PRODUCTION NETWORK LAUNCH FOR THE NEW MINI

Three UK plants link for MINI manufacturing. £200 million investment. Capacity
increases to 240,000 units.

Munich/Oxford. The start of series production of the new MINI also signals the
start of a new production network for MINI comprising three BMW Group
manufacturing facilities in the UK. The MINI production triangle in the UK with
its plants at Hams Hall, Oxford and Swindon has received substantial investment
of nearly £200 million to build the new model and to increase MINI production
capacity by 20 percent up to 240,000 units a year in the medium-term. The new
production triangle employs in total 6,350 associates, a number set to increase
by 450 to 6,800 in the medium-term as production nears the maximum capacity of
240,000 MINIs per annum.

The UK Chancellor of the Exchequer, the Rt Hon Gordon Brown MP, was at BMW
Group's Oxford plant for the start of production of the new MINI, along with
the recently appointed Chairman of the Board of Management of BMW AG, Dr
Norbert Reithofer, and guests from UK industry.

During his visit to Plant Oxford Dr Reithofer said: "The MINI has been an
outstanding, international success for the company and our investment will
ensure that we can build on this success in the future. Our new MINI
production triangle has established a lean, efficient and flexible production
network and allows us to continue to offer MINI customers unrivalled
built-to-order flexibility in the small car segment."

Since the start of the series production of MINI in 2001, growing demand
worldwide has constantly surpassed the production capacity of Plant Oxford,
despite continuous production increases. More than 850,000 built-to-order MINIs
have rolled off the assembly line at the Oxford plant to date, 75 per cent of
which having been exported to over 70 markets worldwide.

Plant Hams Hall has received around £30 million to build a new, advanced family
of petrol engines especially for MINI. As output at the Oxford plant reaches
full capacity the total number of BMW and MINI engines being produced at the
engine plant will increase from 180,000 to more than 300,000 units a year in
the medium-term. Based on this production volume at least 250 new jobs will be
created bringing the total employed at Hams Hall to 1,000.
Plant Oxford has received over £100 million to expand production capacity from
200,000 to 240,000 units a year in the medium-term. The plant has invested in
the latest technology throughout the body shell production, paint and final
assembly areas to increase capacity and prepare for the production of the new
MINI. Up to 200 new jobs will be created at the plant as volumes increase
towards the plant's maximum capacity bringing the total workforce to 4,700.
The Swindon Plant has received £60 million for MINI body pressing and
sub-assembly technologies. The facility, which employs 1,100 associates, has
been through an extensive modernisation programme over the past three years and
is now working with the very latest press and seam technology .

In addition to higher production capacities, the integration of the locations
in the MINI production triangle with their efficient logistics networks also
results in increased flexibility. All pressings and body components are
delivered just-in-time from the Swindon plant directly to the body production
facility at the Oxford plant. The engines from the Hams Hall plant are
delivered just-in-sequence to the assembly lines in Oxford.

The sophisticated logistics concept furthermore enables a high degree of
flexibility even after a customer has placed their order. Customer requests for
changes can be taken into account regarding colour, engine type or options up
to seven days before the start of assembly. The underlying "Customer Oriented
Sales and Production Process" (COSP) is unique in this form within the
automotive industry.

To enable the three plants to respond together to changes in demand and to
customer requirements, flexible working and complementary shift patterns have
been implemented across the three plants with up to seven day working and up to
140 hours production time per week.

As well as bringing a significant investment to BMW Group's UK operations, the
UK-based supply industry will also benefit with key, large-scale components,
such as the seats and the cockpit - known as modules - being sourced from
within the UK. Three major suppliers have relocated their operations to be
within one hour of the Oxford plant investing £40 million and creating 750 new
jobs. In total about 60 percent of components delivered to the Oxford plant are
from UK-based suppliers.