GERMANY'S BMW CONFIRMS QUEST FOR POSSIBLE PLANT SITE IN THE US

GERMANY'S BMW CONFIRMS QUEST FOR POSSIBLE PLANT SITE IN THE US

German luxury automaker BMW AG confirmed it is scouting for a possible plant site here in the United States.

Company officials indicate they are developing a "long-range" strategy that could require them to increase worldwide production capacity."It's an active study looking at future capacities and where (any new production facility) should be located," said Thomas McGurn, a BMW spokesman in the United States.

Officials with the governor's office in South Carolina indicated they met last Tuesday with representatives from BMW and toured several large plots of land in Anderson County, about 45 minutes from Greenville.

South Carolina has been aggressively seeking European investments. It has a trade office in Germany and already serves as home to a number of German firms, including the supplier, Robert Bosch Corp., which builds anti-lock brakes at a plant in Charlotte.

Mr. McGurn, however, would not confirm that the Anderson County site is one of those on BMW's list.

"They're looking at various sites," he said cautiously. "We just don't want to list a bunch of sites. We may not come here at all."

The news that BMW is even looking in the United States comes as a surprise to many industry observers, including auto analyst William Pochiluk of Autofacts Inc. Mr. Pochiluk notes that BMW sold just 52,281 cars in the United States last year, down from 62,794 in 1990.

Yet he points out that economies of scale suggest "you need to have production capacity of at least 125,000 units a year to justify an assembly plant."

While U.S. sales have been declining, foreign sales have been rising, particularly in the Japanese market. Worldwide, BMW produced 525,000 vehicles last year.

Mr. Pochiluk also wonders whether a U.S. plant would cause BMW to lose some of the "German mystique" that is so much a part of the products it sells.

For that reason, Mr. Pochiluk contends that any U.S. plant for BMW would more likely be dedicated to producing components. South Carolina sources indicate that was one option mentioned by BMW.

Mr. McGurn refused to rule out any possible use for a U.S. site.

Another option would be to build an American technical center similar to the design and research facilities a number of European and Asian carmakers have already opened in the United States.