MG Expands European Manufacturing Footprint with New Spain Vehicle Plant

Chinese automaker MG, a subsidiary of SAIC Motor, has announced plans to establish its first manufacturing facility on the European mainland in Spain. The project represents a significant step in the company's long-term strategy to deepen its presence across Europe through localized production and supply chain development. The facility will be located in Galicia and is expected to serve as a major industrial center supporting MG's expanding operations in the region.

The company plans to invest approximately €200 million ($233 million) in the new facility. Production is scheduled to begin in 2028, and the plant is designed to deliver an annual manufacturing capacity of 120,000 vehicles. MG stated that the project is expected to generate more than 2,000 jobs, contributing to regional economic development while supporting the company's future growth plans across European markets.

Key Details of MG's New Spain Manufacturing Facility

The upcoming production site will integrate multiple operational functions to create a comprehensive automotive manufacturing ecosystem. The facility is intended to bring production activities closer to customers while enhancing sourcing and logistics capabilities throughout the region.

Localization Strategy Drives Expansion

According to MG, the new facility will combine vehicle production, research and development, component supply operations, and intelligent logistics systems within a single industrial hub. This integrated approach is expected to improve operational efficiency, shorten supply chains, and increase the level of localized sourcing. The company also plans to strengthen collaboration with European suppliers and business partners as part of its broader regional development strategy.

Industry observers believe that battery electric vehicles are likely to account for a significant portion of the plant's output. Establishing local manufacturing operations could also provide greater flexibility in responding to trade policies affecting imported vehicles. By increasing production within Europe, MG can potentially reduce exposure to tariffs and other barriers while improving responsiveness to market demand.

Strong Sales Momentum Supports Investment

The expansion follows a year of robust performance for MG in the European market. In 2025, the brand recorded sales of 307,000 vehicles across Europe, representing a 26% increase compared with the previous year. The achievement made MG the only Chinese automotive brand ranked among the top 20 vehicle sellers in the region.

MG's European leadership had previously indicated that local manufacturing would become financially viable once annual sales surpassed the 300,000-unit threshold. The latest sales figures have now provided the scale required to support a major production investment. Earlier in the year, the company also celebrated the delivery of its one-millionth vehicle in the European market, highlighting the rapid growth of the brand since its return to the United Kingdom market in 2011.

Expanding Product Portfolio Across Europe

To sustain future growth, MG has continued to broaden its vehicle lineup in Europe. Recent introductions include the MG4 EV Urban and the all-new MG9, the company's first seven-seat plug-in hybrid SUV. These additions reflect MG's strategy of serving a wider range of customer preferences while strengthening its position in both electric and electrified vehicle segments.

The brand currently operates through a network of more than 1,300 dealerships spanning 34 European countries. The extensive distribution footprint has played a crucial role in supporting sales growth and enhancing brand visibility throughout the region.

Spain Emerges as a Strategic Automotive Hub

Spain continues to attract investment from international automotive manufacturers due to its well-established industrial base and strong manufacturing capabilities. The country's position within the European automotive ecosystem has made it an increasingly attractive destination for companies seeking localized production capacity.

MG is not alone in selecting Spain as a strategic expansion location. Chery has also partnered with Spanish automaker Ebro to support vehicle production activities in Barcelona. These developments underscore Spain's growing role as a gateway for automotive companies seeking to expand their presence across Europe.

Commenting on the project, William Wang, Managing Director of MG Europe, stated that the investment in local capabilities, stronger regional operations, and a more competitive automotive ecosystem would help accelerate Europe's transition toward smarter and more sustainable mobility solutions.

Frequently Asked Questions

Why is MG building a vehicle manufacturing plant in Spain?
MG is building the facility to expand localized production in Europe and strengthen its regional supply chain capabilities. The new plant will help the company manufacture vehicles closer to customers, improve cooperation with European suppliers, and support future sales growth. Local production may also provide greater flexibility in responding to trade regulations and market conditions while reinforcing MG's long-term commitment to the European automotive market.

What is the planned production capacity of MG's Spain facility?
The new Galicia plant is expected to have an annual production capacity of 120,000 vehicles when operations begin in 2028. The facility will integrate manufacturing, research and development, component sourcing, and intelligent logistics functions. Industry reports suggest battery electric vehicles could account for a significant portion of output, although MG has not yet disclosed detailed production plans for specific vehicle models.

How has MG performed in the European market recently?
MG achieved strong growth in Europe during 2025, recording sales of 307,000 vehicles, representing a 26% year-on-year increase. The brand became the only Chinese automaker to rank among the top 20 vehicle sellers in the region. Earlier in the year, MG also celebrated the milestone of delivering one million vehicles in Europe, reflecting its rapid expansion since re-entering the market in 2011.