China-made BMW 5 Series Export

The first batch of long-wheelbase BMW 5 series exported overseas has been quietly parked at Shenyang Brilliance’s Dadong Plant. After all legal and customs procedures have been completed, it can be delivered via the Tianjin Port. As for the destination, it may be the Middle East, possibly Africa, or Russia. This move created a precedent for the manufacture of luxury cars in China.

“The 5 Series export is a strategic consideration and deployment in the long run. This deployment is first to explore and test the situation in the international market,” according to Kang Siyuan, President and CEO of BMW Brilliance Automotive Co., Ltd. The export of Series 5 is only a test of water, and domestic consumers do not have to worry about affecting the supply in the domestic market, and do not have to worry about whether BMW will accept this version of the BMW car in overseas markets. For BMW, which is dedicated to every opportunity, the strategic deployment has already begun when the Chinese luxury car market has fallen from an 80% arrogance and its world's most advanced factory is being built in China.

After more than a year of planning, the first departure of the BMW 5 Series at the end of this year is just the beginning.

The potential of the 5 Series On December 2nd, at the factory in Dadong District, Shenyang, BMW Brilliance held a grand export ceremony for the long wheelbase of the BMW 5 Series.

BMW Brilliance is the only joint venture manufacturer of the BMW Group. From the perspective of BMW's headquarters in Germany, although the long wheelbase of the BMW 5 Series is tailored to the Chinese market, it is a pity that it will only be limited to sales in China.

As Fang Nord, senior vice president of production and technology at BMW Brilliance Automotive Co., Ltd. stated, “BMW has two basic principles. The first one is the market decides production. The demand in the Chinese market is very strong, so we must establish a production base here. The second principle is that the models we produce can be sold in any other market and meet our global quality standards. The BMW 5 Series long wheelbase exports also reflect this basic production principle."

Regarding the original intention of the export strategy, Fang Norte stated that one of the objectives is to avoid possible risks in the Chinese market. “If there is a change in demand in the Chinese domestic market in the future, at least we have the export channel to sell our products to other markets in the world.” Kang Siyuan expressed the same view, saying that "If a company looks at the market with a long-term perspective, it must be able to foresee how it can continue to maintain this sound and steady development if the market fluctuates in the future.

Kang Siyuan said that the success of the 5-series long wheelbase in China has attracted the attention of many markets, including markets in Africa, the Middle East, and Russia. "We have a very limited number of exports, which also determines that we cannot fully meet the needs of the place currently." The long wheelbase of the BMW 5 Series, which was launched in the second half of last year, was developed and manufactured by BMW Group and BMW Brilliance in accordance with the needs of Chinese customers. The second-generation long wheelbase product, the vehicle sales growth of nearly 90% in one year, the market share increased from about 15% a year ago to more than 27%.

The analysis pointed out that BMW itself is an export-oriented enterprise, two-thirds of its output is exported, and its export destination is concentrated in highly industrialized countries such as the European Community, Japan, and the United States. According to statistics, the Middle East, Africa, and Russia that will be exported to the extension of the 5 Series will not have a large share in BMW's global layout, but they are all potential growth markets.

Take the example of the strong demand for BMW cars in Russia. In 2010, BMW sold 18,600 vehicles in Russia, ahead of Mercedes-Benz and Audi. However, due to the limited production capacity, the locally-produced BMW models in Russia are also in short supply. After Russia was out of stock in 2010, BMW's goal of expanding production at the Kaliningrad manufacturing plant was put on the agenda. However, compared with China, its expansion costs and new product prices are relatively high.

The same is true for other markets that BMW intends to explore, and the analysis points out that in this sense, China has become a bridgehead for BMW to expand into emerging markets and maintain its leading position in the global luxury car market.

Kang Siyuan disclosed that preparations for production, logistics, procurement, finance, and IT are currently in place. Because the long wheelbase of the BMW 5 Series has been in strong demand in the domestic market, and product export involves the adjustment of the overall operating system such as production and logistics, the first export business will be carried out in small batches.

With the iron chip West in China, with the approach of 2012, a new round of luxury car competition is about to start. Among them, the commissioning of the BMW Tiexi plant is expected to become a new bargaining chip to reverse the competitive landscape of the three major luxury cars in China.

The production of clamps for the sales of luxury cars clearly showed in the past November. In November this year, although BMW also achieved impressive results with an increase of more than 40%, it still has not completed its task of surpassing. Thanks to the release of production capacity, in November, sales volume of the Audi A4L and Q5 models both increased significantly compared to the same period of last year. At the same time, the sales of the Audi A4L and Q5 continued to be top of the list with nearly 30,000 cars and an increase of 70%.

According to the plan, the new BMW Brilliance plant in Tiexi District, Shenyang will be completed and put into operation in early 2012. The first model will be the BMW X1. Before the end of 2012, the new BMW 3 Series will also be put into production at the new plant. The plant in Dadong District will continue to tap production capacity and fully invest in the new 5 Series production. It is reported that the plant in Dadong has already started a capacity upgrade project to prepare for more demand for the long wheelbase of the BMW 5 Series.

"We have built a new plant, plus the Dadong plant, the production capacity should be between 150,000 to 300,000, which is a very flexible plan." Kangsi Yuan said.

Obviously, as the first of the three major luxury cars to launch new production capacity next year, BMW's desire to climb in China is even closer.