Car News&Gist: BMW Focus On 5% Cost Reduction Annualy As It Reorganizes Fwd and Rwd Production

2017 BMW M4

BMW Group will reorganize its global production network into factories that build only rear-wheel drive cars and plants that produce just front-wheel-drive models as it seeks to reduce costs.

The change is a key element of BMW’s new production process called “Manufacturing 4.0.” The plan also calls for higher digitalization, improved logistics and more vehicle assembly using robots.

“Our aim is to reduce production costs by 5 percent year over year,” said Oliver Zipse, BMW’s manufacturing chief. “Streamlining platform allocation is a crucial element in attaining this goal,” he said on the sidelines of the company financial results presentation on March 16.

BMW has 10 full assembly factories in its global network, including plants in England and the Netherlands that build Mini vehicles.

In future four plants will build only fwd vehicles and five will build only rwd vehicles. An exception to the fwd/rwd rule will be BMW’s plant in Tiexi, China, which will continue to build both types of vehicles. All factories will be able to produce four-wheel-drive cars because BMW’s fwd and rwd platforms are also 4wd capable.

The reorganization will streamline the assembly process and the flow of inbound components, Zipse said.

The change mainly affects BMW’s Regensburg and Leipzig factories in Germany, which will produce only fwd vehicles in the future. BMW’s fwd drive cars include the 2-series Active Tourer and Grand Tourer minivans, as well as the new X1 compact SUV and a China-only compact sedan.

Regensburg currently build nine different models based on three platforms from the Z4 roadster to the X1 SUV. It is BMW’s plant with the highest complexity. Within three years, the factory will switch to building just fwd models, Zipse said.

The Leipzig plant will convert to fwd models only within four years, but it will keep a dedicated area to build models for i subbrand. Zipse declined to comment if Leipzig will also build a new i model dubbed iNEXT, which is due after 2020.

BMW’s factories in Munich, Germany; Rosslyn, South Africa; Spartanburg, U.S.; and Dadong, China will continue to build rwd cars.

The company’s Mini plants in Oxford, England, and Born in the Netherlands, will continue to manufacture fwd Minis.


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