Radiating New Vigor
BMW’S increased investment speaks volumes of Shenyang’s improved business environment
Widely known in the past as China’s heavy industry base, northeast China is now in the midst of tremendous change. After wading through a period of economic stagnation, the region has been going all out to pursue a transformation and win favor from both domestic and foreign investors.
At a symposium on pushing forward the revitalization of northeast China held in Shenyang in Liaoning Province on September 28, Chinese President Xi Jinping noted that efforts should be made to improve the business environment and foster new growth engines, stressing the importance of equipment manufacturing for the development of the real economy.
On October 11, German luxury carmaker BMW and its Chinese partner Brilliance China Automotive Holdings Ltd. jointly announced the prolongation of the validity of their joint venture agreement until 2040, with BMW ramping up its investment by 3 billion euros ($3.45 billion) and taking a 75-percent majority stake in BMW Brilliance Automotive Ltd. (BBA). On the same day, the construction of a new factory in Shenyang’s Tiexi District was begun.
Since 2009, BMW has invested over 52 billion yuan ($7.49 billion) in the Shenyang production base, which is the largest of its kind in its global business map and includes two vehicle production factories in the Dadong and Tiexi districts, along with the one under construction.
A total of 20 billion yuan ($2.88 billion) will be invested in building the new Tiexi factory, which will cover an area of 2.9 square km, with an annual capacity of 400,000 units. It’s expected to begin car production in May 2022.
“We are confident that China is an important market for BMW to realize sustained business growth and we will continue increasing our investment and focus on the development and production of electric vehicles,” said Harald Krüger, BMW CEO, adding that BMW’S success in the Chinese market would not have been possible without the joint venture with its Chinese partner.
In fact, when Chinese Premier Li Keqiang met with German Chancellor Angela Merkel in Berlin, Germany, in July, they were witness to the signing of the agreement of increased investment in China between BMW and Brilliance.
In his congratulatory letter, Li said that