BMW may expand Mini plants to Netherlands

BMW IS in talks to begin making some of its Mini cars at a plant used by Mitsubishi Motors in the Netherlands, the company said, because the Oxford plant that produces the small-car brand was reaching capacity.

The German premium carmaker made the announcement yesterday as it said it would invest another £250 million in its British operations by 2015 as it expands the brand to include up to 10 models in the mid-term.

Mini said that because of the extra production volumes, the brand’s growth strategy entailed and the complexity of the new lines, it was looking for additional capacity beyond Oxford “and the company is now considering how to achieve this”.

BMW said its preferred option was to establish satellite production with a contract manufacturer as close to Mini as possible and that it was in discussions to do this at the Nedcar plant, in Born, in the Netherlands, currently used by Mitsubishi.

The Japanese carmaker, which produces its Colt small car and Mitsubishi sport utility vehicle there, plans to stop producing cars at the plant as part of a plan to cease manufacturing in Europe by the end of 2013.

Since reviving the Mini brand a decade ago, BMW has expanded its line-up to include several model variants, including a cabriolet, coupe and SUV.

“Over the last 11 years, Mini has been a unique global success, and the BMW group has even greater plans for the future development of the brand,” Harald Krueger, a BMW board member, said in a media release.

The £250 million new investment comes on top of a £500 million investment in Mini the Munich carmaker announced last year. The announcement coincided with a visit by Vince Cable, Britain’s business secretary, to the plant.

Britain is the company’s second-largest manufacturing site in Europe after Germany. The carmaker and its dealers employ 18,000 people and says it contributes £1.2 billion directly a year to Britain’s gross domestic product.

Mr Krueger said Mini’s Oxford hub would continue to provide production expertise for any new operation outside Britain, including operating multi-model production lines. – (Copyright The Financial Times Limited 2012)