BYD is finalizing plans to construct a new $1 billion electric vehicle (EV) plant in Turkey, as part of its strategic expansion into international markets following recent developments in global trade tariffs.
Turkey’s President, Recep Tayyip Erdogan, is expected to formally announce the agreement on Monday, with a ceremony scheduled in Manisa province where the facility will be located. This move comes shortly after BYD inaugurated its inaugural factory in Thailand and amidst plans for additional plants in Brazil and Mexico.
The decision to establish a manufacturing presence in Turkey is seen as a strategic response to new European Union tariffs on Chinese EV imports, which could impact competitors like SAIC with duties as high as 48.1%. BYD, facing an additional 17.4% tariff, anticipates mitigating these costs through what it terms the “EU premium,” as revealed by a Rhodium Group study indicating significantly higher earnings per vehicle in Europe compared to China.
Turkey recently eased tariffs to attract foreign investments, particularly in sectors such as electric vehicles, which accounted for 7.5% of new vehicle sales in the country last year, presenting a lucrative opportunity for BYD.
This expansion initiative follows BYD’s success in Thailand, where it leads the EV market with nearly half of all sales. Thailand aims for 30% of locally manufactured vehicles to be electric by 2030, aligning with BYD’s growth strategy in the region.
With plans underway for a new plant in Brazil and potential developments in Mexico, BYD aims to strengthen its position as a global leader in EV production. Despite narrowly trailing Tesla in Q2 global EV sales, analysts predict BYD will surpass its competitor by the end of 2024, according to Counterpoint Research.
