BMW manufacturing

BMW Manufacturing chief: ‘It has all worked out for us’

In the early 1990s, the BMW Group was looking for a place to expand. It had recently found success in South Africa with its Rosslyn plant, as well as its facilities in Dingolfing, Regensburg and Eisenach in Germany and Steyr in Austria, and it was looking for additional expansion capability.

Enter South Carolina.

On Sept. 8, 1994, the BMW Group started production at its first North American production facility, located in the Upstate of South Carolina. It has now grown into the largest auto manufacturing facility in the BMW Group chain, recently closing on $9.8 billion in exports in 2015.

BMW Manufacturing Co. President Manfred Erlacher said in an interview with GSA Business Report that even though there were only “about 60,000” BMWs sold in North America, the company recognized “a lot of possibilities” with the location of a plant in Spartanburg County.

“There was a highly skilled workforce around and we recognized there is a really pro-business attitude in South Carolina,” Erlacher said. “The infrastructure with the highways and the port and Charlotte gave us really good possibilities to expand in the future.”

Fast-forward more than 20 years later and the BMW Group is in the midst of completing a $1 billion expansion to the Upstate facility that will further increase vehicle production from its current 400,000 vehicles per year to approximately 450,000. Erlacher said construction is expected to be complete in 2017 and the facility will be ready to welcome the new X7 model to add to the X series lineup exclusively produced in South Carolina.

“I think no one dreamed that it would be possible,” Erlacher said. “We recognize that we are still growing and we will increase our employment by an additional 800 jobs by the end of this year.”

Erlacher has been with the BMW Group for more than 30 years. He was appointed BMW Manufacturing Co. president in November 2013. He succeeded Josef Kerscher, who returned to Germany to head operations at the group’s Dingolfing plant in Bavaria.

Prior to joining BMW Manufacturing, Erlacher was head of the group’s Leipzig, Germany, plant and led the plant through expansion to produce the BMW i3 and i8. Over his career at BMW, Erlacher also led assembly and body shop operations at the Munich plant before being named the managing director of the plant.

In the two full years since being named head of BMW Manufacturing Co., the facility has begun production of the second-generation X6 coupe; underwent the $1 billion expansion, the fifth expansion of the plant since its opening; announced the future production of the X7; and generated more than $16 billion in annual economic impact to the state.

On top of all of that, Gov. Nikki Haley told a group of auto suppliers at the recent S.C. Auto Summit that it was BMW that helped attract other companies such as Daimler and Volvo to the state. Erlacher said the company believes it is all about being a good resident.

“We want to be a part of the community where we live,” Erlacher said. “In South Carolina, there are very friendly and supportive people, and we want to be a part of that.

“The attitude of the government, the Department of Commerce, the (S.C. State) Ports Authority and the colleges has been great, and we want to give back a little bit. We think this is a game changer to show what is possible here in South Carolina.”

Heading into a future filled with talk of new technology, Erlacher said the Upstate plant will remain focused on helping to implement things like alternative power engines, hybrids and increased connectivity to the internet. Autonomous driving will also be in the mix, and Erlacher said “it will be a challenge to innovate those changes in our plant.”

“We have to make sure all these things work properly,” Erlacher said. “In the next 10 years, we have to have the right qualifications here, and we want to really have perfect products for our customers.”

For the immediate future, he said the increase in demand for the cars being produced continues to increase — global sales of the X models have trended up over the last six months, according to the BMW Group — and the associates at Plant Spartanburg “are doing a really good job to get out that volume.” The company does not expect to see that trend slow down as recent sales forecasts by the company are for more sales records to fall in 2016.

And, Erlacher said the company still believes locating its first North American plant in the Upstate was the best decision for the BMW Group.

“Now, more than 20 years later, we can say ‘Yes, it was all that we predicted,’ and all of this has worked out perfectly with positive results,” Erlacher said. “It was the best to come to the Spartanburg area.”