Bmw: Globalizing Manufacturing Operations

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As we can see, with the new plant in the US, BMW realized that it had to configure its global supplier network in order to take advantage of NAFTA's tariff exemption and lower down the costs. Moreover, instead of importing cars from Germany, local production could hedge the exchange rate fluctuation. Thus, Spartanburg would be BMW global supply chain manufacturing base. It should be agile in local supply chain management to enhance local and cost effective souring to keep a competitive price. It also should be adaptable for US market expanding and still aligns with the BMW's quality commitment. Additionally, it was responsible for initiating the BMW's production innovation such as designing new model for U.S. market and creating new culture in BMW organization. There are 4 major factors driving BMW's globalization: Global market forces = The pressure created by Japanese or foreign competitor pushes BMW to be more competitive in price in the U.S. market, and further to be more competitive in worldwide later. Surely, the U.S. is the largest market but not the only market. If there were any opportunities created by other foreign markets, then the U.S. facility would be a successful model to help BMW entering other countries. Technological forces = Since the U.S. has above averaged vehicle industry background, hiring skilled labor is not a difficult thing. The transfer of engineers would be held between Germany and the U.S. Furthermore, the management knowledge, engineering innovation, technical information would be shared closely. All these filled up the gap between two different cultures. Cost Forces = As we know, the U.S. labor has relatively lower wage rate than German has. Cheaper skilled labor largely attracted BMW to invest. Additionally, to build a new facility in the U.S. would be less cost than building in Germany. Political and economic forces

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