German luxury carmaker BMW (BMWG.DE) will soon announce plans to build its X7, a large crossover vehicle with three rows of seats, in South Carolina where its plant will undergo an upgrade costing several hundred million dollars, sources said on Friday.
Annual production at the Spartanburg plant, where BMW currently employs more than 7,000 workers, would be increased to 400,000 vehicles, a third more than its current output, the sources said.
BMW in the United States has said only that a "significant economic and product announcement" would be made when it holds an event at its Spartanburg factory on March 28.
The company makes a family of crossovers of various sizes in Spartanburg, which opened in 1994.
Around five years ago, BMW Chief Executive Norbert Reithofer said plans to build an X7 had been dropped because BMW thought large sport utility vehicles were at odds with the carmaker's aim to cut its overall emission footprint.
"The U.S. will stay a market with great potential for us. This is why we are evaluating the possibility of increasing capacity in the U.S.," Reithofer said Wednesday at the company's annual results press conference in Munich.
BMW and Daimler AG's (DAIGn.DE) Mercedes-Benz plan to expand their luxury crossover portfolios to seven vehicles each by 2020, according to European supplier sources, with new entries in multiple sizes and price points, Reuters reported last year.
Volkswagen AG's (VOWG_p.DE) Audi is nipping at their heels with plans for six premium crossovers over the same period.
BMW, Mercedes-Benz and Audi are the global leaders in luxury automobiles.
(Reporting by Bernie Woodall in Detroit and Ed Taylor in Frankfurt; Editing by Sophie Hares)