BYD: Chinese electric car manufacturer plans a plant in Mexico

The Chinese electric vehicle manufacturer BYD is currently examining at which location in Mexico it will build its plant. Around 10,000 jobs are to be created there. Jorge Vallejo, BYD General Director for Mexico, told the Bloomberg news agency last week. According to Vallejo, BYD has received offers from 23 Mexican states, but has made a pre-selection and is currently examining three possible locations for the construction of the plant. Final negotiations are currently underway. An official announcement is expected in the coming months, Vallejo told Bloomberg.

If the plans to build the plant with 10,000 jobs are realized, the BYD plant would be one of the largest car factories in the country. By comparison, the Volkswagen plant in Puebla, the largest in Mexico, employs 6,100 workers in manufacturing and 5,000 supervisors, as well as thousands of workers in parts assembly. BYD, the world's largest manufacturer of electric cars, says it intends to produce in Mexico for the local sales market. Vallejo said that BYD is on track to sell 50,000 units in Mexico this year. In mid-May, the Chinese car manufacturer chose Mexico as the location for the global market launch of its new hybrid pick-up called Shark - a further sign of the country's growing importance for the company.

USA in tariff war against Chinese electric cars

Earlier this year, BYD executives also stated that Mexico was an ideal place to expand into other markets. This was probably not exactly greeted with enthusiasm, especially in the USA. Chinese investments in Mexico, particularly in assembly plants for the automotive industry, have recently led to tensions between the governments of Mexico and the United States. The Joseph Biden administration sees the establishment of Chinese companies in the neighboring country as a threat to national security. US parliamentarians from both major parties have expressed their concern that China could use Mexico to gain access to the US market for its goods. Together with the USA and Canada, Mexico is part of the North American Free Trade Agreement USMCA (formerly NAFTA). Just a few weeks ago, the US government announced that electric vehicles from China will be subject to a 100 percent tax in future.

BYD's plans to expand its activities in Mexico despite the US announcement to increase tariffs on Chinese vehicles are in contrast to those of its main competitor, the US electric car manufacturer Tesla. In March last year, Tesla announced a gigafactory in northern Mexico with much fanfare, but without giving a timetable for construction or any details. There is talk of an investment of five billion US dollars. Despite water shortages in the region, the government in Mexico City gave the green light for the construction of the plant. However, there have recently been repeated rumors that Tesla might not build a plant in Mexico at all. Tesla boss Elon Musk also expressed concerns. One thing is certain: Tesla has not yet started construction work, and there are no signs that this could start any time soon.

(akn)