Chinese electric vehicle giant BYD reportedly mulls to establish its first European factory in Hungary as part of its global expansion strategy, Frankfurter Allgemeine Sonntagszeitung (FAS) reports.
It must be noted that BYD has already started to sell its clean energy vehicles in the region this year through imports. It also operated an e-bus factory in Hungary since 2017 until now.
Report highlights
According to the report’s unnamed sources, BYD has already decided internally to pursue Hungary for its new electric vehicle factory.
In fact, Hungarian Prime Minister Viktor Orbán recently went to China to visit the Chinese NEV leader’s company.
BNN Network indicated that BYD has yet to determine the specific production site in the selected country. It must also be noted that the Chinese automaker has still not verified the report.
Expansion strategy
European expansion is a crucial part of BYD’s efforts to dominate the global electric vehicle industry. It has already been leading the world’s largest auto market, China.
However, a European factory will undoubtedly aid the company in expanding its customer base by accessing the surging demand in the region.
BYD apparently confirmed to Reuters its ongoing search for an ideal site for the new European factory, with plans to finalize the location by late 2023.
Significance
Establishing a local production hub in Hungary can potentially aid BYD in avoiding potential tariffs the EU seeks to inflict on Chinese automakers.
As EV-a2z previously reported, the EU has launched an anti-subsidy probe against Chinese-made EV models. The move is crucial for the local automakers to defend their market position in their home country against these foreign brands’ cheap offerings.
“Global markets are now flooded with cheaper Chinese electric cars. And their price is kept artificially low by huge state subsidies.”
President of the executive branch of the European Union, Ursula von der Leyen
Governments worldwide continue to promote electric vehicles as the future of transportation, considering the alarming environmental issues induced by polluting energy sources. Therefore, BYD’s expansion strategy can potentially push the company to become the dominant global automaker against all competitors if it succeeds.
