Wed, Jun 28, 2017 - Page 10 News List

BMW to increase investment, jobs in US to court Trump

Bloomberg

BMW AG is bolstering its best defense against US President Donald Trump’s trade tiff with Germany, boosting its investment and employment in the US and even inviting the president to join the party.

The German automaker on Monday unveiled the revamped X3 sport utility vehicle at its plant in Spartanburg, South Carolina, and announced plans to increase spending and create another 1,000 jobs.

The facility is BMW’s biggest in the world and an important shield against Trump, who has threatened automakers over their imports — and declined the company’s solicitation to attend Monday’s festivities.

“Free trade has made this success story in the US possible,” BMW CEO Harald Krueger said at an event celebrating the factory’s 25-year anniversary. “It is essential for global businesses and economies around the world to flourish.”

The redesigned X3, on sale this fall, will reinforce BMW’s position as the US’ biggest car exporter on a net basis, with vehicles worth more than US$10 billion shipped abroad per year.

While Trump’s early pronouncements targeting automakers have receded as other political fires consume his time, the growth at the Spartanburg site helps the second-biggest luxury automaker build goodwill with the White House and guard against the attacks returning.

Executives were joined on stage by South Carolina Governor Henry McMaster, who called the German automaker “the gift that keeps on giving,” and US Senator Lindsey Graham, who was more direct in his defense of free trade.

“I’m an American politician who likes German cars,” he told the crowd.

Graham — who said he drives a BMW — called on Trump to negotiate a trade deal with Europe so the US could export cars there without a tariff, as Mexico does.

“To those who fear globalization, embrace it, because it’s not going away,” he added.

Trump singled out BMW in January, threatening to slap the automaker with a 35 percent import duty for foreign-built cars if it proceeded with plans to open a new plant in Mexico, German newspaper Bild reported.

He reportedly told EU officials in a closed-door meeting in May that there would be a stop put on the millions of vehicles German automakers sell in the US.

BMW production chief Oliver Zipse said he was hopeful the firm’s free-trade message would get through to the White House.

“The president is important. Full stop,” he told reporters in South Carolina. “We think logic will prevail; that’s our hope, but of course we’re part of a political arena, and at the end of the day, we will follow politics — we will not counter politics.”

BMW has invested US$8 billion in the Spartanburg plant since it was announced in 1992 and is to spend another US$600 million between next year and 2021.

It is also plunking down an additional US$200 million for employee training and education at the facility, Krueger said.

The factory employs more than 9,000 people, with another 1,000 jobs to be added through 2021. Production last year climbed to a record 411,000 units, with about 70 percent of those vehicles exported.

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