Forever Changed

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On June 23, 1992, BMW officials joined with state and local leaders to announce the company’s plan to build its first manufacturing plant outside of Germany. From left: Karl Gerlinger, president and CEO of BMW North America; Helmut Panke, director of corporate planning for BMW Group; S.C. Gov. Carroll Campbell; Bernd Pischetsrieder, member of the board responsible for manufacturing for BMW Group; S.C. State Sen. J. Verne Smith, R-Greer; and John Warren, chairman of the S.C. Development Board.

Carl Flesher Jr. recalls the moment he realized BMW changed South Carolina.

Flesher was the first employee hired for the automaker’s first manufacturing plant outside its native Germany announced on June 23, 1992.

Later that year, he was riding in a caravan with company, state, and local officials whose terminus was a groundbreaking ceremony on what was then a 1,150-acre greenfield site in western Spartanburg County.

“I was overwhelmed and humbled by the turnout of people along the streets and roads en route to the groundbreaking,” said Flesher, who retired as the plant’s vice president of corporate communications in 2005. “Cars were lined up. Schools and businesses closed. People were waving American and German flags. I realized then what the expectations were and the responsibility on my shoulders. I asked a very nice city councilwoman from Spartanburg what she thought about it all. She turned to me and said, ‘Carl, if we can build BMWs, we can do anything.’”

S.C. Gov. Carroll Campbell and BMW Chairman Eberhard von Kuenheim break ground at the future home of BMW’s Spartanburg County facility. Photo provided.

BMW’s announcement was a big win for a state that was literally in the midst of seeing its textile manufacturing industry evaporate during the late 1980s and early ’90s.

About 60,000 textile jobs were eventually lost to countries like China, Mexico, and India. Mills that supplied South Carolina communities with economic lifeblood, pride, culture, and other benefits, shuttered one by one.

After hearing about BMW’s interest in building cars in North America in the late 1980s, then-Gov. Carroll Campbell cold-called the automaker, which considered about 250 sites worldwide for the plant.

BMW had narrowed its choices to Spartanburg County and Omaha, Neb. Officials in both states launched massive efforts to court the automaker.

Campbell and other legislators negotiated an incentives package worth about $150 million. Critics argued that the state was giving away too much.

The Palmetto State eventually won out.

The facility, known now as BMW Manufacturing Co., was announced as a $600 million investment that promised to create almost 2,000 jobs.

BMW initially hoped to attract nine suppliers to South Carolina.

“BMW changed the psychology of the state of South Carolina,” said S.C. Secretary of Commerce Bobby Hitt, who was part of the team that put together incentives for the automaker and was later hired as employee No. 34 at the plant. “That was a time of great deflation in the state. Hats off to Gov. Campbell. He was singularly focused on recruiting companies. … Here we are now and we have an automotive sector that supports about 66,000 jobs.”

An economic development study by the University of South Carolina’s Darla Moore School of Business released in 2014 said that nearly 31,000 jobs in the state were supported by the production of BMW vehicles.

BMW’s total capital investment in the Spartanburg plant, which is the production center of its X3, X4, X5, and X6, Sports Activity Vehicles, is nearly $8 billion to date.

The facility employs almost 9,000 people, a majority of who are from South Carolina.

In terms of production volume, is the automaker’s largest plant in the world, having assembled a record 411,000 vehicles in 2016. The plant is on pace to break that record in 2017.

BMW Manufacturing Co. is nearing the completion of another $1 billion expansion of the plant to expand production and add capacity for a new model—the X7, which should hit dealerships in late 2018.

The plant encompasses more than 5 million square feet and its average daily production has grown to 1,400 vehicles. It is poised to produce its 4 millionth vehicle this year.

In February, the plant announced it remained the nation’s largest automotive exporter in 2016.

The automaker exported 287,700 X models during the year. About 86 percent were exported through the Port of Charleston.

The plant’s exports were valued at $9.53 billion, according to the U.S. Department of Commerce, confirming it as the country’s leading car exporter in terms of value for a third consecutive year.

The first car was completed at BMW’s Spartanburg County plant on Sept. 8, 1994. Photo provided.

BMW Manufacturing Co. has also garnered several J.D. Power quality awards and produces about half of its own energy onsite via the combustion of methane gas siphoned from the Palmetto Landfill.

