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Delve deeper into hot topics featured in NGM's February Geographica and Who Knew? with help from Resources. Click on a link, pick up a periodical, browse through a book, and explore!
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It's a big job to build a Mini
Thomas Schmid can be excused for drifting off to sleep at night with visions of auto parts dancing in his head. As the purchasing director for the Mini brand of the BMW Group, he spends his days searching the world for companies to supply the nearly 2,500 parts—from engines to windshield wipers—that finally come together to produce each distinctively stubby car at the company's Oxford, England, assembly plant.
As recently as the early 1990s Schmid might not have needed to look past Europe to find parts. But over the past decade increases in financial pressures, technical requirements, and global vehicle production have forced many automakers to broaden their horizons. "One way to stay competitive is to find low-cost parts, wherever they are," says John Casesa, an auto industry analyst for Merrill Lynch. "It's about car companies needing to find the best parts at the best prices."
As BMW prepared for the 2001 launch of the new Mini—the original car bearing that name had been produced by the British Motor Corporation from 1959 until 2000—Schmid and his colleagues cast a wide net for parts makers. Today their supply chain includes companies based in the Americas, Asia, and Europe. But determining a part's provenance is more complicated than simply identifying its country of origin.
Even for Schmid it's difficult to pin down all the nations ultimately involved in the car's long supply chain. Market prices of commodities may vary according to everything from weather to global politics; for any given Mini production run, parts made from these resources are apt to come from whatever country is producing them best and cheapest at the time.
To reduce costs further, Mini insists that suppliers deliver only enough parts to the Oxford plant to build the 600-some cars moving through the assembly line in a day. For suppliers like the Canadian firm Intier, this means maintaining a factory near Oxford in order to deliver its cockpits (units that include dashboard and steering column) on time.
So what do you call a car built in Britain by a German company using parts from—in one way or another—dozens of other countries? "Since the demand for the Mini continues to outstrip the supply," says John Casesa, "as far as the buying public is concerned, it's called a success."
—Peter Gwin
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