Ford Authority

U.S. Gets Mexico To Drop Incentives For Chinese EV Makers

Chinese EV makers have been a hot topic as of late, and for good reason – thanks to years of government subsidies, domestic mining of raw materials, and heavy incentives for buyers, those models are currently selling for less than $10,000 in some cases. This has caused quite a bit of alarm on the part of automakers like Ford, which admits that it isn’t ready to compete with cheap Chinese EV models if they make it to American soil, as well as the Biden Administration and other government officials, which consider such vehicles a threat to national security. The U.S. is exploring the possibility of raising tariffs or blocking imports altogether, and in the meantime, Ford is working on its own cheap all-electric platform inspired by these Chinese EVs and designed to compete against them. Now, Mexico has joined in by agreeing to drop its incentives for those same companies, according to Reuters.

BYD Han - Exterior 002 - Rear Three Quarters

According to this new report, the Mexican government will not offer Chinese EV automakers any sort of incentives – whether that be tax cuts for investments in production facilities or cheap public land to build factories on – following pressure from the U.S. government. This is notable because – as Ford Authority reported back in February – that country’s largest EV automaker, BYD, has been eyeing Mexico as the potential site of its future North American plant, which could be used as an export hub for the U.S. automotive market.

At that meeting, Mexican officials reportedly told BYD brass that the country would not be handing out incentives as it has done with other automakers in the past, and that it would also be pausing future meetings with Chinese EV makers as well. Currently, around 20 Chinese automakers sell vehicles in Mexico – making up around a third of that market – but none have production plants in that country.

BYD Seagull - Exterior 003 - Rear

Thus far, no parties involved in this report have commented on the matter, though the Office of the United States Trade Representative (USTR) did note that the United States-Mexico-Canada Agreement (USMCA) was not designed to “provide a back door to China and others who may be seeking to access our market without paying … tariffs.”

We’ll have more on the growing threat of Chinese EVs soon, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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