"Our plan is to build the factory for the Mexican market, not for the export market," stated Stella Li, CEO of BYD Americas.

Chinese manufacturer BYD is looking for a location in Mexico to set up a plant, Stella Li, CEO of BYD Americas, said Wednesday. The company hopes to select a site for the factory, which is expected to have a production capacity of 150,000 cars a year, by the end of the year, according to Li.

BYD surpassed Tesla in global electric vehicle sales in the fourth quarter, and automotive industry experts maintain that the Chinese manufacturer's attention to Mexico anticipates a competitive threat for companies already operating in the US market.

A U.S. manufacturing advocacy group, the Alliance for American Manufacturing, warned this month that Chinese cars and parts could jeopardize the viability of auto companies in the country. The group urged Washington to block the import of Chinese cars and parts from Mexico to avoid an "extinction level event" for the sector in the United States.

Li said BYD's aspirations in Mexico focus only on local sales, adding that the company is looking for locations in the central and southern areas of the country, rather than near the U.S. border, where she said Transportation costs to reach consumers would be high.

"Our plan is to build the factory for the Mexican market, not for the export market," he declared.

Asked if Mexican authorities had raised U.S. concerns about Chinese manufacturers, Li said they were receptive to BYD's plans.

Analysts say Chinese automakers are rapidly improving their vehicles and are advancing even faster than global rivals in some areas, such as infotainment systems and autonomous driving.