BMW CASE: Globalization of Manufacturing OperationsINTRODUCTIONThis case focuses on the dilemma that the president of BMW Manufacturing Corp., Al Kinzer, faced in 1995 in relation to the new BMW plant of Spartanburg, South Carolina and dramatically increased demand in the US market for the Z3 model. To study the BMW case, the basic information and role of the new Spartanburg plant will be described at the beginning. Secondly, the 3 alternative options will be analyzed and compared accordingly to determine a suitable conclusion. Finally, the recommendation will be presented with various considerations. BACKGROUND BMW BMW was founded in 1913 by Karl Rapp as an aircraft engine design shop. After World War I it began building motorcycles and then expanded into the automotive industry in the 1930s. After World War II the company suffered again, but later survived when Herbert Quandt took control in 1959. The company grew rapidly and reached a market value of nine billion US dollars in 1979; however, it was still small compared to the large US automaker. Profits continued to grow rapidly. In 1995 BMW had thirty-four wholly owned subsidiaries, fourteen in Germany and twenty worldwide. They also discovered that the US market would be the largest and fastest growing market for BMW. BMW quickly realized that many threats affected its market share in the United States. Japanese automakers began building plants in the United States to meet increased U.S. demand at a lower cost. than import their cars. BMW's American export situation was further worsened by the appreciation of the German mark and also by the increase in German labor costs. As a result, the decision was made in 1991 to build... middle of paper... system. It will definitely take time to set up a new factory and make production run smoothly with quality assurance. How to shorten the learning curve for these jobs would be the first priority for BMW to think about. Investing more in building a facility would be a long-term consideration. For the short term, we suggest that BMW focus on producing the Z3 in Spartanburg and ship the 318 back to Germany for production. The 318 has worldwide demand, while the trend in the US prioritizes the Z3. The 318 series or the other 3 series have high potential to gain market share in the future, and eventually, production will be moved to a low-cost production line to remain competitive. With international manufacturing, having the flexible manufacturing capabilities to produce a broader group of products will play a crucial role in the future of the automotive industry.