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BMW May Drive Growth for Suppliers by David Dykes
"The automotive industry in the U.S., especially here in the Southeast, is growing," Stefan Bude, president and chief financial officer for DAA Draexlmaier Automotive of America, told The Greenville News. "For us, at Draexlmaier for sure, it will be a positive impact on our growth strategy."
The company is quick to point out BMW is one of its many customers.
But with a recently announced $1 billion expansion in Greer — giving the local BMW plant the largest assembly capacity of any plant in the company’s global production network — BMW clearly is in the driver’s seat in South Carolina auto investment, which in turn attracts industry suppliers.
BMW’s growth will mean incremental opportunities for existing suppliers and could draw new ones, said Mike Wall, an auto analyst with IHS.
Last month, BMW said it would invest $1 billion in Greer to expand its only U.S. manufacturing plant, increase capacity 50 percent to 450,000 vehicles per year, add 800 jobs and produce a new, larger SUV for the company’s world markets.
The 20-year-old plant is near capacity, producing about 1,100 vehicles each working day, or about 300,000 annually. The facility has about 8,000 workers.
Manfred Erlacher, president of BMW Manufacturing Co., said the latest production announcement will mark the company’s fifth expansion since work began in the Upstate.
"The increase in annual capacity, the number of models produced and the number of jobs on site, reinforce the major role BMW is playing in the region’s economic vitality through technological innovation, environmental stewardship and development of a highly skilled work force," he said.
In addition to the company’s large-scale capital investments, a study by the Moore School of Business at the University of South Carolina said the BMW Group has a $16.6 billion annual impact on the state’s economy and its presence supports more than 30,000 jobs throughout South Carolina.
The study found that for every job created at the BMW plant, an additional three jobs are created elsewhere in South Carolina through the economic multiplier effect.
Locating BMW’s plant in the United States led to the creation of a diverse, North American supplier network encompassing 170 companies from Canada to Mexico to California.
Soon after BMW said it would build an automobile manufacturing plant in the Upstate, many supplier companies began seriously considering operations in the Southeast.
Today, about 40 South Carolina suppliers are located within a few hours’ drive of the Greer plant, according to state and industry officials.