BMW will meet its output targets for 2022 despite port congestion in China, closures in Ukraine, and ongoing supply chain issues, reported Milan Nedeljkovic, production chief for BMW AG.

Milan Nedeljkovic reported in an interview that the world’s largest luxury-car maker will switch to alternative Chinese ports and use other modes of transportation to deal with disruptions caused by China’s COVID-zero policy. He stressed BMW expects to maintain output at roughly the same level as last year.

“We can still compensate lost volume and component scarcity,” Nedeljkovic said, saying he was confident to deliver on the output goal set at the beginning of the year. 

BMW’s production network suffered impacts due to supply chain challenges during the first quarter. However, the Munich-based automaker fared better than its competitors. The carmaker’s deliveries declined 7.3% during the first three months of the year, less than half the rate of Mercedes Benz AG and Volkswagen AG’s premium brand, Audi.   

The semiconductor shortage remains BMW’s most pressing issue, Nedeljkovic said, noting he also must prepare BMW’s production network for gas shortages in case Germany is forced into rationing.  

“Short-term, it is very difficult for the automotive industry and suppliers to do without gas,” he said. Automakers use gas in their paint shops and to manufacture certain components.

BMW is looking into hydrogen for production processes at its plant in Leipzig. The company’s Spartanburg plant in the U.S. uses bio methane for heating. 

Its new assembly facility in Debrecen, Hungary, won’t use any fossil fuel when it goes into operation in 2025. 


Originally posted on Auto Dealer Today

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