SAIC to increase manufacturing capacity in Spain
SAIC – China’s second-largest automaker – is building a EUR 200 million auto plant in Galicia, Spain (Reuters).
- The plant – which will primarily manufacture EVs – is expected to produce up to 120,000 vehicles annually under the MG brand when it comes online in 2028 (Leifeng).
Some context: Amid warming bilateral relations, Spain has overtaken Hungary since 2024 as the preferred destination for Chinese automakers looking to localize production in Europe.
- BYD, Geely, Chery, Chang’an, and Leapmotor have either announced local manufacturing plans or are reportedly evaluating projects in the country.
More context: MG was the first Chinese auto brand to establish a large-scale presence in Europe, but its growth momentum took a hit in 2024 when SAIC’s EV exports were hit with a 48.1% tariff following the European Commission's anti-subsidy investigation.
- Growth has since rebounded as SAIC ramped up exports of plug-in hybrids to circumvent prohibitive EV tariffs.
- With 300,000 units sold in 2025, roughly the combined total of BYD and Chery, MG is by far the most successful Chinese auto brand in Europe.
Get smart: Chinese OEMs’ collective pivot toward plug-in hybrids is an effective short-term workaround but carries substantial risks, with Brussels signaling that it could act to close the tariff loopholes.
- For those seeking a durable presence in Europe, localization is the only viable long-term strategy.
What we’re pondering: Will these inbound investments satisfy – or circumnavigate – Brussels’ increasingly stringent industrial policy requirements?