Hitt said South Carolina today has 400 automotive suppliers. BMW’s success has led to other announcements, including Boeing, Daimler AG, Volvo, Toray, and others.

“BMW raised the flags of Spartanburg County and South Carolina for all of the world to see,” said Spartanburg County Councilman David Britt, who was first elected in 1991 and remembers BMW’s announcement. “Their decision was transformative. All you have to do is ask yourself, ‘Where would we be without BMW?’ I think the answer is pretty clear.”

In 1992, prior to BMW’s original announcement, Spartanburg County boasted only one international manufacturer outside of the textile industry: Greenville-based Michelin North America, Britt said. He said the county lost 25,000 jobs to the decline of textiles.

Britt said Michelin’s success in the Upstate helped prove to BMW that the region and state could supply many of the ingredients that would help the plant succeed, including a skilled workforce and a strong technical college system.

He said 125 international companies, including 38 German firms, have set up operations in Spartanburg since BMW’s announcement. And since 1992, the county has netted $16 billion in investment and 45,000 jobs.

“Ask yourself, who else could come in and have that kind of impact?” Britt said. “Lock, stock, and barrel, I’d take BMW over any other company in the world. They are the gift that keeps on giving; they always under-promise and over-deliver. We went from having a loser’s limp to a winner’s gait overnight.”

Britt credited BMW for setting the bar higher for corporate citizenship in the community, and for raising the bar for education.

“It’s like oxygen,” he said. “You can’t put it into words, but you know when you don’t have it. BMW is like oxygen for South Carolina and Spartanburg County.”

Hitt said state residents have played a large role in BMW’s success.

“It’s not a talking point; it’s a reality,” he said. “Sure it’s a great company that offers great benefits. For me, having been inside the tent for so long, I don’t know of anything else — other than what I’m doing now — I could’ve done that would’ve been more satisfying.”

Hitt said BMW helped lay the “groundwork” for and continued to shape state and local efforts to create economic development and opportunities.

One such effort was the creation of Clemson University’s International Center for Automotive Research (ICAR) in Greenville in 2003.

According to ICAR, about 95 percent of its graduates are gainfully employed in the automotive industry; its students represent 17 countries; 26 percent of its alumni are employed in South Carolina; it has awarded 183 Master of Science and PhD degrees; and has four endowed chairs in four key research areas.

Hitt said more than 18,000 people across the state have gone through apprenticeships programs offered by companies in partnership with the Apprenticeship Carolina, a division of the S.C. Technical College System.

BMW has been a driving force behind South Carolina’s push to create a pipeline of talent.

“We’ve built the pipeline,” Hitt said. “We need it because we are now in this period of change at BMW where we don’t have the luxury of starting from scratch. [Employees] need to be able to hit the ground running.”

In 2016, the state’s General Assembly approved a bill creating the S.C. Coordinating Council for Workforce Development.

According to the bill, the council will “engage in discussions, collaboration, and information sharing concerning the state’s ability to prepare and train workers to meet current and future workforce needs.”

“We did none of this before [BMW],” Hitt said.

He said the state has to continue build on these efforts to support BMW and other manufacturing operations in the state.

Another vital piece of the puzzle, Hitt said, is providing logistic systems that enable companies like BMW, which ships 70 percent of the cars it makes to 140 markets worldwide, to get their parts and products to where they need to be.

On Wednesday, June 21, the S.C. Ports Authority Board adopted a 2018 fiscal year financial plan that includes $262.3 million in capital expenditures, the largest capital plan in the authority’s history.

The plan, which is a $14.3 million increase compared with 2017, provides funding for upgrades geared to help SCPA meet volume increases expected at the Port of Charleston and inland port in Spartanburg County.

In May, SCPA reported record container volume of 182,452 twenty-foot equivalent units (TEUs). For the fiscal year that started in July 2016, container volume was up 9.4 percent to 1.96 million.

SCPA reported the inland port near Greer handled 12,702 rail moves in May, a 47 percent increase compared with the same month of 2016. For the fiscal year, the inland port had 108,701 rail lifts.

“We need a very sophisticated system,” Hitt said. “We’re in constant communications with our companies to make sure we’re meeting their logistics needs and staying ahead of the curve.”

With all of the changes in the state brought on by BMW’s announcement 25 years ago, there are still a few people who remember the plant’s early days that preceded the its opening in 1994.

