China’s electric vehicle giant BYD opened a factory in Thailand on Thursday, continuing its international expansion despite a market slowdown and hours before the European Union was set to impose surprise tariffs on Chinese electric vehicle companies.
The plant in Rayong, an industrial area southeast of Bangkok, will be able to build up to 150,000 vehicles a year, according to the company, which dominates its domestic market.
Wang Chuanfu, chief executive of Shenzhen-based BYD, said production will initially focus on fully electric vehicles and later expand to include plug-in hybrids, which combine a conventional engine with an electric motor.
“The BYD Thailand plant has an annual capacity of 150,000 vehicles, including the four major vehicle and parts production processes, and will create about 10,000 jobs,” Wang said at the opening ceremony.
The move comes as Thailand seeks to shift its long-standing auto sector away from conventional vehicles and toward EV production.
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BYD surpassed Elon Musk’s Tesla in the fourth quarter of 2023 to become the world’s top seller of electric vehicles.
Tesla regained the top spot in the first quarter of this year, but BYD is bullish on its expansion, insisting last month that it will go ahead with a second factory in the EU.
The Chinese automaker posted a record annual profit of 30 billion yuan ($4.1 billion) last year, but in April reported lower-than-expected revenue for the first quarter of 2024.
BYD has faced a fierce price war in China, where 129 EV brands are undercutting it — with only 20 achieving a domestic market share of one percent or more, according to Bloomberg.
China has led the global shift to electric vehicles, with nearly one in three cars on its roads being electric by 2030, according to the International Energy Agency’s annual Global EV Outlook.
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But European regulators have raised concerns about what they say is “overcapacity” created by excessive government subsidies.
Seeking to protect European manufacturers from cheaper Chinese imports, Brussels proposed a temporary increase in tariffs on Chinese manufacturers: 17.4 percent for BYD, 20 percent for Geely and 38.1 percent for SAIC — plus of the current 10 percent import duty.
The trade chiefs of the EU and China held talks last weekend in a bid to avoid a sharp trade war, but the tariffs are set to take effect on Thursday.
But while high, the EU tariffs are significantly lower than the 100% rate the United States imposed last month on Chinese electric cars.
Source: AFP