Daimler launches GLA SUV in China

Mercedes-Benz has opened its compact car plant at the company’s local production joint venture Beijing Benz Automotive Corporation (BBAC).

An audience of 250 has witnessed the launch of production for the German car maker’s first locally-built compact car: the GLA.

Hubertus Troska, member of the board of management of Daimler AG responsible for China, said “The investment of €720 million demonstrates our confidence into Mercedes-Benz’ prosperous future in China, while boosting our local passenger car production capacities to about 250,000 units by the end 2015 – and we will certainly not stop there.”

Built from scratch in under three years and stretching at present across about 1.5 million square metres, the Beijing-compact car site complements the current Mercedes-Benz’ compact model plants in Rastatt (Germany) and Kecskemet (Hungary) as well as the Valmet Automotive plant in Finland.

The company says it marks the final piece in the jigsaw of Mercedes-Benz’s flexible compact car production network. It also strategically complements BBAC, establishing the plant as Mercedes-Benz’s worldwide only production facility that manufactures front- and rear-wheel-drive passenger cars as well as engines under one roof.

The GLA is, after the GLK, the second SUV that is manufactured in China. It adds to Mercedes-Benz’s SUV family, to which in China at present additionally the M-Class, GL and G-Class belong.

BBAC, a joint venture between Daimler and Chinese partner BAIC Motor, has been producing Mercedes-Benz passenger cars since 2006 and engines since 2013.

Last year, around 150,000 vehicles rolled off production lines at BBAC, accounting for more than one-half of Mercedes-Benz’ total sales volume in China. The 500,000^th locally produced Mercedes-Benz passenger car, an all-new long-wheelbase C-Class model, rolled off the production lines at the end of 2014, marking another milestone in Mercedes-Benz’s increasing local footprint in China.

About half of these vehicles have been manufactured just within two years, highlighting the growth the production site has recently experienced. To prop up this momentum furthermore, both shareholders are jointly investing €4 billion in BBAC through 2015, of which €1 billion alone was used for the localization of compact cars.

The Mercedes-Benz four- and six-cylinder engines produced at BBAC's engine plant are used in locally produced cars from BBAC and vans that are built by Daimler’s local joint venture Fujian Benz Automotive Co., Ltd. (FBAC). The production line was designed with flexibility in mind, with an annual capacity of 250,000 units for the first phase.

About €100 million has been invested into BBAC’s Research & Development site that became fully operational last year. It is the largest of its kind in Daimler’s joint venture worldwide.

Over 160 engineers are responsible for series projects, component and vehicle testing and supporting the production testing –in cross-functional teams, and with focus on locally produced cars.