BMW mulls a Mexico plant to keep up with demand

BMWs and Minis could become significantly cheaper to build if plans for a second North American factory for the German company come to fruition. According to German newspaper Handelsblatt, BMW is looking at building a factory in Mexico, which would build Minis alongside BMW 1 Series and 3 Series variants.

The speculation comes after BMW's CEO Norbert Reithoffer said earlier this year that BMW would need a second North American plant to keep up with demand. BMW already builds all of its X-model SUVs, as well as the Z4 convertible, in a factory in Spartanburg, North Carolina, and has just confirmed an expansion plan for that factory to allow it to build the new seven-seat X7 luxury SUV. A plant in Mexico, with its lower wages and production costs, could boost profits on more affordable Mini and BMW models, especially given the increasing strength of the euro agains the dollar.

Meanwhile, BMW's head of M-Car production, Carsten Priese, has been talking up the prospect of future M models returning to the four-cylinder, high-revving engine roots of the original M3 saloon. Speaking to Motoring. com in Australia, Priese said: "We do not start our design process with a power output in mind. We have a set of characteristics that a new model must meet. For sure, you could see a future M3 powered by a four-cylinder engine."

That chimes with what BMW board member for marketing Ian Robertson told The Irish Times at the recent M3 launch. "Certainly we wouldn't rule out a hybrid M-model at some point," he said. "It's all about finding the appropriate power plant to get the performance you want from the car."