The Spanish Ministry of Defence has informed the Xunta de Galicia that it will not oppose construction of a Chinese electric-vehicle factory in Ferrol, A Coruña, despite the proposed site’s proximity to one of Spain’s major naval complexes. Defence Minister Margarita Robles conveyed the position to Galician president Alfonso Rueda, clearing a impressive obstacle for SAIC Motor’s proposed plant. The project still needs authorization from Spain’s Council of Ministers under the foreign-investment review process.
Security concerns centred on the site at Ferrol’s outer port, about five kilometres from the naval base complex, which includes the arsenal, and the Navantia shipyard. The site is close to infrastructure that supports Spain’s military shipbuilding and defence activity. Spanish reporting has attributed concern to the Ministry of Defence over possible espionage risks linked to a Chinese-owned facility near sensitive infrastructure. The government’s reported approach is to allow the investment to proceed with any necessary security conditions, rather than reject it outright.
The clarification follows a period of political tension, with military and intelligence warnings prompting questions from the Xunta and Sumar, the junior partner in the national governing coalition. Galicia’s economy and industry minister, María Jesús Lorenzana, said the Council of Ministers was expected to authorize the foreign investment within “pocas semanas” (“a few weeks”). The Xunta has backed the project as a strategic industrial initiative, while its progress and timetable have also been affected by the calling of regional elections.
SAIC Motor, the Chinese state-owned automotive group and parent company of MG, has selected Ferrol’s outer port for its first European vehicle-assembly plant. The proposed first-stage investment is €200 million, with construction expected to begin in 2027 and production targeted before the end of 2028. The facility is planned for a site of about 100,000 square metres and would initially assemble vehicles from kits. Industry reporting has identified the MG Go as the first model. The project focuses on electric and hybrid MG vehicles.
Initial annual output is reported at roughly 70,000 vehicles, with capacity able to grow to as many as 120,000. The plant is expected to create around 1,000 direct jobs, while broader estimates put direct and indirect employment across Ferrolterra above 2,000. A related logistics centre in As Pontes is reported to create about 300 jobs. Spanish reporting has also described possible later phases that could raise total investment to €500 million and employment to as many as 5,000 positions.
Both the Spanish and Galician governments have promoted the project despite their different political affiliations. Prime Minister Pedro Sánchez raised the investment during a visit to China, while Rueda travelled to Asia to advocate for Ferrol as the preferred location. In July, SAIC executives visited Galicia, met the regional president and conducted a trial unloading of 700 vehicles at the port. Local assembly would give the company a European manufacturing base for MG-branded vehicles. Galicia presents the plan as a way to diversify an economy shaped by shipbuilding and heavy industry.
Political figures from the PP and Sumar have questioned whether the security debate may also reflect wider commercial and geopolitical interests. Ferrol mayor José Manuel Rey Varela, who chairs the Senate Defence Committee, suggested possible business motivations, while Sumar’s Enrique Santiago linked the warnings to broader US-China economic and military competition, including possible NATO-related considerations. For further background on the initial security debate and its implications, see this detailed report on the earlier defence concerns.
The investment is among the most impressive industrial proposals for Galicia in recent years. Ferrolterra has faced persistent economic pressure amid the long-term decline of heavy industry and changes to the naval sector. Supporters see SAIC’s plan as an chance to create jobs and strengthen the local industrial base by attracting suppliers; critics focus on the tension between those economic aims and the plant’s proximity to defence and shipbuilding assets. Defence’s stated position clears one hurdle, but implementation still requires basic-government authorization and may carry security conditions.
