BMW Finds Mexico in South Carolina

ROBERT RENO

June 28, 1992|By ROBERT RENO

At the very time indigenous U.S. auto-makers are transferring a rather alarming portion of their productive capacity to Mexico, the Germans are relocating a chunk of theirs to South Carolina.

The Bavarian Motor Works AG looked and looked and finally found the attractions of the Palmetto State more enticing even than the hordes of cheap labor and environmental laxity to be found in the booming, teeming vastness of Mexico.

BMW chairman Eberhard von Kuenheim, and for heaven's sake don't forget the "von," tactful aristocrat that he is, did not allude to the low-paid help yesterday but suggested that it was South Carolina's -- South Carolina's? -- incomparable infrastructure that cinched the deal for Spartanburg over Omaha as well as various sites around the world.

But make no mistake about it: The Bavarians, long famous for their beer halls, buoyant nature, lunatic monarchs and radiant scenery, are also famous for knowing a bargain. They can readily spot a place where workers, unlike their own, will not demand premium wages, union membership and interminable vacations.

Von Kuenheim couldn't very well have come out and said he picked South Carolina because it ranks third among the 50 states in the infant mortality rate, fourth in the percentage of people getting food stamps, 49th in union membership as a percentage of its work force and 42nd in disposable per capita income.

He couldn't say that, when you threw in the huge subsidies voted by its legislature, South Carolina was to the Germans the state that bore the closest resemblance to Mexico. That would have made it seem like the crafty Germans had concluded that these South Carolinians were so desperate for steady work and economic development that they'd slave their butts off for peanuts. (Herr Von Kuenheim should have seen the place before 1865.)

Anyway, being in South Carolina puts BMW close to the epicenter of the highest concentration of ambitious surgeons, status-conscious executives, affluent stockbrokers and success-driven trial lawyers in the world -- those fortunate American trendsetters, lords of the 1980s, who form the profit-core of its relatively small but immensely lucrative market.

And it better positions them to head off the hard-charging Japanese, who, having conquered the high-volume market, are now eating the toes off what had been the German dominance of the overpriced super upscale market, with its to-die-for per unit profit margins.

And if this induces the Japanese to build Lexus and Infiniti assembly plants in the United States, so much the better.

There is something symmetrical and encouraging about this trend. We can even imagine, given the steady decline in real blue collar wages in the United States under Ronald Reagan and George Bush, whole other foreign manufacturing industries positioning themselves to take on the U.S. market -- still the richest in the world -- from within.

It is, of course, taking a chance for BMW to assume that anyone as acutely status-crazed as its particular consumers will continue to buy cars they know are not put together with German, but with South Carolinian, thoroughness and precision.

Robert Reno is a columnist for Newsday. Barry Rascovar is on vacation; his column will return here next Sunday.

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