Chinese electric vehicle giant BYD is planning to build a third factory in Europe, expanding its manufacturing footprint beyond its current projects.
The world's largest EV manufacturer is seeking to strengthen its European presence as it navigates tariffs imposed by the EU on Chinese-made electric vehicles last year.
The move represents another step in BYD's aggressive global expansion strategy, which has seen it overtake Tesla sales.
Speaking in Frankfurt, BYD Executive Vice President Stella Li said a decision on the location for the third European plant could come within the next 18 to 24 months.
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BYD is looking to set up a third manufacturing factory in Europe
REUTERSThe company is also exploring plans to establish EV battery production in Europe to further strengthen the brand's development across the continent.
"The location of a potential site and timing are still being discussed," Li said regarding the battery production facility.
BYD's European expansion is already well underway, with production set to begin later this year at its Hungary-based facility. A second site in Turkey is also in development.
Once operational, these two factories will have a combined capacity of 500,000 vehicles per year.
This manufacturing presence will help BYD bypass costly import tariffs imposed by the EU and establish a stronger foothold in one of the world's most lucrative EV markets.
The expansion comes after the European Union imposed additional tariffs on Chinese electric vehicle imports last year.
Establishing local manufacturing capabilities has become a necessity rather than an option for companies like BYD.
Despite these challenges, Europe remains an attractive market for Chinese carmakers due to the higher price points vehicles can command compared to China's competitive domestic market.
However, the chances of a new BYD factory being introduced in the UK remains slim after the company previously dismissed rumours due to Brexit concerns.
Speaking in March 2023, Michael Shu, European President of BYD, said: "As an investor, we want a country to be stable.
"To open a factory is a decision for decades. Without Brexit, maybe. But after Brexit, we don't understand what happened."
Shu added at the time that the UK didn't even make BYD's top 10 list of possible locations.
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BYD has European manufacturing bases in Hungary and Turkey
REUTERS
BYD has strengthened its position as China's top entry in the European market, outselling SAIC Motor's MG by 44 per cent in January, according to data from auto research group Jato Dynamics.
This comes despite an overall slowdown in demand for electric vehicles across Europe. To bolster its European push, BYD has been actively recruiting, reportedly poaching executives from Stellantis.
