BMW will add production of the X3 to its factory at Rosslyn, South Africa, reports Bloomberg, in an effort to support output from the US plant in Spartanburg, South Carolina. The Rosslyn production of X3 will replace current output of the 3-Series, and X3 production will continue at Spartanburg, currently the only full assembly plant for the X3, and expected to add the X7 in 2016. Additionally, the report quotes BMW South Africa managing director Tim Abbott as saying, “We see the X3 as being, long term, a high-demand vehicle in countries like Nigeria or Kenya or Tanzania.” The company did not yet announce expected production volumes from Rosslyn. The BMW investment is being split between its own plant (ZAR3 million) and on suppliers, startup costs and training, the report notes. The change will be made when the current 3-Series reaches the end of its lifecycle, which IHS data suggests will be in 2018.
Significance: The South African plant was BMW’s first foreign plant, and opened in 1973, so production in the region is not new for the company. BMW built nearly 69,000 3-Series cars in Rosslyn in 2014, forecast to get slightly ahead of the 70,000-unit mark in 2015. BMW has several CBU and CKD plants building the 3-Series and the X3, with a total of 417,841 examples of the 3-Series and 139,847 of the X3 built in 2014. X3 production did dip from 2013’s 160,000 units; while the current plant arrangement was expected to see X3 production increase to 148,000 units by 2016, strong demand for SUVs globally suggests BMW could benefit from greater X3 production. BMW’s sales of the X3 in the Middle East/Africa region is a fraction of global X3 sales, at only 4,885 units in 2014. This could increase with more capacity, but the units built in Rosslyn are more likely to see greater sales outside the region than inside. BMW sales of the 3-Series in the region reached only 15,062 units in 2014, with most of the Rosslyn 3-Series production also exported.
