BYD postponed investment in Mexico due to geopolitical tensions and concerns

The Chinese electric vehicle manufacturer BYD has delayed its plan to build a plant in Mexico, citing concerns about the possible leakage of advanced technology to the United States and the growing geopolitical tensions.

Concerns about technology transfer

Sectors like the automotive industry have been particularly attractive for Chinese investment. Brands like BYD, Jac, and Geely have gained ground in the Mexican electric vehicle market, capturing around 20% of this segment.

The inauguration of air cargo routes between Chinese cities and Mexico also reflects the strengthening of commercial ties with the CCP.

Chinese authorities fear that, due to the geographical proximity between Mexico and the United States, BYD's advanced technology could be accessible to the neighboring country.

This concern has led China's Ministry of Commerce to delay the approval of the proposed plant in Mexico.

Underreporting and investment triangulation

Despite official figures, experts point out that Chinese investment in Mexico could be underreported. Sergio Ley, president of the Asia and Oceania section of the Mexican Council of Foreign Trade, Investment, and Technology (Comce),

has highlighted that many Chinese investments arrive in Mexico through third countries, such as Hong Kong or tax havens, which makes their precise registration in official statistics difficult.

This practice of triangulation could imply that the real volume of Chinese investment in Mexico is significantly higher than reported. It is estimated that it could be up to six times higher than official figures.

Impact of geopolitical relations

The tense relations between the United States and China have influenced BYD's decision. Additionally, Mexico, due to its economic relationship with the United States,

has adopted a more cautious stance toward Chinese investments, which further complicates the situation for BYD.

Reactions and denials

Despite reports of the investment suspension, Stella Li, BYD's regional head for the Americas, clarified that the company has not postponed any decision regarding the factory in Mexico and that they continue working to build a plant aimed at the Mexican market.

The situation reflects the complexity of international investments in the current context of geopolitical tensions and technological concerns.

BYD's final decision on its plant in Mexico will depend on how these factors evolve in the coming months.