Automakers Ford and Tesla are both planning to build new factories in China, but for very different purposes. In Ford’s case it has decided to build the next generation Focus at a new factory in China from the second half of 2019. The vehicles will be, in part, exported for sale in the United States. That replaces a planned factory in Mexico, with the move justified by a lower cost of production.

Panjiva data shows Ford’s exports of completed autos from Mexico to the U.S. fell 21.9% on a year earlier in the three months to April 30 despite a surge in April. As outlined in Panjiva research of June 2 it faces, at least in the short-term, a slowdown in sales in the U.S.

Chart shows exports from Mexico of completed autos (HS 8703) segmented by name of exporter ( Ford, General Motors, Fiat Chrysler. Source: Panjiva

In Tesla’s case a move is designed to improve access to a fast growing market, Bloomberg reports. Currently exporters have to pay a 25% tariff. While a local factory would avoid this, it would require a local manufacturing partner. One area of efficiency may be to also include a “gigafactory” battery manufacturing plant at the same time. That would avoid the need to export batteries, one of the bulkier items required in the manufacturing process.

Imports by Tesla’s Beijing distributor increased 53.5% on a year earlier in the three months to April 31, reaching $251 million including completed vehicles and parts. If continued for the rest of the second quarter that would leave China at 9.5% of global revenues, a similar level to a year earlier.

Chart compares imports by Tesla Sales Beijing to Tesla Inc. revenues, based on data from Reuters. Source: Panjiva