BMW dealers sold just 1,200 of the new X5 sport-utilities in its first few weeks that the vehicles were available late last year. But the automaker already wonders if it will need to expand the South Carolina factory that builds them.
BMW probably will decide in 2001 about whether to again expand the Spartanburg County plant. It increased capacity there to add the X5 last year.
'The Spartanburg plant reached a new benchmark for BMW, introducing the X5 into production faster than any other new product launch,' said BMW AG board member Helmut Panke.
'The question we will have to answer is whether the Spartanburg factory is big enough to handle all of the plans that are coming. We will certainly look at some capacity increases beyond the current level.'
The U.S. rollout of the X5 this year is only the first step for the vehicle, BMW's first entry into what it calls the 'sport activity' segment. Like the Z3, also built in Spartanburg, the X5 was created as a world product, with the U.S. factory supplying all markets over the next few years.
One reason BMW now believes it might have to expand the plant is that it senses U.S. demand for the X5 will consume current production capacity. The plant will be able to produce just over 100,000 vehicles a year, including capacity for the Z3 roadster and its various versions.
But still unknown is what the rest of the world will demand from the X5. Europe has not yet seen the X5. And although the vehicle is probably not ideal for emerging markets, there are also opportunities elsewhere around the world.
Panke cautioned that exporting the X5 will not be possible to every market. For some markets, he pointed out, consumers will expect their four-wheel-drive vehicles to be rugged off-roaders. 'In those cases, it will be necessary to sell the (Rover) Discovery instead of the X5,' he said. BMW owns the Rover Group, maker of the Discovery.
Variations of the X5 also are planned, but officials declined to say what they might be.
Said Panke: 'We are only now ramping up, and already we are selling out.'