BMW to Invest $750 Million Euros in Megacity Electric Vehicle for Cities

Bayerische Motoren Werke AG, the world’s largest maker of luxury vehicles, said it will invest 530 million euros ($751 million) to set up production of its Megacity electric-powered city car.

The investments, including a new carbon-fiber factory in the U.S. and a 400 million-euro expansion of its Leipzig, Germany, auto plant, will create more than 1,000 jobs, the Munich-based company said today in a statement.

“With this vehicle, we are revolutionizing automobile manufacturing,” Chief Executive Officer Norbert Reithofer said today at an event at the eastern German plant.

The Leipzig factory, which assembles BMW’s 1-Series compact car and X1 sport-utility vehicle, builds as many as 730 vehicles daily. BMW will create 800 jobs at the eastern German site as it adds production of the Megacity model designed for urban driving. The car, BMW’s first battery-powered auto, will be sold under a new sub-brand when it reaches showrooms in 2013.

Reithofer is developing the Megacity to help meet tighter environmental regulations and expand the product lineup to boost sales to 2 million vehicles by 2020 from 1.4 million this year. Passengers in the four-seat car will be protected by a carbon- fiber safety cell, similar to a Formula 1 race car.

BMW is using carbon fiber, which is 50 percent lighter than steel, to reduce weight and enable a smaller, less costly battery to power the vehicle. BMW and SGL Carbon SE, the world’s biggest manufacturer of carbon and graphite products, are building a $100 million factory in Moses Lake, Washington, to make the material for the Megacity models.

To contact the reporter on this story: Chris Reiter in Leipzig via creiter2@bloomberg.net.

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net.

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