SHANGHAI--German luxury car maker BMW AG is sticking to its
plans to expand capacity in China and plans to produce three
additional models in the country, despite the marked slowdown in
the Chinese economy.
Munich-based BMW posted a 7.6% increase in sales in China in the
first three months of the year and is in the process of expanding
production capacity to around 400,000 cars a year by the end of
2016 from 300,000 now.
"Last year we sold 456,000 cars in China with capacity of
300,000 and now we are moving to capacity of 400,000," Ian
Robertson, BMW board member in charge of global sales, told
reporters at the Shanghai international auto show.
"At some point in the future, we'll look at it again."
BMW is currently making plans to produce three additional models
in China, but Mr. Robertson remained vague on the details. The new
models will include one of the company's X-Series sport-utility
vehicles, currently manufactured in Spartanburg, South Carolina.
The company will also add production of a multi-purpose vehicle and
third model that Mr. Robertson declined to identify.
He said BMW is also planning to open its first casting plant
outside Germany in China to manufacture a range of engines for its
3 and 5-Series cars.
Mr. Robertson said BMW has adjusted its production to changing
demand in China several times, largely by shifting production on
its assembly lines between models.
"We have a very flexible system," he said. "All our factories
run at more than 100%."
Max Warburton, an analyst with Bernstein Research, wrote in a
report published Monday that international auto makers were losing
more ground in China than widely believed. He also said there were
signs that local Chinese brands are staging a comeback in the
market.
BMW has warned about uncertainties in China, but Mr. Robertson
said international manufacturers still dominate the market and
premium brands still have room to grow.
"We still see growth, though at a lower level," he said.
"Premium demand is still growing."
Write to William Boston at william.boston@wsj.com
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