On August 25, the 1,000,000th locally-produced Mercedes-Benz engine officially rolled offline at the Beijing Benz Automotive Co., Ltd. (hereinafter referred to as the BBAC) and the Engine Plant saw its monthly production volume exceeding 30,000 units. Mr. Chen Hongliang (Senior Executive Vice President of BBAC) and other managers attended the off-line ceremony. The local production of 1,000,000 units marks that the only overseas Engine Plant of Daimler embraces a milestone of production capacity release and heralds that BBAC will scale a new height at a faster pace.

[BBAC’s engine production firstly exceeds 1,000,000 units]

In the automotive industry, there is a saying that “who owns engines will have competitive advantages”. As a core component, engine is an important part of auto-making and a “focus” for the technology development and product pricing. Compared to premium automotive brands, locally-produced engines make cars affordable for ordinary consumers. Engine is also an important part of the localization of manufacturing and service. Committed to “Build Mercedes-Benz in China” and BBAC has incorporated engine localization into its development blueprint since its establishment.

On August 8, 2006, the first locally-produced Mercedes-Benz engines officially went offline, paying tribute to the first anniversary of BBAC. In the following nine years, BBAC Plant I Engine Shop domestically-produced engines for E-Class, C-Class, GLK- Class and other models successfully. During this period, BBAC experienced a leapfrog development, continuously improved manufacturing capacity and process quality, laid a solid foundation for enterprise platform-based and series development and also enabled Daimler to tap into unlimited possibilities in Chinese market.

On June 28, 2011, the BBAC Engine Plant, R&D Center and New Project Investment Framework Agreement was officially signed, jointly witnessed by Wen Jiabao, Premier of the State Council and Angela Merkel, German Chancellor. Since then, BBAC has entered a new development stage and opened a new chapter of this long-planned domestically-produced engine project.

On November 2, 2012, within 16 months after this Agreement was signed, BBAC Engine Plant Phase I was officially put into production and completed equipment installation at an amazing speed praised as “China Wonder”, marking the birth of Daimler’s first overseas engine plant for Mercedes-Benz passenger cars.

[BBAC owns Daimler’s first overseas Mercedes-Benz passenger car at the Engine Plant]

Since then, BBAC has realized a transformation from pure finished vehicle manufacturing to producing core parts and commanding core manufacturing process technology. The BBAC Engine Plant shoulders the mission of powering the Mercedes-Benz brand and driving the growth of Chinese and even global market. Bearing the determination of Daimler AG to intensively explore Chinese market in mind, BBAC will forge ahead to rewrite the history of luxury vehicle manufacturing in China.

In April 2013, M276 engine successfully completed its first trial assembly and highly acclaimed by Daimler AG quality release team as “green release”. Meanwhile, the first crankshaft for Mercedes-Benz engine produced outside of Germany went offline at BBAC. One month later, the assembly of M274 and M276 engine kicked off successfully. BBAC Engine Plant officially enters the trial production stage.

On November 18, 2013, the BBAC Engine Plant Phase I was officially put into operation. Worth noting, this modern plant represents cutting-edge core technology and excellent quality for luxury automobile manufacturing. It has enabled BBAC to have the capacity of whole-set engine assembly and the capacity of core component manufacturing that is unique in the industry. In June 2014, the three core components (i.e. cylinder block, cylinder head and crankshaft) of the engine produced by BBAC Engine Plant were successively used for the whole vehicle assembly in Daimler Engine Plant based in Germany. From then on, BBAC has been officially included in Daimler’s global purchasing/supply chain, representing that its product quality is fully compliant with Daimler’s highest standards worldwide and “Made in China” proudly appears on the stage of global premium auto-making.

In March 2015, as an outstanding representative of new generation Mercedes-Benz engines with small and medium displacement and one of three major engines introduced by BBAC Engine Plant, M270 engine successfully went into operation at BBAC Engine Plant. Since then, three series engines produced by BBAC have entered series production, brought more choices to introduce new models and upgrade existing models subsequently, and also safeguarded the successful implementation of product layout, corporate development and other strategies.

