BYD is exploring establishing an EV factory in Mexico to enhance its supply chain efficiency and reduce export costs to the North American market.

Zhou Zou, the head of BYD Mexico, highlighted the strategic significance of overseas manufacturing and identified Mexico as a critical market with substantial potential during an interview on February 14.

This initiative aligns with BYD’s strategy to create export hubs in Mexico that could serve the United States and other international markets. Under the agreement between the United States, Mexico, and Canada, at least 75% of auto parts must be manufactured in one of the three regions to benefit from potential tariff benefits.

Furthermore, the U.S. Inflation Reduction Act imposes specific assembly location requirements and stringent criteria for battery sourcing to be eligible for a 7,500 USD tax credit.

Mexico has emerged as an attractive destination for EV manufacturing, with several major automakers, including Kia, BMW, and Stellantis, announcing their plans to produce electric vehicles in the country. Tesla also revealed its intention to build a gigafactory in Nuevo León state.

BYD has already introduced a range of EV products in the Mexican market, including models such as the Han, Tang, Atto 3, Dolphin, and Seal, along with the Song Plus DM-i plug-in hybrid electric vehicle (PHEV) and several pure electric buses and chassis products.

Considering a new EV factory in Mexico is part of BYD’s global expansion strategy, which already includes overseas EV factories in Thailand, Uzbekistan, Brazil, Hungary, and Indonesia.

BYD wants to implement a dual-core strategy in the North American and Latin American markets. We regard Mexico as the core of the North American market and plan to improve the supply chain and establish factories in Mexico. In addition, it acquired a Ford Motor plant in Brazil to supply the Brazilian local market and other Latin American regions.

Source: iTHome