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BMW slows US production due to transmission supply

* BMW has flown in transmissions to meet increased demand

* Ash-related flight restrictions tightening supplies

* BMW taking ‘extraordinary’ measures to maintain supplies

DETROIT, April 19 (Reuters) - BMW AG BMWG.DE has slowed production at its U.S. plant in South Carolina because flight restrictions in Europe due to ash from the volcanic eruption in Iceland have hampered deliveries of transmissions, a company spokesman said on Monday.

The plant in Spartanburg is the sole producer of BMW’s X5 and X6 vehicles worldwide, building about 600 per day. About 70 percent of the vehicles are exported from the United States.

Due to recent strong demand, lead times in Europe on transmissions have shortened and BMW over the last few weeks has had them flown to the United States instead of shipped by boat to keep up schedules, said Bobby Hitt, spokesman for BMW Manufacturing Co in Spartanburg.

On Monday, BMW told workers it would slow production while maintaining its normal shift schedule and take “extraordinary measures” to ship transmissions to southern Europe for flights to the U.S. to maintain production, Hitt said.

Hitt did not say how much daily production would be trimmed or how long that could last before further cuts were needed. BMW normally runs two 10-hour shifts at the plant from Monday through Thursday and one shift on Friday.

In terms of value, about 65 percent of the parts assembled at the Spartanburg plant are sourced from North America, with the other 35 percent of the value coming mainly from engines and transmissions shipped from Europe by boat, Hitt said.

BMW uses air freight as a backup occasionally to maintain production. (Reporting by David Bailey; editing by Carol Bishopric)

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