BMW Brilliance recalls more than 140,000 cars

German carmaker BMW has announced that it has recalled more than 140,000 cars in China. Less than a week ago, BMW's expansion plan was criticized by the Chinese Ministry of Environmental Protection.

BMW Brilliance stated that the recall was initiated by the manufacturer, because the steering system of the BMW 5 Series cars produced in the past four years was affected by a defect. BMW Brilliance is a joint venture established by BMW in China.

BMW Brilliance said, "As soon as we discovered this defect, we immediately reported it to the government." BMW Brilliance operates a production plant in Shenyang, a major industrial city in Northeast China. Last week, the Chinese Ministry of Environmental Protection refused to approve the plan to double its annual output to 400,000 units and expand an engine production plant.

The Ministry of Environmental Protection of China criticized the report on environmental impact submitted by BMW Brilliance as "not sufficient" and failed to meet the government's target of reducing pollutant emissions. BMW said that the MEP’s “Approval Review Publicity” is not the final decision and will not postpone its plan to invest RMB 9.23 billion (US$ 1.5 billion) in its expansion plans.

In the first half of this year, BMW’s sales in China, the world’s largest market, rose by 15% to 183,000 units. Sales of BMW Brilliance contributed more than half of them.

Analysts said that the recall was caused by a defect in the seal that could lead to corrosion of the water, which did not seem to be as serious as the recall of Volkswagen in March. Robin Zhu, automotive analyst at Bernstein Research, said: "The financial impact of this recall on BMW is basically zero."