A BMW flag is seen next to the BMW headquarter before the company's annual shareholders meeting in Munich
Pretoria - BMW will invest R400 million over the next two years in a new state-of-the-art regional parts-distribution centre and the expansion of its Midrand headquarters to accommodate a purpose-built training centre and offices for its information technology (IT) operations hub.

The R400 million is in addition to the R6 billion that BMW has invested in its plant in Rosslyn, Pretoria, for the production of the next-generation BMW X3.

Tim Abbott, the chief executive of BMW Group South Africa and sub-Saharan Africa, said on Wednesday the regional distribution centre was already under construction at Waterfall in Midrand and would be twice the size of its existing 16000m² distribution centre on its head-office campus.

The distribution centre will be leased from listed real estate capital growth fund Attacq, the developer of Waterfall.

Abbott said about R200 million would be spent on fitting out the distribution centre once it was completed in September this year, and the balance on the training centre and offices.

He said some jobs would be created at the distribution centre, but the head count at the facility would not double, because there would be increased automation.

Abbott said the size of the centre was based on BMW’s anticipated needs until 2035, but these included its South African operations only.

“We have not factored in the distribution of parts into the rest of Africa, which currently come out of Munich,” he said.

Abbott said the relocation of parts warehousing to the new centre in Waterfall next year would open up space at BMW SA’s head-office campus to build a dealer training centre.

Read also: BMW SA opens new charging stations

It would also allow BMW SA to accommodate the expanding needs of its SAP Shared Service Centre and IT operations, which are housed in a rented building in Menlyn.

Abbott said the SAP Shared Service Centre mainly did SAP development for BMW around the world, although it specialised in the United States and Chinese markets.

He said the technology was not getting any simpler, particularly with the advent of autonomous driving, and BMW was looking to recruit more IT specialists.

Abbott said the head count at the SAP Shared Service Centre would increase to 320 by the end of this year, from 200 last year, while the 200 specialist staff at the IT operations hub would grow to about 300 in the same period.

More than 130 global projects have been undertaken by BMW SA’s IT team, which was established in 2014 with 80 people.

Abbott said about 80 percent of the R6 billion investment in the Rosslyn plant had already been spent.

He said the new robots in the body shop were being commissioned; a new paint system process had been introduced; and a combined body stacker had been built, which held 132 painted vehicle bodies that were ready for the assembly line.

Abbott said the remaining 20 percent of the R6 billion investment would be used to fit out the various lines at the plant.

He said commercial production of the next-generation BMW X3 would start next year.

Abbott said the annual production record of the Rosslyn plant was 72000 units.