Chinese automaker SAIC Motor plans to build its first electric vehicle manufacturing plant in Europe in Spain’s Galicia region, marking a major expansion of its European operations.
The project involves an initial investment of €200 million and is expected to create more than 2,300 jobs while strengthening Spain’s position as a growing hub for electric vehicle manufacturing.
The move highlights accelerating Chinese investment into Europe’s EV industry as automakers seek to localize production and reduce exposure to EU import tariffs.
Key Overview
- SAIC Motor will build its first European EV factory in Spain
- The project involves a €200 million initial investment
- More than 2,300 jobs are expected to be created
- Construction is scheduled to begin in 2027
- Operations are expected to start by the end of 2028
- The plant will have annual capacity of 120,000 vehicles
- Galicia was selected as the project location
SAIC Expands Manufacturing Into Europe
Chinese automotive giant SAIC Motor will establish its first electric vehicle factory in Europe in Spain’s northwestern Galicia region, according to regional authorities.
The announcement was made by Alfonso Rueda, president of the Galician regional government, who described the project as a major strategic industrial investment for the region.
The facility will involve an initial investment of approximately €200 million ($232 million) and is expected to create more than 2,300 jobs locally.
Construction of the plant is scheduled to begin in 2027, with operations expected to start by the end of 2028.
The factory will be located between the port city of Ferrol and the nearby town of As Pontes.
According to officials, the facility is expected to produce up to 120,000 vehicles annually once fully operational.
The project will also include development of an industrial zone near the local port to support vehicle assembly and transportation activities.
Spain Strengthens Position as EV Manufacturing Hub
The investment further strengthens Spain’s growing position as a major European destination for electric vehicle manufacturing and clean energy-related industrial investment.
Analysts say Spain has become increasingly attractive to Chinese manufacturers because of its relatively low energy costs, expanding renewable energy capacity, and strong economic growth compared with many other European countries.
The country has also emerged as one of Europe’s key automotive manufacturing centers, supported by established supply chains and industrial infrastructure.
Regional authorities said the Galician government would accelerate licensing procedures to help move the project forward quickly.
While acknowledging that “a long road lies ahead” for the development, Rueda described the factory as a strategically important industrial project for the region.
He also thanked Spain’s central government for what he called “exemplary” cooperation in helping secure the investment.
Chinese Carmakers Expand Across Europe
SAIC’s investment comes as Chinese automakers continue rapidly expanding their presence across the European electric vehicle market.
The company has already established a growing footprint in Europe through its MG brand, which sells electric and hybrid vehicles across several European countries.
Industry analysts say Chinese manufacturers are increasingly looking to localize production inside Europe to avoid EU tariffs and reduce logistics costs.
The European Union currently imposes tariffs on Chinese-made electric vehicles amid concerns over subsidies and rising competition for European automakers.
Building vehicles inside Europe could allow Chinese manufacturers to bypass some import duties while strengthening supply chain resilience and improving delivery times.
Several Chinese EV brands have recently announced plans to establish manufacturing operations in Europe as competition in the global electric vehicle market intensifies.
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Europe’s EV Transition Accelerates
Europe remains one of the world’s fastest-growing electric vehicle markets as governments push toward stricter emissions regulations and long-term decarbonization goals.
European Union rules aim for 90 percent of all cars sold in the bloc to be electric by 2035, accelerating pressure on automakers to expand EV production capacity.
Analysts say this transition is creating significant opportunities for both European and Chinese manufacturers capable of scaling affordable electric vehicle production.
Chinese automakers have gained increasing market share in Europe in recent years, supported by competitive pricing, advances in battery technology, and expanding model ranges.
At the same time, European governments are balancing the need to attract industrial investment while protecting domestic manufacturing industries from intensifying foreign competition.
Political and Economic Ties Continue Growing
The announcement follows Spanish Prime Minister Pedro Sánchez’s four-day visit to China in April, highlighting strengthening economic relations between Spain and China.
Sánchez has visited China multiple times over the past three years as bilateral trade and investment ties continue expanding.
Analysts say Spain has positioned itself as one of Europe’s more open economies for Chinese investment, particularly in renewable energy, automotive manufacturing, and infrastructure sectors.
The closer relationship also comes during a period of increasing trade tensions between Europe and the United States under President Donald Trump’s administration.
Industry observers say European countries are increasingly seeking to balance strategic industrial policies with the need to attract foreign investment into emerging industries such as electric mobility and renewable energy.
Outlook
SAIC Motor’s decision to build its first European electric vehicle factory in Spain marks another major step in the globalization of China’s automotive industry.
The investment highlights Europe’s growing importance as a manufacturing and sales market for Chinese EV companies seeking to strengthen local production capabilities.
As electric vehicle demand continues rising across Europe, investments like SAIC’s Galicia factory are expected to intensify competition within the region’s automotive sector while accelerating Europe’s transition toward electric mobility.
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Sources: News.az, People’s Daily Online, Macau Business
