No green light for BYD and Geely production in Latin America yet

The move was reported by Reuters, citing two people familiar with the matter. At least the speculation about delaying the construction of a BYD factory in Mexico is nothing new: back in March, it was reported that the Chinese authorities feared that Mexico would gain unrestricted access to BYD’s expertise and that the US could possibly grant access.

BYD announced its intention to build a plant in Mexico in 2023. Over the course of last year, the plans then became more concrete, for example in the search for a location. However, no final location has yet been announced. One possible reason could have to do with the outstanding green light from Beijing, as Chinese manufacturers need authorisation from the Chinese Ministry of Commerce to manufacture abroad.

Geely, for its part, announced in February 2025 that it wanted to use the production facilities of French car manufacturer Renault in Brazil. The Chinese carmaker wants to acquire a stake in Renault do Brasil and, in return, benefit from Renault’s local production and sales resources.

However, the approval of BYD and Geely’s plans in Latin America is taking longer than expected. According to Reuters‘ insider sources, the Chinese authorities claim that the plans pose risks for technology transfer. They fear that important Chinese know-how will wander abroad. Although authorities do not want to ban investments by Chinese car manufacturers abroad in general, they want to scrutinise them more strictly and carefully. The timeframe for the review has been extended and companies will be asked to submit more documents, a Reuters source added.

Oddly, Geely stated that the cooperation with Renault do Brasil had started successfully, without delays or additional reviews. The company presented its first model for the Brazilian market this week, namely the Geely EX5 electric SUV (see picture above), which will initially be imported.

However, the Brazilian and Chinese authorities have yet to grant authorisation for this, as the Brazilian magazine Valor writes. The information is thus consistent with the Reuters sources, according to which authorisation for the start of production in Brazil has not yet been granted by the Chinese authorities.

The Chinese government’s influence on the foreign activities of Chinese car manufacturers became even more clear just a few days ago: After just six months, series production of the Chinese Leapmotor T03 small electric car was cancelled at a Stellantis plant in Poland. Political pressure from China may have played an important role, as Poland was one of the countries in favour of EU punitive tariffs on electric cars manufactured in China.

BYD, on the other hand, plans to open its first European plant in Hungary, a country that is said to have voted against the punitive tariffs and is therefore likely to be in the Chinese government’s favour.

reuters.com, valorinternational.globo.com (Geely) renault.co.br (EX5-Launch)