“Made in China” is becoming “Made by China” all over the world.
Faced with high Western tariffs and weak demand domestically, many Chinese factories are moving overseas, making everything from appliances to automobiles everywhere from North and South America to Eastern Europe.
More Chinese companies may come to America after President Trump and Chinese leader Xi Jinping An agreement was reached in Beijing A new bilateral “investment board” will be set up this month.
Yet many leaders, particularly in the US and Europe, worry that Chinese businesses are bringing China’s brutal rat-race competition with them, potentially crushing local incumbents and curbing wages.
Chinese battery maker Goshan had planned to build a $2.4 billion plant in Michigan, but the project has since been put on hold. years of local protest On the company’s Chinese roots. Another Chinese battery maker, CATL, had to settle To license its technology to companies like Ford, which is building a $3 billion plant in Michigan to make CATL-designed batteries.
In Brazil and Hungary, electric-vehicle seller BYD has been dogged by complaints that Chinese migrant workers hired to build its factories were subjected to labor rights violations, including what Brazilian officials called slavery-like conditions. Some EU officials fear BYD’s new plant in Hungary could weaken carmakers across the continent, threatening an industry It accounts for 7% of the EU’s economic output and 13 million jobs.
BYD says it has stopped working with its contractor for the Brazil factory and has no tolerance for violations of human rights and labor laws in its operations. It also said its Hungary business would create thousands of jobs, boost the local economy and support local supply chains.
“Our goal is to become a more global manufacturer,” Stella Li, BYD executive vice president, said at a conference this month. “Building more capacity overseas is a trend, that’s the business plan.”
CATL also has ongoing projects in Hungary, Indonesia and Spain. Home appliance maker Midea, which has built production facilities in Brazil and Thailand, recently announced a partnership with Stockholm-based Electrolux to jointly run manufacturing operations in South Carolina and Mexico.
While local leaders often welcome such investments, critics fear that China’s manufacturers could gain access to lucrative consumer markets without creating local jobs or economic value for the companies they threaten to replace.
several dozen Democratic lawmakers recently requested Trump stops Chinese automakers from making cars in America and calls for ban on Chinese cars made in mexico Or Canada, saying, “We should not cede the American auto industry to a strategic competitor intent on global dominance.”
Details of the new US-China Investment Board remain scant. A senior US official said during the recent Trump-Xi summit in Beijing that it would allow both governments to consider Chinese spending plans in the US and would not interfere with existing institutions that scrutinize investments for national-security risks, such as the Committee on Foreign Investment in the US.
Some economists say it will be difficult to keep away Chinese manufacturers. For decades China produced most of what the world consumed within its vast borders, its factories Now have to face exceeding capacityCut-throat competition and weak domestic consumption. that is prices went down And profits declined, making owners wary of investing at home and eager to expand abroad.
Last year, Chinese outward direct investment increased by 7.1% from a year earlier. Domestic investment fell 3.8%, the first annual decline on record, according to government data.
going abroad
Economists say that in the long term, China’s push to expand its factories around the world could cement its position as a dominant power in global manufacturing. Chinese businesses call it chuhai in Mandarin, which means “going abroad.”
Some policymakers believe the investment could help reinvigorate local manufacturing industries. When Japanese car manufacturers expanded into the US in the 1980s and 1990s, it forced American car manufacturers and suppliers to adopt new approaches, which ultimately made those companies more flexible and benefited car buyers.
In Mexico, Chinese investment in industries such as the automobile sector could create more than 100,000 jobs from 2020 to 2023, according to a Analysis.
“We need more Chinese foreign direct investment in some key sectors in Europe, to contribute to our development, to transfer some technologies and not just export to Europe,” French President Emmanuel Macron said at the World Economic Forum this year.
In 2024, China’s top car exporter Chery Automobile helped save a small factory in Barcelona that struggling Japanese automaker Nissan no longer wanted. It took a 40% stake in a joint venture, investing 400 million euros, equivalent to $468 million, to restart production under the historic Spanish brand Ebro.
For the locals, the venture has been a success. It directly employs about 1,600 employees, many of whom had already been laid off. It has set a record for growth for a car brand in Spain, sending shares of Ebro EV Motor, the startup that controls the joint venture, higher.
But EU Executive Vice President Stephane Széjourn has criticized the arrangement, arguing it would not help European industry. Under the hood, the technology and parts are primarily from China, although Ebro wants to increase the share of local content over time.
Szern is the driving force behind an EU plan to require certain products, including cars, to contain a certain share of European components in order to qualify for public procurement or support.
The initiative, launched in March as the Industrial Accelerator Act, also adds foreign direct investment from China in sectors such as EVs, batteries and solar panels, valued at more than €100 million, equivalent to $116 million.
If the Act makes it into law through the EU legislative process, Chinese companies in these sensitive sectors would have to commit to hiring locals for at least half of their European workforce, and pledge to transfer technology and buy European parts.
Cherry did not respond to requests for comment.
increasing tension
Several Chinese carmakers are in discussions with European rivals about using their factories to produce vehicles locally for the European market. jeep manufacturer stellaris said this month Planned to make EV with two different Chinese companies In Spain and France. Ford and Geely are discussing a possible similar deal in Spain, and also discussed Can cooperation be extended to America
Renting out excess factory space helps struggling European carmakers cover their high overheads. But analysts worry it would give Chinese manufacturers an easier way to enter Europe, potentially bringing the level of intense competition in China’s auto market to Europe.
Local people have also expressed other concerns. In Hungary, residents and environmental groups protested the arrival of CATL and other battery manufacturers, concerned about the environmental impacts of the projects.
In Brazil, officials alleged last year that some Chinese workers hired to build BYD’s factory worked seven days a week and slept on beds without mattresses. They found that one dormitory had one toilet for 31 people.
Kelly Rao, founder of JumpStart Asia Consulting, a Georgia-based staffing firm that works with Chinese companies investing in the US, said Chinese companies often struggle to adapt to local norms, especially labor practices. Working overtime is common in China, but it is strictly regulated in the US
“You can’t use the Chinese method,” Rao said.
equipment abroad
Midea, a home appliance manufacturer, became one of the world’s largest manufacturers of air conditioners and other appliances after its founding in southern China in 1968, mostly making products for other brands.
But it wasn’t until late 2023 that it actually committed to selling products under its own brands and growing overseas, a strategy aimed at making Midea more resilient in the face of global trade tensions.
It opened a nearly $100 million factory making refrigerators and washing machines in Brazil in 2024. Its subsidiary, Welling Auto Parts, opened its first overseas manufacturing facility in Mexico last year.
“Domestically, incremental growth has stalled, stock growth is declining and there is a flood of new competitors,” Midia Chief Executive Paul Fang said in an interview with Chinese publication LatePost in 2025. “So we must look outward.”
Foreign sales of media have increased. For Western competitors, this means greater tensions, reducing their profits and forcing some to consolidate or exit certain markets.
Electrolux, which makes Frigidaire brand refrigerators, has lost market share over time to Chinese companies in the home appliance industry. Its recently announced joint venture with Midea is designed to help it grow its North American business by using Midea’s manufacturing know-how to gain share in the high-margin laundry category and improve the cost-competitiveness of its refrigeration products.
In return, Media gets a bigger foothold in America
Write to Hannah Miao hannah.miao@wsj.com and on Stephen Wilmot stephen.wilmot@wsj.com
