[Jason]

BIMMERPOST NEWS

BMW Group Opens New Vehicle Distribution Center in Galveston, TX.

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The new port facility serves the growing business of BMW Group across Texas, Oklahoma, Louisiana, and Arkansas.

Woodcliff Lake, NJ – April 20, 2016… Today, BMW Group celebrated the official opening of its newest Vehicle Distribution Center at the Port of Galveston. BMW’s Southern Region is growing rapidly and this new facility will better serve the 45 BMW and MINI dealers within four states (Texas, Oklahoma, Louisiana, and Arkansas) that make up a part of the Region. Through the new facility, BMW Group will import and process approximately 32,500 vehicles annually, which represents an import value of nearly $1.3 Billion. The facility is fully staffed with a workforce of nearly 40 BMW Group and Wallenius Wilhelmsen Logistics (WWL) employees and already started receiving shipments of cars for processing this year. Craig Westbrook, Vice President, Customer Experience, BMW of North America, and Stephan Reiff, Vice President, Aftersales, BMW of North America, were in attendance and spoke at the opening.

“For us at BMW, there is nothing more important than the satisfaction and delight of our customers, and this Vehicle Distribution Center will play a critical role in keeping our customers happy,” said Craig Westbrook, Vice President, Customer Experience, BMW of North America. “We are very excited to be here, and be a part of Galveston’s economic vitality.”

Located at 1028 Harborside Drive in Galveston, the fully operational Galveston Vehicle Distribution Center includes more than 44,000 square feet of processing space in two buildings on approximately 20 acres of land. Vehicle inspection, accessory installation, vehicle programming, and vehicle maintenance and storage are performed there.

“Why Galveston? BMW’s Southern Region is growing faster than any other region in the US,” said Stephan Reiff, Vice President, Aftersales, BMW of North America. “Building this facility allows us to continue to deliver the highest quality vehicles while providing faster delivery times to our customers.”

The facility is owned and operated by WWL VSA under BMW Group on-site management. WWL VSA is a leading global provider of auto processing and outbound vehicle logistics services. BMW executives were joined onsite by Ray Fitzgerald, President of Wallenius Wilhelmsen Logistics, Atlantic, and Michael J. Mierzwa, Port Director, Port of Galveston.

“WWL VSA is honored to serve as BMW's choice logistics partner in Galveston, supporting its vehicle finishing needs in preparation for final distribution to dealers in the Gulf region," says Raymond Fitzgerald, President - Atlantic at Wallenius Wilhelmsen Logistics (WWL). "This Galveston port facility marks the 63rd processing facility in WWL's global network – a newly constructed and specially designed state-of-the-art vehicle technical services and storage facility that is fully outfitted and customized to BMW's processes, standards and requirements."

“The Port of Galveston is pleased to welcome BMW Group and its partner Wallenius Wilhelmsen Logistics VSA for the opening of this state of the industry Vehicle Processing Center (VPC),” said Michael Mierzwa, Port of Galveston Port Director. “This VPC will have a substantial economic impact on the region and is in keeping with the Port’s strategic vision to attract new business that will promote jobs and economic prosperity for the community.”

A range of BMW vehicles were on display at the opening event, including the BMW X5. As a sign of the partnership between BMW and the Port of Galveston, BMW will equip the port with an X5 to use for official port business.

[mhjeep]

Now all they need to do is put in another Performance Center outside Austin and offer track days at CoTA.

[dharo1]

Originally Posted by mhjeep

Now all they need to do is put in another Performance Center outside Austin and offer track days at CoTA.

Exactly.

[4corners]

"supporting its vehicle finishing needs in preparation for final distribution"

Does this mean Country specific "port installed" options?

[Destroya]

Is it underwater?

[Flying Ace]

Originally Posted by 4corners

"supporting its vehicle finishing needs in preparation for final distribution"

Does this mean Country specific "port installed" options?

yes, and also to fix damages during shipping...

http://www.m3post.com/forums/showthread.php?t=425763




https://en.wikipedia.org/wiki/BMW_of...,_Inc._v._Gore

[mshab356]

Can someone explain the benefits of opening a distribution center in Texas as opposed to expanding the one(s) on the east coast and just shipping the cars via train/truck as they have been? I'm assuming the variable cost per vehicle of extending shipment via sea is cheaper in the end than via train/truck?

[BEMR]

Originally Posted by mshab356

Can someone explain the benefits of opening a distribution center in Texas as opposed to expanding the one(s) on the east coast and just shipping the cars via train/truck as they have been? I'm assuming the variable cost per vehicle of extending shipment via sea is cheaper in the end than via train/truck?

Relief from the middle usually provides relief to either side of the U.S. this is a good idea and will loosen up the stress from the other 2 ports.

[jphughan]

Originally Posted by mshab356

Can someone explain the benefits of opening a distribution center in Texas as opposed to expanding the one(s) on the east coast and just shipping the cars via train/truck as they have been? I'm assuming the variable cost per vehicle of extending shipment via sea is cheaper in the end than via train/truck?

That, and circumstances may have prevented expanding the existing facilities to the required degree. Maybe there wasn't enough appropriate land available for sale at a reasonable price, or at all. Maybe downstream logistics like trucks and trains wouldn't have been able to handle the projected increased load even if they'd been able to expand their existing facility. Maybe they got a more favorable tax deal from Texas than they would have from NJ. Who knows?

