BMW picks Thai plant as regional launching pad

BMW picks Thai plant as regional launching pad

BANGKOK (AP): Bayerische Motoren Werke AG, or BMW, will start
rolling sedans off the production lines at a new plant in
Thailand early next year, hoping to capitalize on a nascent
economic recovery, the company said Wednesday.

Jesus Cordoba, president of BMW (Thailand), told The
Associated Press in an interview that production targets of
10,000 vehicles per year should be reached by 2004 and will
initially be aimed at the Thai market.

"Afterward, we will study the possibilities of expanding our
market to cover all the countries around Thailand, the Southeast
Asian markets, and expand production to 20,000 to 30,000 units a
year," Cordoba said.

The 1.2 billion baht plant in the eastern auto production
center of Rayong, where Western automakers Ford and General
Motors also have facilities, is viewed by BMW as getting a bigger
foot in the Asian market. Until now, the firm has relied on a
local partner to assemble vehicles from kits.

The plant will create jobs for 500 Thai workers, Cordoba said,
and expatriate German staff will be coaching Thais to run the
factory in two years, though management will remain in German
hands.

Thailand has become the offshore Southeast Asian manufacturing
center for many of the world's big carmakers, particularly the
Japanese.

The domestic market shrunk when the Asian economic crisis
struck in 1997, but manufacturers are increasingly tooling Thai
plants to export vehicles to other parts of the region.

Sales in the Thai passenger car market are expected to grow 18
percent this year from 1998, the worst year of the crisis,
reaching 55,000 vehicles. BMW hopes to get 3 percent of that.
In the luxury performance segment, BMW's target is to get 30
percent, with total sales expected to reach 6,200 from 4,983 last
year.

In the first half of this year, BMW sold 900 luxury sedans, an
increase of 65 percent year-on-year from 546 units.