BMW is to build a large plant in Russia’s Kaliningrad enclave, near the Polish border, the news has been confirmed by a BMW spokesperson, according to various news outlets.
The estimated cost of the factory is thought to be at least €50 million, and the plant will be a fully-fledged production site rather than an CKD or SKD assembly facility, and is thought to have been chosen to benefit from Kaliningrad’s established logistics channels.
BMW has been assembling its 3, 5 and 7 series models as well as X1, X3, X4, X5 and X6 vehicles in Kaliningrad since 1999.
BMW said the regional government in Kaliningrad had created “a very favourable environment for investments”. The special economic zone (SEZ) in the Kaliningrad area allows those setting up business there to apply for subsidies from the state budget “which are comparable to the fees paid when importing automotive components into Russia”, the BMW spokesman said; he did not confirm whether the plant would be built in the SEZ.
The German carmaker had been looking at three locations: the Moscow region, St. Petersburg and Kaliningrad; the carmaker registered its BMW-Rusland Automotiv company in Kaliningrad in January 2018.