Chinese electric vehicle manufacturer BYD is evaluating incentives from three Mexican states as it finalizes the location for its new manufacturing plant. Jorge Vallejo, BYD’s director general for Mexico, confirmed on Wednesday that the company is assessing various proposals which include fiscal benefits, land deals, management support, and preferential pricing.
Vallejo emphasized that the decision will depend on more than just the location; it will also consider logistics, infrastructure, and essential services required for a state-of-the-art automotive facility. The company aims to select the final site by the end of the year.
The Mexican federal government, under pressure from the U.S., has refrained from offering incentives such as low-cost land or tax breaks for EV production, according to April reports.
While Vallejo did not disclose the names of the states, BYD’s Chief of Americas, Stella Li, previously mentioned that the plant would be situated centrally in Mexico. Nuevo Leon, a prominent automotive hub in the north, is the site for a planned Tesla mega-factory and a new Volvo plant. Central Puebla is home to Volkswagen production, while BMW produces EVs in nearby San Luis Potosi.
At a recent event unveiling BYD’s Song Pro plug-in hybrid SUV in Mexico, Vallejo stated that the company has not yet decided which vehicle models will be manufactured at the new plant. The facility is expected to produce 150,000 vehicles in its initial phase and an additional 150,000 in the subsequent phase, with a long-term target of 400,000 to 500,000 units.
The plant is planned to cater primarily to the Mexican market, as BYD has indicated no intention of entering the U.S. market at this time. Vallejo noted that BYD executives plan to meet with Mexican President-elect Claudia Sheinbaum and the economy ministry soon to discuss the project in detail.
In related news, Stellantis, a French-Italian automaker, recently began EV production at its facility in the State of Mexico. Economy Minister Raquel Buenrostro, who attended the launch, encouraged global companies to collaborate and strengthen supply chains.
