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BMW to raise output at Rosslyn plant
Unexpected strong demand for its new X3 sport utility vehicle has persuaded German car maker BMW to pump R160m into its South African vehicle assembly plant to grow production capacity by nearly 8%.
Photo by Markus Spiske on Unsplash
BMW SA's Rosslyn plant, near Pretoria, is due to begin production of the X3.
Annual capacity had been pegged at 71,000 but MD Tim Abbott said the additional cash would raise this to 76,000.
Rosslyn is approaching the end of a R6bn project to turn it into an X3 manufacturing site. The testing of 300 latest-generation assembly line robots has already begun.
Production of the 3-Series sedan, which has been built at Rosslyn for more than 40 years, will end early in 2018.
The plant will then suspend operations for several weeks while it changes over to the X3.
It will probably take several months after that for production to ramp up to full capacity.
Rosslyn built 63,000 BMW 3-Series cars in 2016.
The new X3 was launched in September at the Frankfurt Motor Show and is already being built in the US.
"That means any production glitches should be ironed out by the time we start," said Abbott.
Mainly for export
Rosslyn production will be mainly for export. The early emphasis will be on Europe, particularly Germany and the UK, but the long-term plan is to make inroads into markets across sub-Saharan Africa, where BMW sales are minimal.
Abbott said international sales of the X3 and other models in BMW's X range had exceeded expectations.
X vehicles already accounted for 30% of all BMW brand sales and were expected to keep rising. The X3 was responsible for 25% of all X sales.
The extended 76,000 production limit was as high as Rosslyn could go without significant new investment, Abbott said. Any more and Rosslyn would need a new body shop and other facilities, while suppliers would have to invest in more capacity and tooling.
"We would be talking billions more in spending, not millions," Abbott said. "That is not in our plans at this stage."
Source: Business Day
Source: I-Net Bridge
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