New BMW Group plant to be built in the region Leipzig/Halle

BMW market and product offensive requires additional capacity. 'BMW Formula
for Work' will increase productivity

Munich, Germany. July 18, 2001. The BMW Group took the decision to build the
new BMW plant in the region Leipzig/Halle. The location is within sight of the
Leipzig Trade Fair. The area is about 200 hectares in size and has first-class
connections to the motorway, the airport and the railway system.

Approximately 10,000 new jobs will be created at the new location in the medium
term - about 5,500 thereof at the new plant of the BMW Group and approximately
the same number again in the surrounding area. Production will start in the
year 2005. Following a ramp-up phase, a capacity of 650 units a day will be
reached. It is planned to build the BMW 3 Series at the new plant, which will
involve an investment of roughly Euro 1 billion.

The new plant is needed because the BMW Group has launched a market and product
offensive. In this connection, plans include the BMW 1 series, the expansion of
the BMW X-family and the BMW 6 series. The construction of a new factory is
also essential because of the continued positive development in sales of BMW
automobiles.

In all, more than 250 locations proposed in both Germany and abroad had to be
examined. The last five locations given close consideration - Augsburg,
Leipzig/Halle, Schwerin, Arras in France and Kolin in the Czech Republic - all
fulfilled all the necessary criteria for building the new plant.

The most important criteria to be considered were as follows:

1. The economic viability and flexibility.
2. The features and the location of the future plant area.
3. The availability of qualified manpower.
4. The use of existing structures in terms of plants, suppliers and logistics.
5. The infrastructure for transport, supplies and waste management.
6. The connection to the sales and distribution network.
7. The process of implementation.

Considering the figures alone - above all the level of wages at the plant,
foreign locations outside of Germany offered certain advantages.

Taking into account the need for flexibility - and here this means flexibility
of job structures and the integration of the plant into the BMW Plant Network,
process management extending from planning all the way to the start of full
production, as well as designated grants, mere cost considerations had to be
put into a different perspective.

In the assessment in terms of the corporate interests, therefore, the decision
was ultimately taken in favour of Leipzig/Halle This is the location with the
best perspectives for the purposes of the BMW Group.

Integration into the plant network of the BMW Group

The integration of the new plant within the existing BMW Plant Network is very
important. The essential point is to ensure that all the plants are able to
operate at the same consistent and high level of capacity. This guarantees
maximum efficiency and profitability, as it has been have proven time and again
at the existing locations.

Another factor closely interacting with this consideration is the integration
of the suppliers. In Leipzig/Halle it is possible to largely resort to the
existing supplier structure throughout the south of Germany.

In all, this will allow a rapid ramp-up of production and optimum calculation
of the entire ramp-up process to achieve a highly competitive productivity
level.

'BMW's Formula for Work'

Looking at various entrepreneurial and business-related aspects, not only the
cost of purchasing and developing the site had to be taken into consideration,
but also the productivity and, accordingly, the cost of labour and working
times. In this context the "BMW's Formula for Work" was applied in cooperating
with the representatives of employees. So it was possible to significantly
enhance the degree of flexibility.

The main point, once again, is to further optimise the job structures and work
organisation. This also means disconnecting plant operation periods from
personal working hours and vice versa In the final result the useful time-frame
will be increased.

The "BMW's Formula for Work" was agreed on a competitive level of remuneration
appropriate at the new location and based on the state-wide collective wage
agreement. Clearly, the international human resources principles of the BMW
Group also apply to the new location.

* * *

Immediately after the decision in favour of Leipzig/Halle as the new location,
the BMW Group will be opening an office in Leipzig. The address and opening
hours will be announced in a press release in the next few days.

An Internet site has already been opened for the new location:
www.BMW-Werk-Leipzig.de.
An e-mail address has been set up for job applications at:
Leipzig.Personalmarketing@bmw.de.
Further information is also available from the BMW Call Centre:
Tel: 0049 1805 225656.

If you have any questions, please contact:

Corporate Communications

Hubert Bergmann, Business and Finance Communication, Corporate Communication
Telephone: (+49 89) 382-20775, fax: (+49 89) 382-24418

Peik von Bestenbostel, Corporate Communication
Telephone: (+49 89) 382-22332, fax: (+49 89) 382-24418

Internet: www.press.bmwgroup.com
e-mail: presse@bmw.de