BMW could take over Honda’s Swindon facility for UK output boost, says GlobalData

Following today’s news (27 March 2019) that BMW has expressed an interest in buying Honda Swindon factory,

Dave Leggett, Automotive Editor at GlobalData, a leading data and analytics company, offers his view:

“Restructuring in the UK auto sector could play out in unforeseen ways as trading conditions change due to Brexit. BMW will be looking at its pan-European production structure and the UK is its second biggest European market. Making more cars in the UK is one way to hedge against the possibility of higher costs on UK-EU trade and currency fluctuations.

“Sources in the industry say that BMW could be interested in taking over the Swindon plant – which has annual manufacturing capacity of up to 150,000 units, and with additional investment could be doubled on a second line which is currently mothballed.

“BMW already has a well-developed UK manufacturing network through its Mini plant at Oxford and associated engine and body panel works. Adding a high-demand model – such as the compact X1 SUV or 1 Series, which both share the same platform with Mini – could make good business sense. The Honda plant is also well situated from a logistics perspective.

“BMW subcontracts some Mini and X1 production to a VDL plant at Born in the Netherlands, but the plant has now hit capacity limits due to the success of the X1 in the European market. That’s another consideration which could sway this decision. This opportunity to add manufacturing capacity at low-cost in the UK could be viewed as very timely in Munich.”

More Media