German Auto BMW Ramps Up Investment in China

[legendguru]

BOOK INTERNATIONAL FLIGHTS TICKETS LOCAL FLIGHTS HOTELS BOOKINGS WORLDWIDE AND MORE AT CHEAPEST RATE EVER! CLICK HERE TO BOOK YOUR FLIGHT AND RECEIVE YOUR FLIGHT TICKET INSTANTLY

Loading...

German automaker BMW is taking a majority stake in its China joint venture and investing 3 billion euros ($3.5 billion) in factories there, underscoring the importance of the Chinese market as the company prepares to meet increased demand for electric vehicles.

Munich-based BMW said Thursday it would pay 3.6 billion euros ($4.2 billion) to raise its stake in BMW Brilliance Automotive Ltd. to 75 percent from 50 percent.

Alongside the deal, BMW will invest in new and existing plant facilities in Shenyang, increasing production capacity to 650,000 vehicles a year from the early 2020s. The plants produced 400,000 vehicles last year.

A new plant will be able to produce fully electric, partly electric, and conventional vehicles on the same line.

The Chinese government has issued a new energy vehicle mandate which uses a system of credits to push automakers to increase the share of battery-only and hybrid cars in their sales mix. The policy is expected to increase the number of electrically powered vehicles in the world’s largest car market in coming years. Last year, battery-only and hybrid cars were 2.2 percent of the Chinese market; the International Council on Clean Transportation estimates that could rise to around 4 percent by 2020 under the policy.

The country is BMW’s single largest sales market, with 560,000 vehicles sold there last year.