Shanghai-based Yongmaotai announces US $63M auto parts plant in Coahuila

Chinese institution Yongmaotai Automotive Technology has announced an concern of astir US $63 cardinal to physique an car parts works successful the bluish borderline authorities of Coahuila.

The Chinese quality outlet Yicai Global archetypal reported the planned concern successful July, saying that Yongmaotai had announced its volition to walk 450 cardinal Chinese yuan (US $63.1 million) connected a caller mill successful Mexico successful bid to “mitigate the interaction of shifting planetary commercialized policies connected its European and U.S. customers’ proviso chains.”

Yicai Global said that Yongmaotai, a Shanghai-based institution that specializes successful the accumulation of aluminum car parts, announced that its 2 Singaporean units would jointly acceptable up “a Mexican task company” to put successful the caller works and oversee its operation and operations.

Yongmaotai said that the mill would apt instrumentality 2 years to build.

In September, the Mexican Chamber of Commerce successful China (MEXCHAM) described the planned task arsenic “a astute manufacturing basal for automotive parts successful Mexico.”

MEXCHAM said that the task is located successful Coahuila, but didn’t specify wherever successful the state.

It said that the works volition person “a planned yearly accumulation capableness of 25 cardinal lightweight automotive parts, including turbocharger housings.”

MEXCHAM besides said that “the operation play is expected to beryllium 2 years, with accumulation acceptable to statesman successful the 2nd 4th of 2027.”

It said that according to Yongmaotai’s “2025 semi-annual report,” the task has “already been successfully initiated.”

“Approval and filing procedures are presently underway successful China, Singapore and Mexico, portion the registration of the Mexican subsidiary is besides successful progress,” MEXCHAM said connected Sept. 18.

China launches commercialized probe into Mexico’s planned tariff hike

The concern enclosure noted that “Mexico enjoys zero-tariff benefits for car parts exports to the United States” arsenic it is enactment to the USMCA escaped commercialized pact, which is scheduled to beryllium reviewed successful 2026.

MEXCHAM said that Yongmaotai’s concern determination “not lone represents a important measurement successful the company’s planetary strategy but besides injects caller vitality into China-Mexico automotive manufacture cooperation.”

Yongmaotai could debar US and Mexican tariffs by manufacturing successful Mexico

According to Yicai Global, Yongmaotai said successful July that the concern successful Mexico volition “help trim the adverse effects of changing planetary tariff policies” connected the proviso chains of its clients successful Europe and the United States.

Having a works successful Coahuila would let Yongmaotai to debar tariffs connected Chinese goods imposed by the United States, provided that those parts comply with USMCA rules, which could perchance alteration aft adjacent year’s review.

It would besides let Yongmaotai to debar Mexico’s tariffs connected goods from China, which are slated to emergence successful the adjacent future.

The institution supplies parts to automakers, including General Motors and Volkswagen, some of which manufacture vehicles successful Mexico, a large auto-producing country, and successful the U.S.

Yongmaotai has besides announced a program to physique a $50 cardinal works successful Indonesia arsenic portion of a strategy to diversify its manufacturing base.

More than 30 Chinese car parts manufacturers already run successful Mexico, the bulk of which export their products to the United States. Some were reportedly lured to Mexico by Tesla, which successful aboriginal 2023 announced a program to physique a “gigafactory” adjacent Monterrey, Nuevo León.

However, it presently appears improbable that Tesla volition really physique its projected works successful Mexico. In July, Chinese electrical conveyance shaper BYD, Tesla’s main competitor, canceled its plans to manufacture vehicles here.

Politicians successful the United States and Canada person made captious remarks astir Chinese concern successful Mexico, which has accrued successful caller years.

United States President Donald Trump has floated the anticipation of imposing hefty tariffs connected cars made by Chinese companies successful Mexico, a determination aimed astatine dissuading Chinese automakers from opening plants here. He has besides said that helium wants to “renegotiate” the USMCA, alternatively than simply reappraisal the pact helium signed disconnected connected during his archetypal word arsenic president.

With reports from Vanguardia, Cluster Industrial and Yicai Global