Chinese electric-vehicle (EV) maker BYD is looking for a location in Mexico to set up a factory aimed at boosting the company’s share of the local market, BYD Americas CEO Stella Li said on Wednesday.
The company expects to choose a location for the plant, which is set to have a production capacity of 150,000 cars annually, at the end of the year, Li said.
BYD’s push into Mexico foreshadows a competitive threat the Shenzhen-based EV maker and others from China may pose to companies already operating in the US market, industry officials say.
A US manufacturing advocacy group, the Alliance for American Manufacturing, this month warned low-cost Chinese cars and parts could threaten the viability of car companies in the US. The group called on Washington to block the import of low-cost Chinese cars and parts from Mexico.
“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 US auto sector,” the alliance said in a report.
Analysts say Chinese carmakers have been rapidly improving their vehicles and are even moving faster than global rivals in some areas, such as infotainment systems and autonomous driving.
BYD has been meeting officials from different Mexican states, Li said, while sharing that sales in Mexico are doubling monthly.
The Chinese company has been selling cars in Mexico for less than a year.
BYD aspires to take on Ferrari, Lamborghini with a US$233,000 super EV
BYD aspires to take on Ferrari, Lamborghini with a US$233,000 super EV
BYD is particularly cost-competitive and aggressive among Chinese players, according to executives from its Chinese rivals already selling cars in Mexico. BYD may bring aggressive price cuts to Mexico, just as it has done in its home market, forcing rivals to slash costs to keep up.
Cost advantages for BYD come from its early investment in EV technology and a high degree of vertical integration the company has achieved over the years, experts say, not unlike Tesla.
Like its American EV rival, BYD produces an array of automotive components and systems on its own, from batteries to motors to power management chips to dashboard screens.
BYD launches low-price plug-in hybrid, sparking price war in China
BYD launches low-price plug-in hybrid, sparking price war in China
BYD outpaced Tesla in EV sales in the fourth quarter of 2023 and has cut prices considerably on its latest models in China.
BYD executives announced earlier on Wednesday that the carmaker will begin selling its Dolphin Mini EV in Mexico at a starting price of 358,800 pesos (US$20,990), less than half the price of the cheapest Tesla.
At a launch event in Mexico City, Li said the car aims to mix technology and a price point in reach of Mexican consumers.
“It’s affordable … so every Mexican can bring their first electric car home,” she said.