China’s BYD, a top maker of battery electric vehicles, has agreed to build a $1 billion car factory in Turkey, as announced by the Turkish government. The agreement was signed by BYD’s CEO Wang Chuanfu and Turkey’s Industry and Technology Minister Mehmet Fatih Kaci in Istanbul, with Turkish President Recep Tayyip Erdogan in attendance.
The move aims to cater to the increasing demand for new-energy vehicles in the region and target consumers in Europe. This decision comes shortly after the European Union imposed provisional additional duties on imports of Chinese-made EVs, ranging from 17.4% to 37.6%, to counter what they perceive as unfair government support for Chinese car manufacturers.
Being in a customs union with the EU, Turkey can export vehicles to the trading bloc tariff-free, making it an attractive location for BYD’s new factory. The $1 billion investment will enable the facility to produce 150,000 electric and hybrid vehicles annually, along with establishing a research and development center for sustainable mobility technologies.
Production at the factory is slated to commence by the end of 2026, creating up to 5,000 jobs in Turkey. BYD's decision to invest in Turkey aligns with its strategy to expand its presence in Europe, following a similar announcement about building an EV factory in Hungary last year.
While the EU's additional tariffs on Chinese EVs are currently in effect, discussions between the EU and China are ongoing. If no agreement is reached, the tariffs will become definitive in November. BYD's proactive approach to establishing manufacturing facilities in Europe underscores its commitment to the region's growing electric vehicle market.
