The Return of a Legend

Stuttgart, October 26, 2016

Borgward to build manufacturing facility in Bremen

Stuttgart/Bremen - The automobile manufacturer Borgward will be returning to Bremen and build a production facility there. "Through our return to Bremen we are linking the past with the future," said Ulrich Walker, CEO of Borgward Group AG, in Bremen on Wednesday. "We are continuing to write the history of Borgward." Bremen was the former home of Borgward, and the German automotive company produced around 1.2 million Borgward, Lloyd, and Goliath brand vehicles here from the 1920s until well into Germany's "economic miracle" era. Construction of the new manufacturing facility is scheduled to begin in early 2017. Production will be launched at the plant a year later, in 2018.

In addition to objective arguments such as the location's good logistics connection to an international port, the ready availability of skilled workers, and the region's outstanding supplier industry, emotions also played a major role in Borgward's decision to come to Bremen. "By taking this step, we are demonstrating our commitment to Germany as an industrial location and to our own heritage. Naturally, our return here is also of symbolic significance, as today marks the beginning of a successful cooperation between the city, the state, and Borgward," Walker added. Christian Borgward, the grandson of company founder Carl F.W. Borgward and Chairman of the Supervisory Board of Borgward Group AG, is as enthusiastic as Walker about the decision to return to Bremen. More than ten years ago, he founded an initiative for the revival of the brand - an objective that he is now finally seeing fulfilled. "The unveiling of the revived Borgward brand in Geneva last year, the presentation of the premiere model, the BX7, at IAA 2015, the exhibition of the BX5 and BX6 models in Geneva this spring, and now the decision to create a production facility in the province of Bremen. It is indescribable how impressively dynamic my grandfather's work is now being continued!"

The exact location of the production facility will be decided sometime in the weeks ahead. According to Walker, Borgward is currently holding in-depth talks about the final location with potential production partners, property owners, and the State of Bremen.

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Bremen's Senator for Economic Affairs, Martin Günthner had this to say about the decision: "A warm welcome to Bremen. We are very pleased about the decision of Borgward. With our competence in the automotive sector and logistics we had good arguments to convince Borgward. The fact that the history of Borgward will be updated where it once started makes it for all of us to a special event."

Between 50 and 100 jobs will be created in Bremen during the initial phase. Borgward plans to create an SKD manufacturing facility with a production capacity of up to 10,000 vehicles per year. In the first step, the company will build an assembly hall with around 10,000 square meters of floor space. Next to it will be a similarly large outdoor area.

Says Ulrich Walker: "Production will be designed from the ground up to be flexible and organized in such a way that we can adjust - and thus increase - production output and the number of models to the demand at any time as we enter other European markets." Borgward will increase the workforce numbers and investments as production output increases. The initial investment will be in the eight-digit euro range.

In accordance with Borgward's announcement that it will begin sales in Europe with electric SUVs, the first model to be produced in Bremen will be a Borgward BX7 with an all-electric drive system. The company also plans to manufacture electric and plug-in- hybrid versions of the BX5 series and other models.

Industry 4.0 to serve as the guidepost for the new production facility

From the very start, Borgward's Bremen plant will base the technological aspects of its manufacturing system, processes, and equipment on the Industry 4.0 standard. The facility's layout will be focused on the smart factory-the planned production process will be extremely efficient and able to handle the increasing complexity in automotive manufacturing. The amount of local value-added can't be fully determined yet. Along with suppliers that have already been announced, e.g. Continental, Kuka, Schäffler/SKF, BorgWarner, and Webasto, Bosch will play a major role in the production of all-electric vehicles, while the electronics company LG will do the same with regard to batteries.

Borgward's Bremen facility will closely cooperate with the Borgward plant in Miyun, China, near Beijing, which was also constructed according to the latest Western standards. The Miyun plant is one of the most modern automobile manufacturing facilities in the world - in terms of production technology, quality management, environmental compatibility, logistics, and the social aspects for the Borgward employees there. With this facility, Borgward is following successful and renowned competitors who have demonstrated that vehicle production in China maintains the same standards as in Germany in terms of resource conservation, effective environmental protection, and high levels of quality. The Miyun manufacturing facility, which was commissioned in mid- 2016, will also serve as the home plant for Borgward's emerging global production network. The Chinese plant will collect and evaluate all the feedback and experiences from the various markets and production locations, develop solutions, and then forward this information back to the relevant units. This will ensure a continual transfer of knowledge that will lead to a continual increase in product quality that will also benefit the Bremen plant and the customers in Europe.

The Borgward BX7 - already a big hit

The BORGWARD BX7 is a model for the globally popular market for large mid-size SUVs. The 4.70-meter-long newcomer has been a big hit ever since it was launched in its first market, China, in June 2016. To date, around 15,000 units have been ordered there. The best-selling new SUV has impressed Chinese customers with its innovative all-wheel drive system and Multiple Interaction, which is the most advanced online communication and entertainment system on the market. Outstanding safety is guaranteed by the intelligent and comprehensive PROTECT occupant protection concept, which uses pioneering vehicle handling systems and supportive driver assistance systems to help prevent collisions. If the worst comes to the worst, however, a very strong passenger compartment with precisely defined deformation zones, as well as passive restraint systems, provide reliable protection and can significantly mitigate the consequences of an accident.

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Further information

BORGWARD Group AG
Kriegsbergstrasse 11
70174 Stuttgart, Germany

Marco Dalan
Head of Global Communications
Telephone +49 711 365101041
e-mail media@borgward.com www.borgward.com