The growing US electric vehicle market presents new opportunities for Chinese makers, big and small. Driven by incentives from the US Inflation Reduction Act, President Joe Biden\u2019s signature green industrial policy, electric vehicles are projected to account for 52%<\/a> of all US auto sales by 2030, which would meet the 50% target<\/a> set for the year by his administration.<\/p>\n\n\n\n The ability to export from Mexico allows Chinese companies to benefit from trade rules in the region: under the US-Mexico-Canada (USMCA) agreement, if 66%<\/a> of a vehicle\u2019s parts are made in North America, manufacturers can export them to the US duty-free, avoiding the higher tariffs they may otherwise pay. This has, however, led to criticism from some quarters of the industry in North America, including Canadian automakers concerned<\/a> over their capacity to compete with Chinese companies.<\/p>\n\n\n\n As Mexico welcomes rising investment in its EV industry, with production largely destined for export, questions remain over the broader benefits. In a country where the transport sector accounts for nearly a third<\/a> of all carbon emissions, can these investments help to accelerate Mexico\u2019s own shift towards electromobility, improve access to EVs and ensure a just transition?<\/p>\n\n\n\n Chinese automakers have been selling electric and conventional vehicles in the Mexican market for over a decade, and in recent years have established themselves among the main suppliers<\/a> of cars in the country. <\/strong>Vehicles manufactured in China by brands including BMW and Chevrolet, among others, have also been sold in Mexico.<\/p>\n\n\n\n Three Chinese EV makers have already established assembly plants in Mexico: Foton<\/a>, a truck, bus and SUV maker that is a subsidiary of the state-owned Beijing Automotive Group (BAIC); JAC Motors<\/a>, which offers three EV models in the country; and bus and truck manufacturer Shacman<\/a>. State-owned Chery<\/a>, and its subsidiary brand Jetour<\/a>, have announced initiatives to build Mexican factories.<\/p>\n\n\n\n In addition, at least seven Chinese auto parts suppliers have announced plans for industrial facilities to supply the growing electric vehicle industry.<\/p>\n\n\n\n Foton has operated<\/a> its truck assembly site in the western state of Jalisco since 2019, and has plans<\/a> to build a plant for both internal combustion and electric vehicles that would begin production by 2025, with a reported investment of over US$1 billion. The company will reportedly partner with Chinese firm CATL, the world\u2019s largest producer of electric vehicle batteries, as part of a battery recycling and repair scheme.<\/p>\n\n\n\n In March, Jetour announced<\/a> its intention to build a $3 billion factory to assemble conventional and electric cars, which will enter operation by the end of 2024, though a location for the facility has yet to be confirmed. The company is partnering with the Mexican organisation LDR Solutions<\/a>, which has represented brands such as the electric vehicle manufacturer BYD, Jetour and CATL in the country.<\/p>\n\n\n\n Chinese companies look to be leaning on the experience of peers in Mexico. Since 2017, JAC Motors, for example, has worked in partnership<\/a> at a plant in Hidalgo state with Giant Motors, owned by Mexican business magnate Carlos Slim, at one time the world\u2019s richest person.<\/p>\n\n\n\n Osmar Zavaleta, associate dean of research at the Monterrey Institute of Technology and Higher Education\u2019s business school, says sectors such as the automotive industry are looking to Mexico because of its developed technical and logistical capacity, on top of China\u2019s own leadership in electromobility.<\/p>\n\n\n\n \u201cMexico\u2019s potential is enormous. Due to climate change and the prevailing need to stop emitting greenhouse gases from public and private transportation, electromobility is going to take on much more importance in the coming years,\u201d he told Di\u00e1logo Chino.<\/p>\n\n\n\n \u201cThe change towards the use of electric cars is going to happen more quickly. This opens up a great opportunity for Chinese carmakers to take advantage of everything that Mexico offers,\u201d he added.