And yes, shipping by boat is much, MUCH cheaper than any other way. It's sheer economy of scale, though it is of course slower. Take a look at this article for an idea of the relative costs: http://www.autoblog.com/2016/03/07/a...locks-closure/.

[M3 Adjuster]

Nice.


Now it's Time to give Circuit of the Americas a call and extend them a lifeline and create BMW Performance Center South.

[M3 Adjuster]

Originally Posted by mhjeep

Now all they need to do is put in another Performance Center outside Austin and offer track days at CoTA.

BMW actually tried to do this back when COTA opened in their first year.


COTA simply wanted too much for their facility and Thermal was a steal of a deal. Maybe they can get back to the table.

[03BeastCharmer]

Originally Posted by M3 Adjuster

BMW actually tried to do this back when COTA opened in their first year.


COTA simply wanted too much for their facility and Thermal was a steal of a deal. Maybe they can get back to the table.

Are COTA financials that bad right now?

[M3 Adjuster]

Originally Posted by 03BeastCharmer

Are COTA financials that bad right now?

In my personal opinion, yes. Tremendous build price and tremendous Bernie Tax made it very expensive to begin with. The track management has experienced ummm exceptionally high turnover , but not surprising when most of the people at the top don't have a background in Motorsports. Go check out their website ..

Factor in the loss of a serious source of money from the city of Austin /state (alleviated by a favorable reduction in the tax appraisal ) and major issues like flooding they've had a rough start ..

[Chez]

Nice. Looking forward to the tour of this facility on May 6th!

[Flying Ace]

Originally Posted by mshab356

Can someone explain the benefits of opening a distribution center in Texas as opposed to expanding the one(s) on the east coast and just shipping the cars via train/truck as they have been? I'm assuming the variable cost per vehicle of extending shipment via sea is cheaper in the end than via train/truck?

Originally Posted by BEMR

Relief from the middle usually provides relief to either side of the U.S. this is a good idea and will loosen up the stress from the other 2 ports.

Originally Posted by jphughan

That, and circumstances may have prevented expanding the existing facilities to the required degree. Maybe there wasn't enough appropriate land available for sale at a reasonable price, or at all. Maybe downstream logistics like trucks and trains wouldn't have been able to handle the projected increased load even if they'd been able to expand their existing facility. Maybe they got a more favorable tax deal from Texas than they would have from NJ. Who knows?

And yes, shipping by boat is much, MUCH cheaper than any other way. It's sheer economy of scale, though it is of course slower. Take a look at this article for an idea of the relative costs: http://www.autoblog.com/2016/03/07/a...locks-closure/.

good points. I have to add, to answer the question requires a deep dive into BMWNA's logistics infrastructure.

Somewhere, they computed the delievered cost per vehicle or cost per mile or whatever the their major metrics are on costs they want to minimize.

Then there are variables such as costs of shipping operations as it relates, distance travelled by ship vs train vs truck, and also costs related to port unloading fees. Remember, commercial ports are competing against each other for container traffic, so depending on volume, they might cut you a discount.

I suspect there are some potential city/state tax incentives to unloaded at certain ports around the country as well. So you have account for those incentives.

Then there are labor costs of each location to set up BMW inspection offices as assoicated HR costs. (ahem, maybe that's why they're not making their port of entry Long Beach/Oakland/Bermerton)

Finally, you also need to get an understanding of the weighted final mile delivery distances to each dealership from each prospective port-of-entries (weighted against total volume).

So you can see, it's a complex logistic puzzle, that's why the leads at any company who has to solve delivery logistics are paid well over $200k salary to figure all this out and minimize cost.

Also, there are companies who got really good at computing these algorithms taking into account the variables specifically related to their business. Amazon, Fedex, UPS comes to mind. For these companies, their propreitary logtistics algorithms or fulfillment services are worth more than the tangible assets of the company itself. I read somewhere that the fullfillment and logistics algorithm and infrastructure of Amazon itself is worth a good 50% to 60% of the entire net value of what Amazon's business is worth. Further, UPS, Amazon and Fedex are now in the business of selling their algorithm to less sophisticated businesses to deliver their products to customers (fulfillment warehouses by Amazon) or the entire logistics advisory services you can purchase from UPS/Fedex.

[Chez]

Originally Posted by mshab356

Can someone explain the benefits of opening a distribution center in Texas as opposed to expanding the one(s) on the east coast and just shipping the cars via train/truck as they have been?

So my future cars get here quicker.

[08njSTEP]

The ships circle the globe. Pick up cars in Munich, drop in NJ. Pick up cars in SC deliver to CA. And so on. So the ships are already going past TX now. Drop some in TX might reduce fuel cost or canal tax.

[r3dbimmer89]

There's probably a rail line connected to Mexico so once that plant is up and running it will import Mexican made 3ers to the facility to be processed.

[P1]

Originally Posted by mhjeep

Now all they need to do is put in another Performance Center outside Austin and offer track days at CoTA.

Naah, put that somewhere else. Like Dallas or Houston. Austin is full.

[mhjeep]

I'd definitely be up for Dallas. I just want to drive on CoTA.

[SakhirM4]

Originally Posted by mhjeep

I'd definitely be up for Dallas. I just want to drive on CoTA.

Then sign up for Texas Trifecta in June

[dsad1]

Originally Posted by Chez

So my future cars get here quicker.

I am curious if cars would get here faster. It seems like it would take longer for the ship to get to the gulf, instead of trucking the cars from the east coast.