BYD Presses Mexico On EV Plant As 50% Tariff Looms

Chinese electric-vehicle maker BYD is edging back toward a factory bet in Mexico, even as the country prepares tariffs of up to 50% on imported cars from nations without trade agreements, including China.

At the Expo Transporte 2025 fair, corporate vice-president Julián Villarroel said the company expects to announce a manufacturing project “in the coming weeks,” likely before January 2026, insisting that “the plan is still on track” and that Mexico and Brazil are now the core of its Latin American strategy.

In just two years, BYD has sold about 80,000 vehicles in Mexico, roughly 40,000 of them in 2024 alone, making it one of the main drivers of the fast-growing EV and plug-in hybrid market.

The group already has around 700 trucks operating in the country and wants to close 2025 with 1,200, aiming for 5,000 units next year as new cargovans arrive.

The real leverage, however, lies in batteries: BYD designs and manufactures its own lithium packs, a big share of any EV’s cost, allowing it to undercut rivals that depend on outside suppliers.

That model now collides with Mexico’s protectionist turn. The government has signalled it will raise tariffs on vehicles imported from “third countries” from 20% to as high as 50%, covering both combustion and electric models.

Mexico must choose investment or tariffs

Officials argue this is needed to shield local industry. BYD is lobbying for electric vehicles to be exempt, warning that punishing zero-emission units would slow the shift away from gasoline and diesel and weaken Mexico’s environmental goals.

To reduce that political risk, the company is studying local production, mirroring its move in Brazil, where it is building a mega-complex in Bahia that could eventually produce 300,000 vehicles a year.

In Mexico, state authorities in Morelos are actively courting BYD and other Asian brands to occupy Nissan’s recently closed Civac plant, hoping to protect jobs and attract new technology.

For Mexico, the choice is stark: design rules that welcome long-term industrial investment, or lean on short-term tariff walls at the cost of higher prices, slower electrification and factories built somewhere else.

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