BYD, Tesla set to lose most from Mexico’s proposed tariffs on China

ELECTRIC car rivals BYD and Tesla are set to be the biggest losers from Mexico’s proposed 50% tariff on autos imported from China, triggering a likely blow to the fast-growing electric car market in Mexico while sparing the traditional “Big Three” US car manufacturers.

- 

The proposed tariff, announced on Wednesday, targets electric and gasoline cars imported from all countries that Mexico doesn’t have a free trade agreement with, including South Korea, India, Indonesia and Russia. In practice, however, the tariff would mostly impact electric cars manufactured in China and sold in Mexico, industry analysts said.

The levy has the potential to reshape North America’s fastest-growing car market and put the brakes on BYD’s meteoric rise in Mexico, analysts said.

Over the last year, Mexico has raised tariffs on Chinese-manufactured electric vehicles from 0% to 15% and now 50%, said Eugenio Grandio, president of the Electric Mobility Association in Mexico.

“It’s definitely a game-changer,” Mr. Grandio said. “Fifty percent [tariff] is a very aggressive number.”

The plan still needs to be approved by Mexico’s Congress, where President Claudia Sheinbaum’s Morena party has a significant majority.

While the proposed tariff appears to be sweeping in nature, it would actually spare legacy US automakers — General Motors, Ford and Stellantis — under a 2003 decree.