Turkey signs contract with Chinese EV manufacturer BYD for a $1 billion plant

Turkey has reportedly signed an electric vehicle manufacturing contract with Chinese electric car maker BYD. According to Turkish officials, the $1 billion plant will be located in the west of the country.

The new plant coming up in Turkey will give the Chinese car manufacturer easier access to the European Union, as a small part of Turkey called East Thrace is in Southeast Europe. With the new plant, BYD will serve the Turkish domestic market with EVs, which accounted for 7.5 percent of car sales last year in Turkey.

On July 5, Turkey said that this deal resulted from a month-old decision to withdraw the plan to impose an additional 40 per cent tariff on electric vehicle imports originating from China. The decision was consciously made to improve investments in the country.

BYD, which has become China’s best-selling car brand after facing losses over many years, is now eyeing the European market. The Shenzhen-based car brand aims to bring its lower-priced EVs to Europe in the coming years, including the Seagull hatchback that executives expect to sell for less than €20,000 ($21,700).

In Europe, Hungary will also house BYD’s first passenger car manufacturing plant, which is likely to open before 2026.

On July 4, BYD inaugurated its first EV plant in Southeast Asia, Thailand. The company has also acquired a former Ford Motor factory in Brazil and looking at locations for a plant in Thailand.

BYD’s car sales are increasing rapidly in the European Union. In the first five months of 2024, it sold 12,944 cars in the EU, EFTA and UK markets compared to 2,120 units during the same period of 2023.