Chinese EV maker BYD eyes state incentives for Mexico plant
Recasts; adds executive comments in paragraphs 3-4; adds information on manufacturing plan, government meetings
By Cassandra Garrison
MEXICO CITY, Aug 21 (Reuters) -Chinese electric vehicle maker BYD 002594.SZ has narrowed its list of finalists for the location of a manufacturing plant in Mexico down to three states and is reviewing a range of proposed incentives from them, the firm's country head said on Wednesday.
Jorge Vallejo, BYD's Mexico director general, told Reuters the company was reviewing the latest proposals by the candidate states, which have offered "many benefits" including fiscal, land, management and preferential pricing incentives.
"A plant is not only about having the space, but the logistics, all the development, urban infrastructure that is generated, water, gas, everything that is needed for an automotive plant," he said.
"There are many elements, even logistical, that we are analyzing together with them," he said, adding that the aim remained to identify the location by year-end.
Mexico's federal government, under pressure from the U.S., is keeping Chinese automakers at arm's length by refusing to offer incentives such as low-cost public land or tax cuts for investment in EV production, Reuters reported in April, citing Mexican officials.
Vallejo did not name the states offering incentives, though BYD Chief of Americas Stella Li said in May the plant will be centrally located in the country.
Mexico's northern Nuevo Leon state is an automotive hub, and the location of a proposed Tesla TSLA.O mega-factory. It will also be home to a new Volvo plant, the state's governor said this week.
Meanwhile, the central Puebla state has long housed production by Volkswagen VOWG.DE, and BMW BMWG.DE makes EVs in the nearby San Luis Potosi.
Vallejo, speaking after unveiling of BYD's Song Pro plug-in hybrid SUV in Mexico, said that the firm had not yet identified which models would be produced at the Mexico plant.
The plant will produce 150,000 units in its first stage and 250,000 units in its second stage before eventually producing between 400,000 and 500,000 units in a few more years, Vallejo said.
The plant will serve the Mexican market, he reiterated. The company has previously said it was not eyeing an entry to the U.S. market.
BYD executives were hoping to meet with the team of Mexican President-elect Claudia Sheinbaum and the economy ministry in the "coming days" to share plans for the plant, Vallejo said.
The company would "specifically present the manufacturing and marketing scheme, and also to show what BYD can develop at a national level," Vallejo said.
BYD's plug-in Song Pro, priced at 599,880 pesos ($31,146.42), aims to further bridge the transition from gas to fully battery powered EVs, a pursuit that has so far seen Chinese automakers come out ahead of their Western counterparts.
($1 = 19.2600 Mexican pesos)
Reporting by Cassandra Garrison; Editing by David Alire Garcia, Sarah Morland and Jamie Freed
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.