Mexico has just one assembly plant for Chinese cars, but its chief executive officer isn’t sweating Donald Trump’s tariff threats.
Elias Massri is chairman of the board and CEO of Giant Motors Latinoamérica, a Mexican joint venture between the Massri family and billionaire Carlos Slim’s Grupo Financiero Inbursa, that assembles Anhui Jianghuai Automobile Group Corp. vehicles at its facility in central Mexico.
Giant Motors’ Ciudad Sahagún, Hidalgo, the plant is an example of the alleged Chinese encroachment into Mexico’s key industries such as autos and electronics that has riled Trump. The president-elect has threatened to stop this by imposing an additional 10% tariff on goods from China and 25% tariffs on all products from Mexico and Canada.
That has put pressure on the government of Claudia Sheinbaum to halt Chinese investment. But if Trump is hoping for an easy win, he may be surprised by the resilience of firms like Massri’s Giant Motors.
“If they change the rules, we are ready to play by them,” said Massri from his offices in Mexico City’s business district Santa Fe.
The silver-haired Mexican executive said that his nearly two-decade-old company had already weathered the first wave of Trump tariffs in 2018, a global pandemic in 2020, and helped usher in a wave of Chinese auto investment after establishing the first and only plant that assembles Chinese vehicles in Mexico.
“There have already been many battles, and we have not stopped investing what is required and earning profits,” he said.
Giant Motors began producing about 8,000 JAC vehicles in 2019 in Mexico. After recuperating from the pandemic, it doubled in volume in 2021. Giant Motors was helped in large part by the fact that JAC was unaffected by the global chip shortage due to its extensive supply chain.
According to Massri, should the company face new tariffs it could source components and auto parts from countries with favorable trade terms.
“There are free trade agreements in Mexico with many parts of the world that do not fall into this situation,” he said.
After Giant Motors began selling JAC cars in Mexico in 2017, wary Mexican consumers became more open to buying Chinese vehicles, since the models showed advancements in quality and technology, said Massri. That helped bring brands like BYD Co., SAIC Motor Corp Ltd., Chery Automobile Co. Ltd, and Great Wall Motor Co Ltd. into Mexico, and many of them have announced plans to open plants in the country.
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That trend raised alarm bells in Washington, with some US and Canadian government officials expressing concerns that Chinese cars could enter the US using Mexico as a back door.
And as a result, investments have stalled. BYD halted plans to build its plant in Mexico until after the US elections. Last month, Sheinbaum said the government has not received a “firm” proposal to build an electric vehicle car plant from any Chinese company.
Such concerns, however, do not worry Massri. Giant Motors’ ambitions are narrowly focused on the Mexican market, and the company will not be poking the bear by attempting to export vehicles to the US, he said.
Instead, the strategy of Giant Motors has been to “Mexicanize” its Chinese cars in the country. The company buys completely knocked-down kits from JAC in China and adjusts the design of the cars and trucks at its plant to meet the needs of the local market. This includes constructing vehicles with higher suspension and powerful motors for Mexico’s hilly terrain and potholed roads, Massri said.
Giant Motors expects to produce 30,000 vehicles by the end of 2024, and some 40,000 next year. The plant’s installed annual capacity is 60,000 vehicles. In addition to growing production, Giant Motors has four new models for 2025, and it’s constructing a logistics center near the Hidalgo plant.
“We are not satisfied with our size,” said the smiling Massri. “We want to be bigger.”
TYT Newsroom
