion each year to UK GDP
for every additional ?1 contribution to UK GDP directly generated by the company and its dealer network, ?2.20 in GDP is created across the UK economy
BMW Group and its dealer network employ 18,000 people directly while supporting over 46,000 UK jobs in total
80 per cent of MINIs and 90 per cent of Rolls-Royce Motor Cars are exported. In total, ?2.4 billion worth of cars and engines are exported each year, accounting for around one per cent of all goods exported by UK companies
BMW Group and its dealer network spend nearly ?1.2 billion each year sourcing goods and services from UK-based suppliers through the payment of employee income tax, national insurance contributions, business rates and VAT on vehicle sales, the activities of BMW Group and its dealer network directly contribute over ?900 million per annum to the UK Exchequer

Source: http://www.autoblog.com/2012/07/09/mini-investing-387m-in-manufacturing-looking-for-even-more-cap/

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