BYD signed a deal to build a massive $1 billion EV plant in Turkey on Monday. The news comes after BYD opened its first factory in Thailand, with others planned in Brazil and Mexico as it expands in overseas markets.
Turkey’s President, Recep Tayyip Erdogan, is expected to officially announce the deal on Monday. Officials told Bloomberg there will be a ceremony in Manisa province, where the plant will be built.
Update 7/8/24: BYD signs the deal for its new EV plant in Turkey, creating up to 5,000 jobs and a new foothold in Europe.
BYD’s new plant could help it overcome the potential impacts of new EU tariffs on Chinese EV imports. This week, the EU placed extra tariffs of up to 38.1% on electric cars from China.
Although BYD was included, it was at the lower end, with an additional 17.4% rate. Rivals like SAIC are set to receive an extra 38.1% duties, raising the rate as high as 48.1%.
BYD expects to overcome the extra duties as it makes more on some EVs in Europe than in China due to the “EU premium.”
According to a study from Rhodium Group, BYD earns about 14,300 euros ($15,360) on each Seal U model sold in the EU. In China, it earns around 1,300 euros ($1,400). The report notes EU tariffs would need to be raised to 50% or higher to make an impact, but it could hurt European automakers even more.
BYD nears EV plant deal with Turkey
Meanwhile, Turkey eased tariffs last week to encourage investments, including from BYD. Electric cars accounted for 7.5% of new vehicle sales in Turkey last year, opening a significant opportunity for the Chinese EV maker.
The new EV plant in Turkey comes after BYD opened its first factory in Thailand on Thursday. BYD is already the top-selling EV brand in Thailand, but the country is moving quickly toward electric cars.
Thailand aims for 30% of vehicles made in the country to be electric by 2030. BYD already accounts for nearly 50% of the Thai EV market.
It’s also the third largest passenger car brand with a 9% share. However, recent price cuts of up to nearly $10,000 have sparked an investigation by authorities.
BYD is also building an EV plant in Brazil, with another one in Mexico likely to be announced soon. With factories in key global markets, BYD looks to accelerate its overseas expansion.
After selling 426,039 EVs in Q2, BYD was barely topped by Tesla (443,956) for the title of the world’s largest EV maker. However, a new study from Counterpoint Research suggests BYD will take the title by the end of 2024.
Source: Bloomberg
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