By the end of the year, the company hopes to select a location for the plant, which will have the capacity to produce 150,000 cars yearly, according to Li.
In the fourth quarter of 2023, BYD’s global EV sales surpassed those of the previous market leader, Tesla. Auto industry executives believe that BYD’s entry into Mexico portends a competitive challenge from the Shenzhen-based automaker and other Chinese competitors to U.S.-based businesses.
The Alliance for American Manufacturing, a lobbying group for American manufacturing, issued a warning this month that Chinese automakers’ ability to remain in business could be jeopardized by their low-cost vehicles and parts.
The group demanded that Washington stop allowing cheap Chinese cars and parts to enter the country from Mexico in order to save the American auto industry from experiencing a “extinction-level event”.
Li stated that BYD’s goals for Mexico are limited to local sales and that the business is looking for production locations in central and southern Mexico rather than in the northern part of the country, which is close to the US border, where she claimed there would be high transportation expenses to reach customers.
“Our plan is to build the facility for the Mexican market, not for the export market,” she said.
Li responded that Mexican authorities had been open to BYD’s intentions when asked if they had brought up American worries about Chinese automakers.
Analysts claim that Chinese automakers have been making significant advancements in their cars at a faster rate than their international competitors in some areas, like infotainment systems and autonomous driving.
Executives from BYD’s Chinese competitors who are currently selling cars in Mexico claim that the company is especially aggressive and cost-competitive among Chinese manufacturers. Just as it has done in its home market, BYD might introduce dramatic price reductions to Mexico, pushing competitors to reduce expenses to stay competitive.
According to experts, BYD’s cost advantages stem from its early investment in electric vehicle technology and the high level of vertical integration the business has attained over time, which is comparable to
Similar to its American electric vehicle competitor, BYD manufactures a wide range of auto parts and systems, including motors, batteries, power management processors, and dashboard screens.
On Wednesday, BYD officials declared that the company will start selling its Dolphin Mini electric vehicle (EV) in Mexico for 358,800 pesos ($20,990), which is less than half the cost of the least expensive Tesla model.
Li stated during a Mexico City launch ceremony that the goal of the vehicle is to combine technology with a cost that is affordable for Mexican buyers.
“It’s affordable … so every Mexican can bring their first electric car home,” she said.
Even as BYD’s Mexico sales are doubling monthly, Li also noted challenges for encouraging consumers to adopt EVs, such as Mexico’s still-limited network of charging stations.
“We still need a lot of hard work to educate the market.” ($1 = 17.0941 Mexican pesos)
