BMW announces $1bn expansion at South Carolina facility

A BMW employee works on a door assembly. Photograph: Chris Keane/Reuters

BMW is investing $1bn in its plant in South Carolina to build two of its new X-series vehicles at the facility that ushered in a wave of foreign automakers building southern plants.

The German automaker announced Friday it will create another line at the plant, producing the X7, a larger SUV with three rows of seats similar to a Cadillac Escalade. The company will also make the X4, a sportier version of the X3 coupe and plans to build a plug-in hybrid version of its smaller X5 SUV.

The $1bn will be spent through 2016 at the plant in Greer, a town in the foothills of the Blue Ridge Mountains. BWM says it will hire 800 additional workers, bringing total employment at the plant to 8,800 people. The Greer plant will make 450,000 vehicles a year by 2016, becoming the largest of the company's 28 plants around the world.

Almost 300,000 BMWs were made in South Carolina last year, and more than 2.6m vehicles have rolled off the plant's assembly lines in the past two decades.

BMW first started making cars in South Carolina in 1994 after months of courtship from around the US and has become as much of a part of the state's modern cultural landscape as the barbecue. The company said access to interstates motorways, rail lines and the Atlantic Ocean were the state's biggest draws. About 70% of the vehicles made at the Greer plant are exported, most on ships out of the port in Charleston.

Mercedes-Benz followed with a plant in Alabama a year later, and in the past two decades, Nissan, Toyota and Volkswagen have all followed with plants built in rural Southern locations not far from decent-sized cities.

The foreign automakers also benefited from cheaper, non-unionized labor. Earlier this year, workers at the Volkswagen plant near Chattanooga, Tennessee, refused a vote to organize, even with management's blessing.

BMW planned a huge ceremony Friday, with BMW Group Chairman Norbert Reithofer joining governor Nikki Haley and US secretary of commerce Penny Pritzker at the Greer plant.