Report – BMW considering North America engine plant image

The German company, the world’s biggest premium automaker, is considering building engines in North America for the first time and expanding vehicle production in the region according to three people familiar with the matter.

BMW could decide on the matter in 2014, while the plant is considered for either US or Mexico, according to the people, who asked not to be identified because the talks are confidential.

The carmaker would join German premium-auto rival Mercedes-Benz in producing engines in the region as Asian and US rivals already do. Mercedes will start using motors next year built at a Nissan plant in Tennessee. BMW has largely restricted its engine-making to Europe, only announcing a plan last year to build 4-cylinder units in Shenyang, China, to supply the company’s local car plants in Dadong and Tiexi.

The German company set up its only North American factory in Spartanburg, South Carolina, in 1994. The site, which produces all of BMW’s X3, X5 and X6 sport-utility vehicles, is one of the U.S.’s main auto exporters. BMW may expand vehicle-making in the region beyond a new model already announced for next year, the people also said.

BMW, Mercedes and Audi are all adding production in North America to take advantage of sales-growth potential that contrasts with stagnating demand in their home market of Europe.

Via Bloomberg