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BMW : New Plant in Leipzig, Germany

New BMW Group plant to be built in the region Leipzig/Halle

The BMW Group took the decision to build the new BMW plant in the region Leipzig/Halle. The location is within sight of the Leipzig Trade Fair. The area is about 200 hectares in size and has first-class connections to the motorway, the airport and the railway system.

Approximately 10,000 new jobs will be created at the new location in the medium term - about 5,500 thereof at the new plant of the BMW Group and approximately the same number again in the surrounding area. Production will start in the year 2005. Following a ramp-up phase, a capacity of 650 units a day will be reached. It is planned to build the BMW 3 Series at the new plant, which will involve an investment of roughly Euro 1 billion.

The new plant is needed because the BMW Group has launched a market and product offensive. In this connection, plans include the BMW 1 series, the expansion of the BMW X-family and the BMW 6 series. The construction of a new factory is also essential because of the continued positive development in sales of BMW automobiles.

In all, more than 250 locations proposed in both Germany and abroad had to be examined. The last five locations given close consideration - Augsburg, Leipzig/Halle, Schwerin, Arras in France and Kolin in the Czech Republic - all fulfilled all the necessary criteria for building the new plant.

The most important criteria to be considered were as follows:

1. The economic viability and flexibility.
2. The features and the location of the future plant area.
3. The availability of qualified manpower.
4. The use of existing structures in terms of plants, suppliers and logistics.
5. The infrastructure for transport, supplies and waste management.
6. The connection to the sales and distribution network.
7. The process of implementation.

Considering the figures alone - above all the level of wages at the plant, foreign locations outside of Germany offered certain advantages.

Taking into account the need for flexibility - and here this means flexibility of job structures and the integration of the plant into the BMW Plant Network, process management extending from planning all the way to the start of full production, as well as designated grants, mere cost considerations had to be put into a different perspective.
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In the assessment in terms of the corporate interests, therefore, the decision was ultimately taken in favour of Leipzig/Halle This is the location with the best perspectives for the purposes of the BMW Group.

Integration into the plant network of the BMW Group

The integration of the new plant within the existing BMW Plant Network is very important. The essential point is to ensure that all the plants are able to operate at the same consistent and high level of capacity. This guarantees maximum efficiency and profitability, as it has been have proven time and again at the existing locations.

Another factor closely interacting with this consideration is the integration of the suppliers. In Leipzig/Halle it is possible to largely resort to the existing supplier structure throughout the south of Germany.

In all, this will allow a rapid ramp-up of production and optimum calculation of the entire ramp-up process to achieve a highly competitive productivity level.

'BMW's Formula for Work'

Looking at various entrepreneurial and business-related aspects, not only the cost of purchasing and developing the site had to be taken into consideration, but also the productivity and, accordingly, the cost of labour and working times. In this context the "BMW's Formula for Work" was applied in cooperating with the representatives of employees. So it was possible to significantly enhance the degree of flexibility.

The main point, once again, is to further optimise the job structures and work organisation. This also means disconnecting plant operation periods from personal working hours and vice versa In the final result the useful time-frame will be increased.

The "BMW's Formula for Work" was agreed on a competitive level of remuneration appropriate at the new location and based on the state-wide collective wage agreement. Clearly, the international human resources principles of the BMW Group also apply to the new location.

(18. July 2001)

Photos: BMW AG

BMW Kicks Off Series Production at the Leipzig Plant Today

Leipzig / Munich. The new BMW plant in Leipzig began operations today by launching its series production according to schedule. BMW will produce its 3 Series sedan in the new plant. The first vehicle was completed and turned over to BMW sales. It was a BMW 320i, manufactured by order of a customer from Leipzig. The BMW Group has built a completely new automotive plant in Leipzig with all of the essential production stages of car manufacturing - body shop, paint shop and assembly. Construction, including integration and test operations, took just under three years. The decision to build a new BMW plant in Leipzig was made on July 18, 2001. The overall investment volume is estimated at 1.3 billion euros.

On a medium-range basis, the BMW plant in Leipzig will have a production capacity of up to 650 vehicles per day. During the start-up phase 2,500 people will be working on the plant premises. Assuming full capacity utilization, over 5,000 jobs will be created there in the long term, most of them BMW jobs. Based on experience, it is expected that an approximately equal number of additional jobs will be created in the region surrounding the plant.

The official plant opening ceremony is scheduled for May 13, 2005. Plant tours for the public will be offered starting in July. These tours will last about two and a half hours and are expected to be available for booking beginning in late May via the plant's website www.bmw-werk-leipzig.de.

03/01/2005

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