BMW to increase auto parts sourcing from China

BMW AG, the world's largest luxury car maker, will increase sourcing from China this year to buy RMB 4.4 billion (US$619 million) worth of spare parts from 150 domestic suppliers, compared with RMB 3.6 billion in 2007, according to Alfred Rupp, president and CEO of BMW Brilliance Automotive Ltd.

"The local sourcing is crucial for BMW in China, as we have to remain competitive price to attract buyers in the world's second-largest auto market despite the higher costs." said Rupp. The joint venture has been optimizing its operations for better production efficiency to offset surging costs of raw materials.

Rupp disclosed that BMW will increase its dealerships from last year's 90 to 120 outlets by the end of this year, and plans to import its BMW 1 Series in April to broaden its product mix.

BMW held a ground-breaking ceremony for its biggest training center in Asia in Shanghai's Jiading District yesterday, which costs RMB100 million with the first phase scheduled to be completed by the end of this year.

BMW sold 51,588 vehicles in mainland China last year, up 42% from the previous year, just next to Audi in the luxury car market. The Munich-based auto maker said earlier it will lift production capacity in China plant by 45% to an annual 44,000 units in the next few months.