BMW Shifts Production from Germany to U.S.A.

German auto company BMW will reduce its workforce in Germany while increasing production in the United States by 50%.

"This is completely driven by the plunge in the dollar," said Greg Gardner with Oliver Wyman, publisher of the Harbour Report on automotive manufacturing activity. "It is untenable to produce at a much higher cost in Germany."

The euro climbed to record heights Friday, reaching $1.5463 before falling back to $1.5335 in late trading after the Federal Reserve announced it would provide more cash to banks that need it. That means European goods cost more for Americans to buy.

By building the cars in the U.S., BMW can save money on the lower dollar and on wages because its South Carolina workers make less than German workers, Gardner said.

The declining dollar also means BMW and other foreign automakers probably will start buying locally for more of the parts used by their U.S. plants, he said. That shift in production has led to the cuts at home for the Munich-based luxury car maker.

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