<\/p>\n\n\n\n In 2021, Mexico was the sixth largest exporter<\/a> of EVs, to destinations including the US, Belgium and Norway, while it imported a low volume of units from the United States, Germany and China. However, the high price of such cars currently represents a barrier to mass adoption.<\/p>\n\n\n\n Just a few years ago, Chinese vehicles were a rare sight on Mexican roads, but have grown increasingly visible. In the first half of 2019, 4,156<\/a> Chinese-brand cars were sold in Mexico, just 0.6% of overall sales; by the same period this year, 69,464 had been sold, accounting for 9.3% of all sales, with at least eight brands offering electric and combustion engine models.<\/p>\n\n\n\n In a country with more than 53 million vehicles on the road, around 5%<\/a> are reportedly hybrid or electric, but of these only 5% are Chinese, according to the Mexican Association of the Automotive Industry (AMIA).<\/p>\n\n\n\n Electric vehicle<\/strong> (EV) may be used as an umbrella term to refer to any electrified vehicle, though it is most commonly associated with battery electric vehicles<\/strong> (BEV), which are 100% electrified.<\/p>\n\n\n\n Meanwhile, hybrid electric vehicles<\/strong> (HEV) combine conventional fuel-powered combustion engines with electric motors, with the combustion engine and brakes helping to charge the battery. Plug-in hybrid vehicles<\/strong> (PHEV) use a larger battery that can be recharged at an electrical outlet, and typically run on electric power until nearly depleted, when a combustion engine will take over. <\/p>\n<\/div><\/div><\/div>\n\n\n\n Though their growth has been impressive, Chinese carmakers may run into competition in the electric sector.<\/p>\n\n\n\n Mexican engineer Rafael Contreras bought his first non-conventional car 16 years ago, a hybrid Toyota Prius, with the idea of polluting less. His experience with this hybrid car was pleasant, due to its low fuel consumption and quick recharging, if necessary.<\/p>\n\n\n\n As a result of a fuel shortage<\/a> Mexico experienced in 2019, Contreras bought a Chevrolet Volt hybrid, a plug-in, which his wife uses more. Around that time he also acquired a fully electric Tesla 3.<\/p>\n\n\n\n \u201cWe charge them in the house. I don\u2019t even notice when [the Tesla] is charging, I arrive, I plug it in and when I leave the next day it\u2019s done. I charge it once a week,\u201d the 54-year-old engineer tells Di\u00e1logo Chino.<\/p>\n\n\n\n Contreras, who has solar panels and storage batteries in his home, says he can usually travel up to 550 kilometres on a single charge, and highlights a reduction in operating costs due to savings in gasoline and an included annual service.<\/p>\n\n\n\n \u201cFor my entire life, I would continue with electric cars, I would continue with Tesla, the technological part is very robust. Chinese cars don\u2019t attract my attention. In quality they do not compete and [the Tesla] is safer than BYD and JAC,\u201d he claims.<\/p>\n\n\n\n In this regard, the New Car Assessment Program for Latin America, which examines car safety features, gave<\/a> low ratings for an electric JAC model in 2022 and another conventional vehicle from Great Wall Motors in 2021, scoring not much better than other US competitors, such as Ford, Jeep and RAM. In contrast, Chevrolet, Hyundai, Nissan, Toyota, Mitsubishi and Volkswagen achieved high results.<\/p>\n\n\n\n Contreras\u2019 experiences with electric vehicles are not likely to be broadly representative for Mexican drivers, however. Though officials, such as former foreign minister Marcelo Ebrard, have touted a target for 50% of EVs accounting for 50% of the market and production by 2030, significant barriers remain for everyday Mexicans to access such vehicles, which along with hybrids made up 4.7%<\/a> of the 1.1 million cars sold in 2022.<\/p>\n\n\n\nChinese carmakers grow in Mexico<\/h2>\n\n\n\n
![\"An](\"https:\/\/dialogue.earth\/content\/uploads\/2023\/12\/An-electric-police-vehicle-parked-in-a-charging-station-in-Mexico_-Luis-Gutierrez_Alamy_2KDDKY6.jpg\")
<\/div>Mixed welcome from Mexicans<\/h2>\n\n\n\n
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