Sky Foster, manager of corporate communications for BMW Manufacturing Co., was hired as associate No. 5 for the plant in March 1993.

Foster started working in human resources as the manager of recruiting. Her job was to hire the plant’s workforce, which she said was simple, but very challenging.

“In the beginning, we talked about investing in technologies,” she said. “My focus was investing in the people because I knew it was the people who would make the difference.”

Foster said she had to hire 100 people by January 1994.

The plant’s original startup crew consisted of about 50 people, who first began working out of the Montgomery Building in downtown Spartanburg.

Foster said she didn’t “comprehend” the interest people in the area had in BMW until she walked into a room and saw resumes stacked from the floor to the ceiling.

“In that day, we didn’t have computers to scan each resume so we had to do this by hand,” she said. “By the time we had gone through all the resumes, the interest was 160,000 applications for just 100 jobs. That told me how eager people were to be a part of this organization. My focus was to find the best so that we could become the best company in South Carolina. That was the focus for many months and continues to be the focus today.”

Foster drove the first vehicle produced at the plant — a white 318i — onto a stage at during the facility’s opening ceremony on Nov. 15, 1994.

Fireworks marked the grand opening of BMW’s Spartanburg plant.

“Certainly the X models we have produced are very popular and part of the reason for our success,” Foster said. “Just like our engines are the heart of our BMWs, our associates are the heart of this plant. They are the reason that Plant Spartanburg has been successful. Their commitment and dedication to building premium quality BMWs for our customers is second to none.”

Brett Suits of Spartanburg was hired as employee No. 50 at the plant. Today he serves as a manager of the facility’s painted body quality manager.

Suits, a mechanical engineer, left a career at Hoechst Celanese in Spartanburg, now the Auriga Polymers plant, to work for the automaker.

His wife, Allison, was a German teacher who was tutored the plant’s first vice president of human resources. He was introduced to the official and later offered a job at the plant.

“I believed God wanted me to be here,” said Suits, 56. “I always had a desire to be a part of building something from the ground up.”

Suits said he remembers visiting the plant site in the early days when the employees were training at a nearby facility off Brockman McClimon Road.

“I remember thinking, ‘We’ll never be able to fill this up,’” he said. “Now we’re almost out of room.”

Suits remembered that Honda executives were hired and brought in to lead the plant’s management team through the start-up process.

“We didn’t have a clue,” he said. “There was a lot of anticipation. When the first cars came down the line, there was a lot of pride there.”

Suits and his family moved to Germany in 1995, while he worked on the launch of the X5. They returned to Spartanburg in July 1998.

Hitt and Suits said they remembered the introduction of the new Z3 Roadster, or “Zed 3” as it was known in Germany.

The model was featured prominently in the 1995 James Bond film “Goldeneye.”

Knudt Flor, the plant’s new president and CEO, served as a mock auditor, making sure the car was up to snuff.

“In my mind that was the most important car we ever built,” Hitt said. “It was our first exclusive.”

Hitt said in 1996 then-BMW Chairman Bernd Pischetsrieder visited the plant for the Z3 launch. Employees gathered in a cafeteria to hear Pischetsrieder speak.

“He got up to praise everybody and said ‘Now, it’s only going to get harder from here. This is just the starting line,’” Hitt said. “You could’ve heard a pin drop in that room. The message was that the ‘world is watching.’”

Suits said he too felt the mentality of the plant shift throughout the years.

“I struggled for a few years because this place is constant change,” he said. “I’ve learned that change is good because it means continuous improvement and maturation. When we started out we wanted to be ‘as good as.’ We achieved that and then it became ‘be better than.’ Now it’s the ‘best of.’ It has taken 25 years to get there. We have to learn how to achieve excellence. It’s the pursuit of perfection. Everything we do has to be perfect.”

Suits said plant leaders are focused on handing over the keys to a new generation of employees, like his son Jacob, 25, who graduated with a mechanical engineering degree from Clemson University and was hired as a metrology systems planner at the plant.

“This generation coming up now will lead this plant,” the elder Suits said. “They are so smart, so talented. I have to make sure I’m handing that over; passing on what’s important. I feel good about the community and BMW. I think we have a bright future.”

“There is definitely a sense of pride knowing the impact that the first employees here had on the success and culture of this company,” Jacob Suits said. “To know that my dad was a part of it is very special.”

 

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