BMW Considers an Engine Plant in North America

BMW AG may decide next year whether to erect a North American engine plant in Mexico or the U.S., according to Bloomberg News, which cites three unnamed sources.

The engines would be used by the company's local operations. BMW opened a U.S. assembly plant in South Carolina in 1994. Last year the facility made 301,500 X3, X5 and X6 crossover vehicles. All were equipped with engines made in Europe, and about 70% of the vehicles were exported. Next year the plant will add X4 crossover production.

BMW has said it will hike annual capacity at the U.S. facility to 350,000 units within the next few years. The company also told Automotive News in August that it might open an assembly plant in Mexico several years from now.

Bloomberg notes that BMW's only engine factory outside Europe today is one in Shenyang, China, that makes 4-cylinder gasoline engines for its assembly operations in the country. The company plans to double annual capacity to 400,000 engines by opening a second facility in Shenyang in 2015.