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July 16, 2003
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BMW Group establishes sales subsidiary in Malaysia
 

Munich. As part of its Asia strategy, the BMW Group is considerably expanding its involvement in Malaysia. The establishment of a sales joint venture with the Group's local partner Sime Darby Berhad forms the core of this involvement. In addition, the company has set up a new IT centre for the Asia-Pacific-Oceania region in Kuala Lumpur. The Group's involvement in Malaysia is rounded off by a new regional parts distribution centre which will start operation in 2004. Together with its local partners, the BMW Group is investing a total amount of more than 21 million euros in the three projects. The BMW Group is thus continuing its market initiative consistently and creating an important structural framework for its envisaged growth in Asia. The company is planning to double the sales volume in its Asian markets in the next five years, from 78,500 automobiles in 2002 to around 150,000.

The new sales subsidiary, BMW Malaysia Sdn Bhd, will be based in Kuala Lumpur and will commence business activities on 1 August 2003. The BMW Group has a 51% holding, whilst Sime Darby holds 49% via the subsidiary Tractors Malaysia. Sime Darby has been operating in Malaysia for the BMW Group as a partner in the sales business and the operation of the local assembly plant for BMW automobiles since 1987. The joint venture will be responsible for, amongst other things, pricing and product strategy, marketing, dealer development and after-sales. Sales to customers will continue to be carried out by independent dealers. The total investment in the joint venture amounts to euro 7.9 million.

Lueder Paysen, head of the BMW Group's sales region Asia, Pacific, Africa and Eastern Europe, said today at a press conference in Kuala Lumpur: "With the new sales subsidiary, we are able to further intensify our presence in the market and fully exploit the high growth potential in Malaysia. In Sime Darby, we have an ideal, tried and tested partner who, with its sound knowledge of the market, will play an important part in the success of the joint venture."

In the first six months of 2003, the BMW Group in Malaysia sold a total of 1,132 BMW and MINI brand automobiles (previous year 1,123 automobiles) and thus stabilised sales at a high level. In June, an increase of 17.9% to 283 vehicles was achieved (previous year 240 automobiles).

With the joint venture in Malaysia, the BMW Group now has 28 sales subsidiaries worldwide, including six in Asia (Japan, South Korea, Thailand, the Philippines, Indonesia, Malaysia). In addition to the sales subsidiaries, the BMW Group operates five assembly plants in Asia altogether - in Vietnam, Thailand, the Philippines, Indonesia and Malaysia. At the end of March 2003, the BMW Group also signed a contract in Beijing relating to a production and sales joint venture in China. Construction of the plant in Shenyang in Liaoning province is running according to plan, and the first models of the BMW 3 Series will come off the production lines in autumn 2003.

New IT centre for the Asia, Pacific and Oceania region:

In addition to the sales joint venture, the BMW Group has set up a new IT centre in Kuala Lumpur. Capital expenditure until 2004 will be around euro 5.5 million. The centre is the regional hub for all the company's IT networks in the Asia-Pacific-Oceania area and started operation in the middle of June 2003. The BMW Group is thus supplementing its global IT infrastructure with a third pillar in Asia, in addition to the two existing IT centres in Germany (for the Europe, Middle East and Africa regions) and the USA (for North and South America).

Relocation of parts distribution centre from Singapore to Malaysia

The comprehensive involvement of the BMW Group in Malaysia will be supplemented by the second half of 2004 by the relocation of the parts distribution centre for the Asia-Pacific-Oceania region, which is currently still based in Singapore. Capital expenditure is over euro 8 million in total. The centre will be based in Port of Tanjung Pelepas near Kuala Lumpur. Singapore will continue to be the location for the BMW Group's central sales office for controlling the importer markets in the Asia Pacific region.

(July 15, 2003)