[All three types of engines of BBAC have entered the serial production stage]

In four years, this world’s leading plant has achieved one and another progress and has won wide acclamation from numerous industry insiders (including Daimler’s German experts) with its fast development pace. It has also accumulated valuable experience for BBAC in such aspects as quality and safety, and built a powerful and highly skilled team in engine industry. These are illustrated in the Phase II Project of Engine Plant.

In July 2015, the BBAC Engine Plant Phase II Project attained the goal of ‘Six-Zero’ (i.e. zero safety accident, zero delay in customs clearance, zero supplier complaint, zero obstacle in serialized production, zero-distance in department support and zero risk in milestone) and commenced production two months in advance, representing the first Daimler’s overseas Mercedes-Benz engine plant was officially completed.

“BBAC now has the ‘largest’ manufacturing base for Mercedes-Benz passenger vehicles. The ‘largest’ area also embodies BBAC’s strength. ” As pointed out by Mr. Rene Reif (Executive Vice President of Engineering & Manufacturing of BBAC). After 11 years of development, BBAC has built the world’s largest and most comprehensive luxury vehicle manufacturing base for Mercedes-Benz passenger vehicles, in combination of R&D, engine manufacturing and finished vehicle manufacturing. BBAC has become the only joint venture limousine manufacturer of Daimler worldwide possessing the front-drive, the rear-drive and the powertrain platforms. Correspondingly, BBAC has quickly released capacity and continuously improved market competitiveness. Only in 2015, BBAC realized both production and sales volume exceeding 250,000 units. The year 2016 maintained this sound momentum, generating new demands for engine production.

[Mr. Rene Reif, Executive Vice President of Engineering & Manufacturing of BBAC, delivers a speech]

On June 13, 2016, BAIC Motor Corporation Ltd. signed a framework agreement a framework with Daimler, aiming to increase the capital by RMB 4 billion, which will be used for further expanding BBAC’s Engine Plant. This is an important agreement, representing the determination of Mercedes-Benz brand to deeply root in Chinese market; BBAC has reached a new level in manufacturing and management capacity and BBAC Engine Plant has entered a new chapter.

“Three years ago, we might worry about whether we could create the maximum value even BBAC has the most advanced engine production line? Now, this question has an affirmative answer”. Mr. Chen Hongliang (Senior Executive Vice President of BBAC) stated at the off-line ceremony. The offline of the 1,000,000th locally-produced Mercedes-Benz engine manifests that BBAC has not only made a breakthrough in corporate strength and but also cultivated an outstanding technician team that can fully meet Daimler’s world-leading production process requirements.

[Mr. Chen Hongliang, Senior Executive Vice President of BBAC, delivers a speech]

At this starting point, BBAC’s cultivation of highly skilled engine personnel will scale new heights. At the off-line ceremony, Mr. Chen Hongliang, Mr. Rene Reif, Mr. Liu Xixin and Dr. Markus Keicher (Vice Presidents of Engine of BBAC) unveiled Beijing Chief Technician Studio - Zhao Bin Studio. As an important part of BBAC Chief Technician Studio System, the Studio will carry forward the fine tradition of “Technical Innovation and Skill Pass-on” and promote the cultivation of more highly skilled personnel.

[“Zhao Bin Studio” is officially unveiled]

As stated by Mr. Chen Hongliang, the offline of the 1,000,000th engine is not only a milestone but also a new starting point. Based on 1,000,000 units, BBAC Engine Plant will fulfill its mission of “Benz Power, Beijing Build and Global Share” and embark on the Industry 4.0 path to create its engine version. BBAC will inevitably maintain an unprecedented momentum and stride toward the goal of becoming an internationalized benchmarking manufacturer in the Chinese premium automobile market.