Mercedes-Benz Vans will build a new assembly plant for its Sprinter vans in North Charleston, South Carolina. Vans are currently assembled in Germany, disassembled and shipped to North Charleston and then re-assembled to avoid import duties on finished vehicles. Will go from 140 workers to 1,300. BMW employees 8,000 in Greer SC to make X SUV's.
State incentives include job development credits and a $14 million grant for property improvements. Will probably also receive property tax reduction for 30 years. Gov. Nikki Haley, who is strongly anti-union, said the state's pro-business climate and non-union workforce were also important. The existing plant is not unionized.

 

As an aside( not totally related), this explains why one of our friends in SC has 15 relatives that have BMWs. I was told that they get a significant discount for being an employee.

 

What is this "assembled, disassembled, shipped and reassembled" business?
Why not just ship the parts and assemble at the final site? I don't understand this logic.

 

To save on taxes I think .

 

I know from reading old car magazines that this has been done for years by various companies. I think GM, Ford and Chrysler did it long time ago when shipping "cars" to Australia.
But as you ask, why not just send parts to US?
The reason for disassembling, shipping and reassembling to avoid high tarrifs on "whole" vehicles. Years ago, the Japanese companies would ship their pick-ups with the beds off and then reassemble when they got to US. Therefore they avoided the tarrifs on "whole" vehicles.
All of these things are done at the behest of the lobbyists for the "native" car companies. As Chevrolet used to advertise, the Corvette is an expensive, imported sports car in Europe.
Many of the employees at BMW are actually contract workers hired through another company, so don't know if they get an employee discount. Living in the area, I still see more M-B's on the highways than I do BMW's. Many of the BMW's are "factory" cars, but license plates no longer show that so you can't tell.

 

I find this strange. I thought the duty was only 2%.

 

Research "Chicken Tax" - http://en.wikipedia.org/wiki/Chicken_tax
Ford was (is?) importing Transits with seats (as a passenger vehicle) and then removing/destroying the seats in order to avoid the same tax issues.

 

Don't overlook moving production from unionized Germany to anti-union American South. That and the huge financial incentives offered by state and local governments for decades to come.