(Reuters) – China’s BYD Co (SZ:) Ltd will arrange a brand new electrical car (EV) manufacturing unit in Mexico, reported on Wednesday, citing the corporate’s Mexico head, because the EV maker goals to ascertain an export hub to the US.

BYD, recognized for its cheaper fashions and a extra assorted lineup, just lately overtook its largest rival Tesla (NASDAQ:) Inc to develop into the world’s prime EV maker when it comes to gross sales.

In response to the Nikkei report, BYD has launched a feasibility research for the Mexican plant and is at present negotiating with officers over phrases, together with the manufacturing unit’s location.

Whereas BYD has its gross sales concentrated in China, it additionally goals to broaden globally and is constructing new vegetation abroad along with increasing Chinese language exports.

Mexico’s huge automaking sector, populated by lots of the business’s prime international gamers, is tightly built-in with the U.S. business.

“Abroad manufacturing is indispensable for a global model”, BYD Mexico nation supervisor Zhou Zou advised Nikkei.

The carmaker’s Mexico workplace declined to remark.

Main U.S. automakers have warned that Chinese language vehicles might spell doom for their very own prospects, amongst them Elon Musk’s Tesla.

Final month, Tesla’s chief govt predicted that Chinese language automakers will “demolish” international rivals with out commerce limitations.

Musk’s view is echoed by a number one advocacy group.

“The introduction of low-cost Chinese language autos – that are so cheap as a result of they’re backed with the facility and funding of the Chinese language authorities – to the American market might find yourself being an extinction-level occasion for the U.S. auto sector,” based on a forthcoming report by the group Alliance for American Manufacturing.

In Latin America, BYD plans to spend 3 billion reais ($620 million) on a brand new industrial complicated in northeastern Brazil.

The three plant complicated might be inbuilt northeastern Bahia state, on land previously occupied by a Ford (NYSE:) plant that closed in 2021.

($1 = 4.9510 reais)

(This story has been corrected to repair the identify of the report quoted from Alliance of Automotive Innovation to Alliance for American Manufacturing, in paragraph 11)