BYD Halts Mexico Plant Plans Amid US Trade Tensions, Claims Bloomberg

BYD has paused plans to build a new factory in Mexico due to rising geopolitical tensions and trade policy uncertainty linked to the United States, according to a report from Bloomberg News. The move comes as the Chinese automaker reassesses its expansion strategy in the Americas, even as it opens its first manufacturing facility outside Asia in Brazil.

Geopolitical tensions stall North American factory ambitions

Speaking in Brazil’s Bahia state, BYD Executive VP Stella Li told reporters that the company was holding off on further investment decisions until the outlook becomes clearer. “Geopolitical issues have a big impact on the automotive industry,” Li said, adding that “now everybody is rethinking their strategy.”

BYD had been exploring three locations in Mexico for a new plant but halted the search last year, awaiting the results of the 2024 U.S. presidential election. Mexico President Claudia Sheinbaum confirmed in March that BYD had not made a formal offer to invest in the country, while China’s commerce ministry reportedly delayed approval for the facility over fears the company’s tech might be accessed by the U.S.

US trade tariffs force manufacturers to reevaluate global operations

Tensions escalated after former President Donald Trump proposed sweeping tariffs on U.S. trading partners and new taxes on certain imported goods, including vehicles. The changes have prompted American automakers like General Motors to reconsider cross-border operations, with GM announcing a $4 billion plan to shift production of some models from Mexico to the U.S.

While BYD says it still intends to expand its global production footprint, the timeline remains uncertain. “We want to wait for more clarity before making our decision,” Li said.

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