Chinese EV Maker BYD Invests $1 Billion in Turkey Factory to Avoid Tariffs
The global electric vehicle (EV) market is heating up, with Chinese EV makers scrambling to avoid punishing tariffs in key markets like the European Union and the United States. One of the world’s largest EV manufacturers, BYD, has recently made a strategic move to build a factory in Turkey, investing approximately $1 billion in the plant.
The decision to establish a manufacturing facility in Turkey comes in response to recent tariffs imposed on Chinese EV makers by the EU and the US. These tariffs are aimed at preventing Chinese companies from flooding the market with cheap vehicles and protecting domestic car and EV manufacturers.
The BYD plant in Turkey is expected to produce 150,000 electric and hybrid vehicles annually and will include a research and development center. This move is strategically important for BYD, as Turkey is in a customs union with the EU, allowing vehicles produced in the country to be exported to the EU tariff-free.
The new factory is projected to begin production by the end of 2026 and is expected to create 5,000 jobs in Turkey. The deal was signed in a ceremony attended by Turkish President Recep Tayyip Erdogan, Industry and Technology Minister Mehmet Fatih Kacir, and BYD Chairman and CEO Wang Chuanfu.
In addition to BYD, other Chinese car manufacturers like SWM are also looking to establish factories in Turkey. This move comes as Turkey aims to boost domestic production and reduce its reliance on imported vehicles.
The decision by Chinese firms to invest in manufacturing facilities in Turkey follows the implementation of higher tariffs on Chinese EV imports by the EU and the US. The EU recently imposed tariffs of up to 37.6 percent on Chinese EVs, while the US announced tariffs of up to 100 percent on a range of Chinese goods, including EVs.
BYD, the world’s second-largest EV company, has been rapidly expanding its production facilities outside of China. In addition to the new plant in Turkey, BYD has announced plans to build manufacturing plants in Hungary, Thailand, and Mexico.
Overall, the move by BYD and other Chinese EV makers to establish manufacturing facilities in Turkey is a strategic response to the changing trade landscape and a testament to the growing global demand for electric vehicles. With tariffs and trade tensions on the rise, companies are looking to diversify their production capabilities and access new markets to stay competitive in the evolving EV industry.