BYD is reportedly considering building a battery manufacturing facility in Portugal, with the former Galp refinery site in Matosinhos, near Porto, emerging as a potential location. The investment could strengthen the Chinese automaker’s European battery supply chain and support its possible vehicle production expansion in Spain.
According to Portuguese newspaper Expresso, BYD is in discussions with the Portuguese government and investment agency AICEP regarding the proposed project. Sources familiar with the discussions described the plans as relatively advanced, although BYD has not officially confirmed the investment.
Portugal’s Economy Minister Manuel Castro Almeida confirmed a “fruitful dialogue” with a Chinese automaker about establishing a factory in the country but did not identify the company.
Former Refinery Site Considered for Battery Production
The potential location is the former Galp refinery in Matosinhos, which closed in 2021. The approximately 240-hectare site is undergoing demolition and redevelopment, with remaining areas available for future industrial or other uses.
Demolition work is expected to finish by the end of 2026, followed by additional soil remediation.
The location offers access to the Port of Leixões and established transport infrastructure. It could also benefit from Portugal’s planned lithium extraction at the Barroso mine, which is expected to begin production in 2028.
BYD’s Battery Manufacturing Capabilities
It remains unclear whether the proposed facility would manufacture battery cells, modules or complete battery packs.
BYD already produces its own lithium iron phosphate (LFP) cells and battery systems, including its Blade Battery technology. The second-generation Blade Battery uses a cell-to-pack design that integrates cells directly into the battery pack without conventional intermediate modules.
This approach improves packaging efficiency and reduces the space required for battery systems in electric vehicles and plug-in hybrids.
Potential Supply Hub for Spain and Portugal
According to Expresso, the proposed factory could serve as a battery production hub for the Iberian Peninsula, potentially supplying a future BYD vehicle manufacturing facility in Spain.
The company is also evaluating other European locations, including France, as it expands its regional manufacturing presence. BYD is already developing its first European passenger-car production facility in Szeged, Hungary.
Portugal is meanwhile seeking to attract more investment in battery manufacturing. Chinese battery producer CALB is planning a separate €2 billion factory in Sines, with an expected annual production capacity of 15 GWh.
However, BYD’s potential Matosinhos project remains unconfirmed, with no investment value, production capacity or employment targets disclosed.