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BYD is Betting on Mexico to Boost its Electric Car Business, Although Electric Vehicle Adoption in the Country is Low

BYD is Betting on Mexico to Boost its Electric Car Business, Although Electric Vehicle Adoption in the Country is Low

More and more automotive companies are expanding or migrating their production towards electric cars, both to compete directly with titans of the sector such as Elon Musk's Tesla and BYD - a Chinese company that recently entered the private vehicle market in Mexico - as well as in a bet on them. as the future of mobility.

In fact, projections from Center Automotive Management point to a substantial acceleration in the adoption of electric cars, with an estimate of 10 million new registrations worldwide, representing an increase of 35% compared to 2022;

However, in Mexico, their adoption is very low compared to other markets. In our country, electric cars represented only 0.5% of national automobile sales last year, according to figures from the Mexican Association of the Automotive Industry (AMIA); well below the US percentage of 5.8%, according to research firm Motor Intelligence. If hybrids are added, Mexico reaches 4.7%. In total, almost 1.1 million new cars were sold in Mexico in 2022, of which only 5,600 were electric, far fewer than the 8,400 sold in Brazil, Latin America's largest car market. However, this is something that seems to intimidate BYD, which has big plans for Mexico.

Mexico: Fertile Ground for the Electric Vehicle Market!

BYD is the largest electric vehicle company in the world and reached the milestone of producing 5 million of these in August of this year , something that no other automotive company has achieved, not even Tesla. And his plans for Mexico are quite ambitious.

The company with origins in Shenzhen wants its first year in Mexico to culminate with 50 dealerships and the sale of around 5,000 cars by the end of 2023. At the same time, it is already planning the launch of three new vehicles for the Mexican market by the end of the year. (the Dolphin model on September 20) and early 2024.

Mexico, after Brazil, is the second most important market for us [in the Latin American region]. It is one of the largest automotive markets, selling around 1.2 million cars a year; In addition, electric vehicles are starting to become more popular in the country,” said Stella Li, global president of BYD in an interview with Business Insider Mexico .

In addition, in terms of its geographical position, Mexico is traditionally the great manufacturing center for the automotive industry. “As one of the main players in the automotive industry, Mexico is a very important strategic location for BYD,” he adds. BYD is also considering putting an assembly plant in Mexico — following Tesla's footsteps in Monterrey, Nuevo León—; However, this is still in the “exploration process” with seven states being considered for this.

BYD wants to position itself in the Mexican market with Affordable Electric Vehicles

The Chinese company already has more than 10 years of presence in Mexico, specifically within the truck and public transportation division. In fact, there are more than 600 BYD electric trucks circulating in the country, with companies such as Grupo Modelo, Bimbo, Coca-Cola, Heineken, Lala and Cemex being some of the Mexican companies that use them. In turn, BYD provided a fleet of around 50 electric trucks for Line 4 of the CDMX Metrobús and has 700 taxis with Venmo that also operate in the city.

However, the foray into the private vehicle market in our country seeks to fulfill a particular goal. The Chinese company seeks to take its philosophy of zero-emission mobility to a global level; This to provide anyone with the ability to purchase an electric vehicle and make their greatest goal of lowering the planet's temperature by 1°C a reality.

“Customers in Mexico have received us very well,” says Gustavo Lara, director of marketing and communication for BYD. "We have six open distributors, and the volume will grow exponentially by the time we have the 50 distributors we have planned for this year," he adds. The brand already has distributors in Mexico City, Guadalajara, and León, with upcoming openings in Monterrey, Cancún and other states. Lara adds that although the brand is aware that the adoption of electric vehicles is low in Mexico, its strategy consists of overcoming its main obstacle according to BYD: COST.

The strategy is to offer electric vehicles at a more accessible cost and complement the strategy with events where we communicate the technology [we have]. We also want to get closer through test drives and alliances with distributors like Liverpool », she adds. In addition to affordable vehicles, the company also relies on its technological experience to bring its products closer to Mexicans. Such is the case of the recent launch of BYD World, a virtual dealership that allows users to discover the Chinese brand's electric car offering from anywhere in the world.

BYD seeks to enter Mexico with Technology Beyond its Electric Vehicles

BYD began in 1995 as a rechargeable battery manufacturing company; However, over time it has grown to become a technological giant that has the automotive sector, rail transit, new energy, and electronics among its key industries. All these business lines could reach Mexico at some point, according to Stella Li.

"Mexico is one of the largest markets for BYD electric trucks, and I think that ultimately we will bring all the other products we have to the country," BYD's global president told Business Insider Mexico.

Lara confirms this idea; however, she says it will happen gradually. «The easiest thing to market today is a vehicle; the part of panels, mass storage batteries, trains, etc., it takes a little more time. We already have a presence around ​​trains in Uruguay and Brazil, the panels in Panama and Ecuador. We could offer this in Mexico without a problem, but as such the division we have today is commercial and passenger vehicles. "I wouldn't rule out that we enter Mexico here with other divisions," he says.

BYD also plans to implement robots with artificial intelligence that function as guides in places of interest such as museums or shopping centers. In fact, the brand confirmed to Business Insider Mexico that it plans to bring these robots to CDMX at the end of the year.

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