Nissan Left, Chinese Capital Arrives! European Auto Transformation: Spanish Defense Ministry Approves SAIC's Investment to Build Factory

A spokesperson for the Spanish Ministry of Defense said Tuesday (August 11) that the department does not object to Chinese automaker SAIC Motor's plan to build a car factory in the Galicia region. According to government sources, the Chinese project still requires approval from the cabinet and the Strategic Investment Committee, which will set security requirements for the project.

Under the plan, SAIC will invest €200 million in the factory, begin construction next year, and commence production in 2028, primarily manufacturing new-energy MG-branded vehicles with an annual output capacity of up to 120,000 units. The facility is expected to create 1,000 jobs.

Reuters cited reports from Spain's El Mundo and El País on Monday stating that Spanish intelligence agencies had internally flagged security risks associated with the project. The proposed factory site is just 5 kilometers from the port of Ferrol, a key naval base housing F-100 frigates participating in NATO missions. Media reports indicate military officials are concerned the Chinese company could collect sensitive data on routine ship movements.

The regional government of Galicia, Spain, said Defense Minister Margarita Robles pledged her support for the project during the cabinet review on Tuesday. The Spanish Ministry of Defense stated it has participated in months of negotiations with SAIC Group regarding the project and has raised no security concerns.

SAIC Motor is one of several Chinese automakers and battery manufacturers establishing operations in Spain. Chery Automobile recently began producing the Omoda 5 at the former Nissan plant in Barcelona. Leapmotor is manufacturing the B10 compact SUV at Stellantis' plant in Zaragoza. Following the closure of aging auto plants across Spain, these Chinese-backed enterprises have contributed to economic recovery in certain regions.

Chinese automakers are currently expanding their production capacity in Europe. BYD has begun trial production at its plant in Szeged, Hungary. Germany is also discussing the possibility of Chinese companies utilizing idle production facilities.

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