COLUMBIA, S.C., March 9, 2008
BMW To Build More Cars In U.S.
With Dollar Low, German Automaker Will Increase Production In America While Cutting Jobs At Home
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Associates at the BMW plant in Greer, S.C., assemble the X5 in this January 2007 photo. (AP/A. Hicks, Spart. Herald Journal)
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"This is completely driven by the plunge in the dollar," said Greg Gardner with Oliver Wyman, publisher of the Harbour Report on automotive manufacturing activity. "It is untenable to produce at a much higher cost in Germany."
The euro climbed to record heights Friday, reaching $1.5463 before falling back to $1.5335 in late trading after the Federal Reserve announced it would provide more cash to banks that need it. That means European goods cost more for Americans to buy.
By building the cars in the U.S., BMW can save money on the lower dollar and on wages since its South Carolina workers make less than German workers, Gardner said.
The declining dollar also means BMW and other foreign automakers likely will start buying locally for more of the parts used by their U.S. plants, he said.
That shift in production has led to the cuts at home for the Munich-based luxury car maker.
BMW's head of personnel, Ernst Baumann, said last month that 5,600 jobs would be cut by the end of the year. That's on top of 2,500 positions already eliminated. That adds up to 7.5 percent of the company's total work force of almost 108,000, including both permanent and temporary employees.
In the U.S., BMW Manufacturing Co. in Greer expects to increase production to 240,000 cars by 2012, company spokesman Bobby Hitt said last month. That's up from 155,000 last year.
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"Conceivably, as the volume increases and the manufacturing system at the Spartanburg (S.C.) plant improves, costs may come down enough to cut prices of their cars," Gardner said.This is completely driven by the plunge in the dollar. It is untenable to produce at a much higher cost in Germany.
Oliver WymanThe company has not said what impact the increase in production will have on employment in Greer, which is about 4,500 permanent employees and up to 900 temporary employees.
The company has scheduled an announcement for Monday at the BMW Zentrum in Greer, S.C., to discuss an addition to the plant, which makes the X5 and Z4 models. A spokeswoman at the Greer plant did not return phone messages seeking comment.
While luxury car sales are expected to be flat or a little down from last year, "BMW will still show growth," said Jack Nerad, executive market analyst for Irvine, Calif.-based Kelley Blue Book.
The company said BMW Group, which includes the Mini and Rolls-Royce brands, sold 198,628 cars worldwide in January and February, up from 191,357 for the same period last year. Sales of the BMW brand for February rose to 89,983 up from 85,310 for the month last year.
Nerad and the company say launches of new 1-Series models and the X6 also are expected to lift sales in 2008.
© MMVIII The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.
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See all 40 CommentsCanada, India and Russia to follow.
Everything that could go wrong -
Has gone wrong!
OOPS!
Posted by Inventagod at 09:16
I own a 1994 Japanese made Acura; 185000 miles and only about $3000 in repairs total. Hmmmmm!
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Well I own a 100% American made 2000 Pontiac Bonneville. 120K miles, and all I have had to do since I took ownership in ''03 is balance the wheels, change the oil and replace some light bulbs that burned out from old age.
Why? we can''''t afford them.
Posted by CHANGENOW at 09:06 PM : Mar 09, 2008
Don''t include ''me'' in your self-serving ''we''.
maybe you should get out more and check the prices of some of the GM product line - ''Burbs and Tahoe. They''re pushing $60k.
Everything that could go wrong -
Has gone wrong!
OOPS!
Posted by Inventagod at 09:16
I own a 1994 Japanese made Acura; 185000 miles and only about $3000 in repairs total. Hmmmmm!
The company, to establish financing for the deals, entered into repurchase agreements with banks in which it would post the mortgage securities as collateral in exchange for cash.
If the value of the security held as collateral falls, the lender has the right to ask for more collateral -- a "margin call" -- to secure the loan.
If the borrower does not meet the margin call by putting up more collateral, the lender may sell the security.
so all the banks used the inflated houseing prices to get large sums of cash, our mortages that they lied in the first place saying a home is valued at 400000 or 500000 and it was really worth 200000, then go to investers and say look we have so much equity that if they go bad we still make billions..OOPS THE VALUES HAVE COME DOWN TO WHAT THE HOMES ARE REALLY WORTH, OOPS, WHAT DO WE DO?????? LETS JUST RIGHT IT OFF...NO MATTER THE GOVERNEMNT WONT LET US GO DOWN..
GREAT JOB..CONGRESS HOW ABOUT SAVEING US AMERICANS INSTEAD OF THE ONES THAT LIED AND CHEATED US...
Everything that could go wrong -
Has gone wrong!
OOPS!
Why don''t you tell us once more how water can be used in place of gasoline if you change its molecular structure by giving it an electrical charge?
BMW could use this "superwater" as fuel in their cars, couldn''t they?
You weren''t fired by your Jewish former employer because you''re a Goy pig.
You were fired because you have pschitt for brains!
"Neocon" is used by critics as a code word for a lot of things, among them: imperialist, unrealistic dreamer, and scheming puppeteer (along with its subset, scheming evil Jewish puppeteer).
Boy I ought to know better. I sure do know why I don''t like titles. Everybody has a different definition for the same thing. Guess I''ll have to settle for being an American citizen! And be thankful for that.
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Posted by cfin5
Yep!I guess, got to look and see what they mean.
Why? we can''t afford them.
And now a joke:
What''s the difference between a BMW and a porcupine?
The porcupine has it''s pri*cks on the outside. LOL
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Posted by mocaIeo
You know I guess I could be one of them there liberals! After 17 years and 6 families I decided I could live on my own. Went to Cambodia for a trip. Came home in 1969, to be spit on and labeled a child killer. (kinda rebelled) Went on to raise 2 daughters, and 1 son. Don''t now, nor did then get any assistance from government (not even unemployment). Opps did get to live free, and do appreciate that. Now at close to retiring I do see the light. I only ask for the monies back from SS that I have paid in for the last 44 years. Never thought government was my parent. Because of bogus military rules don''t get any VA either. In other words don''t think your right about lumping everyone into one group!
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