The European Union is investigating whether China provided unfair subsidies to support BYD’s planned electric vehicle (EV) plant in Hungary, the Financial Times reported on Thursday, citing sources familiar with the matter.
The European Commission is in the early stages of a foreign subsidy probe into the BYD facility, the report said. If the investigation finds that the Chinese automaker benefited from undue state support, the EU could require BYD to divest assets, scale down production, reimburse subsidies, or face penalties for non-compliance, according to the Financial Times.
See also: BYD Europe Aims to Triple Market Share, Targets Leading Position Against Tesla and EU Automakers
Hungary’s government has not been formally notified of the probe, Europe Minister Janos Boka told the newspaper. “It is not surprising—and it is generally known—that any investment that takes place in Hungary appears on the Commission’s radar very quickly, and the Commission follows with redoubled attention every state aid decision that takes place in Hungary,” Boka was quoted as saying.
Hungary, under Prime Minister Viktor Orban, has maintained close economic ties with China and has been a frequent critic of EU policies, particularly since Russia’s full-scale invasion of Ukraine in 2022. BYD’s planned factory is part of Hungary’s broader effort to position itself as a major hub for EV manufacturing in Europe.
See also: BYD Considers Third European Plant Amid Tariffs on Chinese EV Imports
