At the edge of the Baltic Sea, just past the rusting hulks of the trawlers that crowd the port of Kaliningrad, sits a nondescript, seemingly abandoned factory. Inside, however, scores of mechanics are assembling classy sedans, while nearby, engineers in white lab coats huddle to discuss production levels with their Russian colleagues in German-inflected English. It's an incongruous setting for one of Europe's most prestigious automotive marques, the Bayerische Motorwerken, better known as BMW.
In a move that struck many in Moscow's downtrodden business circles as quixotic, BMW set up shop in Russia last fall. The arrival represents a return to...
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