Chinese battery-electric-vehicle manufacturer BYD establishes its European headquarters and R&D center in Budapest, Hungary.

This project extends the brand’s commitment to the eastern European Union nation, which opposed the economic bloc’s imposition of tariffs last year on Chinese imports of BEVs unfairly subsidized by the state.

The HQ marks the fifth site for BYD in Hungary, following its bus factory in Komárom, additional facilities in Fót and Páty and Szeged, the location of its passenger-car manufacturing plant.

BYD says it will create thousands of jobs in the Hungarian capital, as well as supporting training and opportunities in further education through cooperation with at least three universities in the country.

The R&D center will begin with two specific projects; the first will focus on the integration of artificial intelligence into vehicles, while the second will help to develop next-generation electrified powertrains.

“We aim to deepen integration with local markets, enhance our localization capabilities and brand influence, and ensure sustainable growth in Europe,” says BYD Chairman Wang Chuanfu.

Naturally, the manufacturer is hoping to sidestep EU tariffs by producing vehicles within the bloc, but the jury is out over how many Chinese-made components will be used in these products and whether they breach the EU’s ‘origin of goods’ regulations.

Europe’s trading body, the European Commission, has already opened an investigation into BYD’s Hungary operations to see whether unfair state aid has been used in the construction of its Szeged plant.

It’s difficult to see how BYD’s vehicle plants can comply if it continues to follow the Chinese state’s recommendations to its automakers to only assemble knock-down kits for vehicles in foreign locations to protect their intellectual property.