By D. W. G. Kalani Tharanga, JadeTimes News
China's leading electric car manufacturer, BYD, has taken a significant step in its global expansion efforts by securing a $1 billion (£780 million) agreement to establish a manufacturing plant in Turkey. This ambitious project, set to produce up to 150,000 vehicles annually, underscores BYD's commitment to broadening its production capabilities outside of China. The new facility, expected to create approximately 5,000 jobs, is scheduled to begin operations by the end of 2026. The landmark deal was formalized at a high profile event in Istanbul, attended by President Recep Tayyip Erdogan and BYD's chief executive Wang Chuanfu. Despite repeated requests for additional information, BYD has not yet provided further details on the arrangement.
Strategic Move Amidst Rising Tariffs in the EU and US
The announcement of BYD's new plant comes at a crucial time as Chinese electric vehicle (EV) manufacturers face increasing trade barriers in key markets such as the European Union and the United States. Recently, the EU implemented measures to protect its automotive industry by raising tariffs on Chinese EVs. This decision resulted in BYD facing an additional 17.4% tariff on vehicles shipped from China to the EU, atop the existing 10% import duty. However, by establishing a manufacturing base in Turkey, which is part of the EU’s Customs Union, BYD can circumvent these additional tariffs, providing a strategic advantage for the company's European operations. Additionally, the Turkish government has imposed a 40% tariff on imports of Chinese vehicles, further incentivizing local production.
Global Expansion Efforts, New Plants in Hungary, Thailand, and Mexico
BYD's expansion into Turkey is part of a broader strategy to increase its manufacturing footprint worldwide. At the end of last year, the company announced plans to build its first passenger car factory in Europe, located in Hungary, which is expected to create thousands of jobs. On the same trajectory, BYD recently inaugurated an EV plant in Thailand, marking its first manufacturing facility in Southeast Asia. This plant, with an annual capacity of 150,000 vehicles, is projected to generate 10,000 jobs, highlighting BYD’s aggressive push into new markets. Furthermore, the company has revealed plans to establish a manufacturing plant in Mexico, aiming to capitalize on the growing demand for electric vehicles in the North American market. Backed by prominent US investor Warren Buffett, BYD is now the world’s second largest EV company, trailing only Elon Musk's Tesla, and continues to reinforce its position through strategic global investments.
