BMW Poised to Hike SUV Production in China

BMW AG, which sources most of its SUV/crossovers from its huge plant in Spartanburg, S.C., says it is weeks away from a decision to move some of that output to China.

Doing so would avoid China’s 40% tariff on vehicles imported from the U.S., a result of the escalating trade war between the country and the U.S. Earlier today BMW said the rising taxes are likely to reduce its earnings this year by €300 million ($343 million).

BMW says its highest-volume SUV sellers in China are the most likely candidates for production reassignments. Earlier this year, tariffs prompted the carmaker to stop shipping its X3 compact crossover from the U.S. to China and supply those vehicles from plants in China and South Africa, Reuters notes. BMW says sales of X3 models in China have grown since then.

The company’s Spartanburg factory currently builds X3, X4, X5, X6 and, beginning next month, X7 crossovers at a rate of 370,000 units per year. Nearly 75% of the facility’s output is exported.