Tramp’s Tariff Plan is not Holding Back BMW from Completing its Mexico Plant

Despite the recent threats of 35 percent levy on cars imported to the US, BMW is closing in its completion of $1 billion manufacturing plant in Mexico.  The company is planning to make nearly 150,000 units of its next-gen 3-series sedan in the new San Luis Potosi facility, which will be fully operational by 2019.  In addition, the carmaker is planning to stop exporting the 3 series from its South African plant and focus on making X3 crossover instead.

In simple words, BMW is installing 3-series assembly capacity in the new plant in Mexico to supply worldwide. However, the company is yet to decide on where exactly to ship those cars depending on the development of the international market condition. The company disclosed its plans in Detroit recently. Over the recent past, Trump has smartly cornered up companies following business theories he dislikes.  On several occasions, Ford Motor has found itself on the receiving end of some major Trump fury. Ford recently dropped its plans to set up a $1.6 Billion plant in Mexico and focus on investing in the United States, which will lead to the creation of new jobs in the country.

Meanwhile, for BMW, the picture are quite clear as President-elect Donald Trump has boldly expressed his views, suggesting a 35 percent levy on cars that BMW import from other countries including Mexico that are to be sold in the US. Moreover, the incoming Trump administration will not allow exemption of border tax to any of the carmakers operating in the country and made its intention clear on it.

Currently, BMW employs approximately 70,000 people in the U.S., including both direct and indirect employments and has been the primary source of production capacity for the company.  Whereas, its premium rival Audi, which is also based in Germany rather chose to build its facility in Mexico, overlooking the possibilities of setting one in the US, sighting the scope of exporting from Mexico with higher cost benefits.

Summary:  BMW stays firm on its decision of starting the brand new Mexico plant event after border tax threats from Trump

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