SPAIN’S pivot to China has taken a major leap forward after Asian auto giant SAIC confirmed it will build a massive €200 million electric car factory in Galicia.
The Shanghai Automotive Industry Corporation, known as SAIC, has selected the region to host its very first manufacturing facility on European soil.
The sprawling industrial complex is set to be split between the naval city of Ferrol and the town of As Pontes.
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It will create 2,300 jobs for the region, including 1,000 direct manufacturing roles at Ferrol’s outer port and a further 300 logistics positions in As Pontes.
The landmark factory will produce 120,000 electric vehicles every single year for SAIC’s popular MG brand.
Construction is scheduled to begin next year, with the first vehicles rolling off the production line in 2028.
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The project has been fast-tracked after the regional Galician government granted the plan a special administrative status as a project of strategic interest.
The qualification will allow bureaucratic deadlines to be slashed in half to meet SAIC’s ambitious expansion timeline.
The decision to build in northern Spain comes as Chinese EV manufacturers scramble to establish a manufacturing foothold inside the EU.
By building vehicles locally, the company can avoid the punitive import tariffs slapped on foreign-made electric cars by Brussels.
Company chiefs spent months negotiating the deal with Spanish officials, embarking on 85 separate meetings and 25 site visits since October last year.
The deal was finally sealed following a high-level diplomatic trip to China in April to meet SAIC president Jia Jianxu and chairman Wang Xiaoqiu.
The plant will integrate advanced vehicle research and development, parts supply, and intelligent logistics into a single connected ecosystem.
William Wang, managing director of MG Motor UK and Europe, described the move as a historic milestone for the brand.
He said the facility would bring world-leading green technologies to Europe to support the transition towards zero-emissions mobility by 2035.
Spanish authorities are now racing against a tight clock to approve three crucial administrative procedures before any building work can begin in 2027.
The central government’s Council of Ministers must officially authorise the foreign investment, while local town halls must approve land concessions.
The company has vowed to prioritise local component suppliers to comply with strict EU rules on local manufacturing.
The industrial footprint is expected to mirror the massive automotive hub created by car giant Stellantis in southern Galicia.
But the decision by SAIC to establish its massive European production hub in Galicia comes at a time of deep geopolitical friction between Madrid and Washington.
The move highlights a perceived accelerating diplomatic realignment under Prime Minister Pedro Sanchez, who has actively courted Chinese investment while relations with the USA have deteriorated.
Tensions between the two nations have escalated sharply following the return of Donald Trump to the White House.
The US administration has repeatedly locked horns with Madrid over trade policy, with Donald Trump reportedly branding Spain a ‘loser’ during heated disagreements over transatlantic tariffs.
Sino-Spanish relations have surged in contrast, cemented by a high-level official trip to China by regional leaders in April to finalise the vehicle plant with SAIC automotive chiefs.
This economic pivot away from Washington and towards Beijing carries significant risks for Spain’s standing within the Western alliance.
Senior diplomats warn that a deepening reliance on Chinese state-backed industrial giants could trigger severe economic repercussions from the USA, particularly in the form of retaliatory trade barriers on traditional Spanish exports.
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The geopolitical shift also risks fracturing relations within the NATO alliance, where Washington has consistently pressured European partners to decouple their supply chains from Beijing over national security concerns.
The country also hosts major strategic American military installations, including the Rota Naval Base in Cadiz and the Moron Air Base in Sevilla.
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