BMW, Brilliance to Build New Car Plant in China

FRANKFURT -(Dow Jones)- German luxury carmaker BMW AG (BMW.XE) said Thursday it will build a second plant in China with joint-venture partner Brilliance Automotive Holdings Ltd. (1114.HK) for EUR560 million, boosting local production capacity to 100,000 cars per year.

"Our plant has reached its capacity limit - so we are now taking the next step. The decision to build a second plant demonstrates that we are investing in our future in China and that we intend to participate in the strong growth in the Chinese market," said BMW Chief Financial Officer Friedrich Eichiner in a statement.

He added that the move is also "an important strategic step towards reducing our exposure to currency fluctuations".

Construction work at the site in Shenyang is due to start 2010, with the start of production planned for early 2012.

-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512; christoph.rauwald@dowjones.com

(END) Dow Jones Newswires

11-12-09 0438ET