GAC Is the First Chinese Automaker to Announce a Plant in Mexico

Chinese automaker GAC (Guangzhou Automobile Group Co.) announced plans to begin assembling vehicles in Mexico in the second half of this year, becoming the first Chinese automaker to establish a production facility in the country. While GAC did not disclose the plant’s location or any investment details, it said in a press release that the facility will produce a mix of gasoline, hybrid, plug-in hybrid, and fully electric vehicles.

While the automaker said vehicles built in the plant will be limited to the Mexican market, it has not disclosed the factory’s expected annual output. GAC began selling vehicles in Mexico in late 2023, delivering more than 7,000 units its first year and 10,000 vehicles in 2025. Although we don’t yet know the plant’s location, signs point to GAC acquiring one of two Nissan facilities slated for closure in Mexico: the CIVAC plant in Cuernavaca, Morelos, or the COMPAS assembly plant in Aguascalientes. Both venues have the capacity to produce more than 160,000 vehicles annually.

“This announcement marks the start of a new operational phase and reflects the company’s broader growth ambitions in the region,” the automaker said in its press release. “The new operation strengthens GAC’s presence in Latin America and lays the groundwork for expanded production, research, and commercial activities. In the near term, the company will focus on meeting domestic demand as part of a long-term growth strategy.”

While that press release offered few additional details, GAC confirmed the plant will produce a range of vehicles including sedans, SUVs, pickup trucks, and crossovers. The move is part of the GAC’s “One GAC 2.0” global strategy, which aims to bring production closer to consumers while expanding its presence across international markets.

Mexico has become a key market for Chinese automakers. As of early 2026, more than 30 Chinese brands operate in the country, accounting for nearly 20 percent of the market. JAC—unrelated to GAC—already assembles vehicles locally, importing chassis and parts from China for final assembly in Mexico before selling the finished products domestically. GAC, however, plans to establish a more complete local supply chain.

Earlier this year, Mexico imposed 50 percent tariffs on vehicles imported from China, following pressure from U.S. President Donald Trump. By establishing local production in Mexico, GAC would be able to avoid those tariffs while creating jobs in the country.

GAC has partnerships in China with several automakers, including Toyota and Honda. The company also has an R&D center in Silicon Valley, California.

We expect to learn more details about GAC’s Mexico plant in June of this year.