BMW begins output at new $2.2B plant in China to accelerate EV push

SHANGHAI -- BMW said that production has formally begun at a new plant in China with an investment of 15 billion yuan ($2.24 billion) as the automaker accelerates electric vehicle output.

The plant, BMW's third car assembly facility in China, located in the northeastern city of Shenyang, Liaoning province, will increase BMW's annual output in the world's biggest auto market to 830,000 vehicles from 700,000 in 2021, the company said in a statement.

The plant, a joint venture between BMW and Chinese automaker Brilliance, is designed to produce full-electric vehicles only, according to market demand, on flexible manufacturing lines, BMW said.

“By the end of 2025, the BMW Group expects to have delivered more than two million pure electric vehicles worldwide, with one in every four new vehicles sold in China being a pure electric model,” BMW Group said.

BMW Group in February raised its stake in BMW Brilliance to 75 percent from 50 percent. The joint venture only assembles vehicles for BMW brand.

The first model in production at the Lydia plant is the i3, a full-electric sports sedan, BMW said, increasing the range of its EV models for Chinese customers to 13 next year.

Tesla and Chinese automakers such as BYD dominate China's booming EV market, with sales more than doubling from a year ago.

Meanwhile, legacy automakers that have relied on the internal combustion engine for decades, such as General Motors and Volkswagen Group, are falling behind.

Nearly a quarter of the cars sold in China in the first five months of this year were battery powered, according to data from the China Association of Automotive Manufacturers.

BMW’s China sales fell 9.2 percent to 208,507 in the first quarter, according to a company filing.

China is the largest market worldwide for BMW Group. In 2021, it delivered 846,237 vehicles under the BMW and Mini brands in China, an increase of 8.9 percent from a year earlier.

In 2018, the German luxury car maker signed a deal with Great Wall Motor Co., China’s largest light-truck maker, to establish a 50-50 joint venture to produce electric vehicles for Mini.

That partnership is slated to start production at a plant in the east China city of Zhangjiagang in 2023.

Reuters contributed to this report.