BMW to make Thailand its regional hub

BMW to make Thailand its regional hub

BANGKOK (AFP): German automaker BMW AG announced plans Saturday to build cars in Thailand, with the aim of turning the country into its regional manufacturing hub.

Executives from the firm officially launched two new companies to make and export cars, but warned that the project's future depended on further trade liberalization in the region.

"The board of the BMW Group has decided to establish a manufacturing plant for BMW and Rover Group vehicles in Thailand," marketing executive and board member Wolfgang Reitzle said.

BMW manufacturing (Thailand) Co. Ltd. will be wholly owned by parent BMW AG, while a wholesale subsidiary Bayerische Motoren Werke (Thailand) Co. Ltd. will be 51 percent owned by Thailand's Thepsatri Co. Ltd.

But executives said "second step" plans to expand beyond local sales would depend on moves by Asian countries toward removing trade barriers and creating a free trade area.

Executives said the new plant, on Thailand's eastern seaboard, already the home of Ford and General Motors, would involve an initial investment of one billion baht ($25.5 million) and would turn out 10,000 vehicles a year by 2004.

Construction of the new plant is due to begin later this year and the first vehicles will roll off production lines in the year 2000 at the rate of 5,000 per annum, a statement said.

The first model to be produced will be the new BMW 3 Series. Landrover and Rover cars will also eventually be produced.