General Motors to Produce Aveo and Groove in Mexico After China Tariffs

Mexico City — General Motors will locally produce the Chevrolet Aveo and Groove, two high-volume models previously imported from China, as part of a $1 billion investment package in Mexico.

The decision comes amid escalating trade pressure on Chinese vehicles. Since January, Mexico has imposed a 50% tariff on imports from China, eroding the competitiveness of price-sensitive, mass-market models.

“We will be assembling two favorite models locally. Starting in 2027, the Chevrolet Groove, and later we will add our Chevrolet Aveo,” said Francisco Garza, CEO of General Motors in Mexico.

Garza said the initial goal is to reach production of 80,000 units during the first year of both programs.

The Aveo and Groove compete in high-volume segments where small price changes can quickly shift consumer preference. Keeping both models imported would have meant higher costs and pressure on margins and prices, the company said.

By moving production to Mexico, GM aims to reduce tariff exposure and strengthen its local manufacturing base. The investment is part of a broader plan announced early last year to boost manufacturing operations in Mexico through 2027.

The move aligns with the federal government’s Plan Mexico, which seeks to strengthen national production and increase local content in manufacturing.

President Claudia Sheinbaum said the project reflects the industry’s proactive response to changing global trade rules and will help keep Mexico’s production capacity active.

“It’s great news because it means Mexico is acting quickly, that we are going to maintain our productive plant, and that the changes in global rules have already been anticipated, so today we can have this announcement, which is good news for everyone,” Sheinbaum said.

The announcement also comes amid growing trade pressure from U.S. President Donald Trump, whose tariff policies have begun reshaping the automotive investment and production map in North America.