BMW May Open an Engine Plant in U.S. or Mexico

BMW AG could decide next year to build its first North American engine factory, according to Bloomberg News, which cites three unnamed sources.

The facility, which to be located in the U.S. or Mexico, would supply BMW's assembly operations in the region. The company current imports engines from Europe, and building them in North America would reduce production costs.

BMW currently assembles more than 300,000 X3, X5 and X6 crossover vehicles per year in Spartanburg, S.C., 70% of which are exported. The facility will add X4 crossover production next year and is expected to boost capacity to 350,000 within the next few years.

The company told Automotive News in August that it might open an assembly plant in Mexico several years from now.