BMW in South Carolina: Two decades and thriving
By Trisha Ostrowski
Even after 20 years, the success story continues for BMW in South Carolina, and new chapters continue to be written. BMW has expanded its plant on Interstate 85 near Spartanburg, S.C., five times and has produced more than 2 million vehicles. To date, BMW has invested about $6 billion in South Carolina, employing nearly 7,500.
BMW's most recent major expansion came in 2012. The company announced it would invest another $900 million to increase the plant's manufacturing footprint by 1.6 million square feet, adding another vehicle model and boosting the overall volume of vehicles produced.
Why South Carolina?
From the beginning, BMW liked the land and tax incentives offered by the state along with its easy access to interstates and the Port of Charleston. It also didn't hurt that South Carolina is a right-to-work state with little union activity.
In 1992, when the project was first announced, South Carolina beat out Nebraska, whose governor at the time complained that he "couldn't move the Atlantic Ocean." In fact, proximity to the Port of Charleston, the nation's fourth-largest container port, has proven invaluable.
"The infrastructure that exists in South Carolina is ripe for manufacturing," said Sky Foster, BMW's department manager for corporate communications. "The plant site's proximity to a deep water port with direct rail access between the plant and the Port of Charleston is ideal, considering 70 percent of our vehicles are exported to 140 countries around the world."
Along with location and infrastructure, Foster points to sustained high global demand for BMWs produced in South Carolina (the X3, X5 and X6), along with workforce as key reasons why BMW has continued to prosper in South Carolina. "BMW leverages South Carolina's technical education system to attract and train a qualified workforce," Foster continued. "For a variety of reasons, BMW's plant in Spartanburg has proven itself as a vital link in the BMW global production network, paving the way for the decision to produce the all-new BMW X4 at the South Carolina plant in 2014."
Another benefit for BMW has been the opportunity to partner with South Carolina's research universities. For example, the company has partnered with nearby Clemson University to create the International Center for Automotive Research (CU-ICAR), an advanced technology research campus and home to the nation's only graduate department of automotive engineering.
The "BMW Effect"
BMW's continual growth has had a profound impact on the state economy, and a parade of suppliers has followed BMW to the Palmetto State.
"I call it the 'BMW Effect,' " explained South Carolina Commerce Secretary Bobby Hitt. "When BMW announced more than 20 years ago that it would build its first full manufacturing facility outside of Germany in South Carolina, the company pledged to invest $600 million. Today, the automaker has gone through five major expansions and increased its investment in South Carolina to nearly $6 billion.
"In all, South Carolina is home to more than 250 automotive-related companies and suppliers that employ over 45,000 people. And it is BMW's presence here that has allowed that to happen," Hitt continued. "A car is about the most complex consumer product there is, and BMW's success here shows companies from around the world that South Carolina workers know how to build things, and build them well." Hitt noted that as BMW continues to grow and the state's other OEMs flourish, new opportunities exist for automotive suppliers. For example, South Carolina is becoming a major force in tire manufacturing, fueled by the state's flexible workforce and logistics advantages.
"Last year, we had a remarkable amount of tire industry investment. South Carolina will be far and away the largest tire producing state within five years," Hitt said. "We in South Carolina focus on manufacturing and manufacturing-related activities because we see manufacturing as the key to growing wealth in the state and helping the middle class move forward. And we've been pretty successful in recruiting manufacturing investments over the years – especially in the automotive industry."
Could South Carolina accommodate another assembly plant?
Kentucky has four, Alabama and Tennessee three each and Texas, Mississippi and Missouri have two. Those are the states in the Southern Auto Corridor that are home to two or more major automotive assembly plants.
BMW operates in South Carolina and Kia in Georgia, the only other states in the South with operating assembly facilities. A mature automotive supply chain in those two states and just one plant make them attractive for the next round of automobile factories.
There are some landowners in South Carolina who are betting big bucks on landing another plant. In fact, South Carolina may have the largest number of shovel-ready megasites in the South. Some of those sites are listed below:
- Central South Carolina Megasite - Kershaw Co., S.C.
- White Hawk Commerce Park - Florence, S.C.
- I-95 Megasite - Clarendon County, S.C.
- Carolinas I-95 Megasite - Dillon County, S.C.
- I-77 Megasite - Chester County, S.C.
- Jafza Magna Park - Orangeburg County, S.C.
- *Newberry Site - Newberry, S.C.
We asked South Carolina Commerce Secretary Bobby Hitt if there is room for another assembly plant with BMW in the Upstate and Boeing in the Lowcountry. "The answer is an unequivocal 'yes'! South Carolina's OEMs like BMW, Honda and Daimler have been extremely successful here, and they continue to invest and expand in our state. The success of South Carolina's OEMs proves that we are well-equipped and well-positioned to accommodate manufacturers looking to locate in our state. We are a customizable state and we work one-on-one with companies to fit their needs – this is the South Carolina advantage. Whether it's having a large number of sites available, a stable infrastructure, low energy rates or a highly-skilled workforce, companies know that if they come here, South Carolina has what they need to be successful."