Chinese automakers are moving in. BYD, Geely, Chery, MG, CATL, and Leapmotor are setting up production and battery plants in Spain, sidestepping EU tariffs and changing the face of the country’s car industry.
BYD’s hunt for a new European assembly plant has put Spain in the spotlight. The Chinese company is already building its first European factory in Hungary. Now it is looking at Spain and France for its next big move. BYD may buy and overhaul an existing Spanish plant. This is a shift: Chinese electric car makers are no longer just shipping cars to Europe. They want to build them here. Reuters reports that BYD is talking with officials and carmakers in Spain, France, and Italy about taking over underused factories. The company expects to pick a site by the end of 2026.
The timing is tough for Brussels. The European Union has slapped tariffs of up to 35.3% on electric cars imported from China. The goal is to protect local carmakers from what the EU calls unfair subsidies. But these tariffs only hit cars shipped from Asia. If Chinese brands build inside the EU, the rules change. Spain’s strong car industry makes it a top target. Analysts told Reuters that Spain’s mix of spare factory space, cheap energy, and skilled workers is drawing Asian carmakers who want to dodge tariffs and make cars closer to European buyers.
BYD’s European strategy now includes plans for three assembly plants and one battery factory, not just a single facility.
Deals are already changing Spain’s car landscape. In Valencia, Ford and Geely have teamed up to restart the Almussafes plant. Ford keeps a 66% stake. Geely takes 34% and is putting in €221 million. The plan is to launch five models, including two Geely electric cars. Production should start in 2027, with new cars rolling out in 2028. The plant could make up to 500,000 cars a year. Spanish business media say Jeff Jones will be president of the new Ford-Geely joint venture. The deal is now official.
In Barcelona’s Zona Franca, once Nissan’s ground, a Spanish-Chinese partnership is taking shape. Ebro owns 60%, Chery 40%. They have already put in over €150 million to restart the lines. The goal is up to 200,000 cars a year. A Chery electric model is set to join the lineup. Here, Spanish market access meets Chinese tech and production power. Industry reports call the Zona Franca project a showcase for how Spain’s supplier network and infrastructure help Asian carmakers set up shop.
Galicia is next. MG, owned by China’s SAIC, picked the region for its first mainland European plant. The investment is €200 million, with 2,000 jobs planned. The target is 120,000 cars a year by 2028. The push goes beyond finished cars. In Zaragoza, CATL and Stellantis are building a battery gigafactory. The price tag: €4.1 billion. The goal: 50 GWh capacity and over 4,000 direct jobs by late 2026. Leapmotor, part-owned by Stellantis, is making battery modules in Mallén and getting ready to build its B10 electric SUV in Figueruelas. This marks a shift from simple partnerships to a lasting industrial base.
The current surge of Chinese interest in Spain is directly linked to EU tariffs on electric vehicles imported from China. These trade barriers do not apply to vehicles produced within the EU, prompting Chinese automakers to accelerate local investments and partnerships.
The wave of Chinese investment is getting attention outside Europe too. The Ford-Geely deal has drawn fire from the US. The Trump administration has warned about the risks of relying on Chinese tech. Ford has defended its Spanish deal, showing how global the stakes have become.
Spain’s draw is clear: a strong car sector, skilled workers, and suppliers ready for new business. For Chinese brands, building locally means getting closer to European customers and avoiding import tariffs. The timing works. In August, pure electric and plug-in hybrid cars made up 27.7% of Spanish car registrations. Between January and August, 185,339 electrified cars were sold in Spain, up 34% from last year.
This is more than just more Chinese cars on Spanish roads. The factories themselves are changing. The old model—shipping cars from Asia—is fading. Now, Chinese money, tech, and know-how are being built into Spain’s car plants.
As reported earlier, Chinese brands are already gaining ground with models like the Lynk & Co 08 EM-P. But the real fight is moving from the showroom to the factory floor. BYD may soon build in Spain. Geely is already in Valencia. Chery is producing in Barcelona. MG is setting up in Galicia. CATL is powering up in Zaragoza. The industrial map is changing fast.
Europe faces a tough choice. Tariffs are meant to protect local industry. But Europe needs new investment, jobs, and more production to speed up its own electric shift. As Chinese carmakers become part of Europe’s industry, the line between rival and partner gets blurry. Spain is now at the center of this change. The country stands to gain from new money and tech, but must also guard its long-term control over its factories. The next stage of Europe’s electric car race will play out not in boardrooms, but on the factory floors of Valencia, Barcelona, Galicia, and Zaragoza.
