BYD Co Ltd from China will open a new electric vehicle (EV) factory in Mexico, according to Nikkei. The EV maker aims to create an export hub to the United States.
BYD, recognized for its lower-cost models and diverse lineup, recently outpaced its main competitor, Tesla Inc (TSLA.O), in terms of sales, becoming the world’s largest EV manufacturer. The company aims to maintain this position with its continued commitment to innovation and affordability.
According to the Nikkei report, BYD (002594.SZ) has initiated a feasibility study for the Mexican plant. Simultaneously, the company is in discussions with officials regarding terms, including the factory’s location.
While BYD’s sales are concentrated in China, the company also aims to expand globally. It plans to achieve this by building new plants overseas in addition to increasing Chinese exports.
Mexico’s extensive automaking sector, featuring many of the industry’s leading global players, tightly integrates with the US industry. As a result, collaboration and coordination between the two nations play a crucial role in the automotive landscape.
“Overseas production is indispensable for an international brand,” BYD Mexico country manager Zhou Zou told Nikkei.
The automaker’s Mexican office declined to comment.
U.S. automakers, including Tesla led by Elon Musk, caution that Chinese cars may impact their prospects.
Last month, Tesla’s CEO forecasted that removal of trade barriers would lead Chinese automakers to outperform global rivals.
A leading advocacy group shares Musk’s viewpoint.
“The introduction of cheap Chinese autos – which are so inexpensive because they are backed with the power and funding of the Chinese government – to the American market could end up being an extinction-level event for the U.S. auto sector,” according to a forthcoming report by the group Alliance for American Manufacturing.
In Latin America, BYD plans to invest 3 billion reais ($620 million) in a new industrial complex in northeastern Brazil.
The three-plant complex will be built in northeastern Bahia state. This land was previously occupied by a Ford plant that closed in 2021.
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