Germany is seen as the most likely nation to host a third BYD production plant as China recognizes the country’s efforts to oppose European Union tariffs on its battery-electric vehicles.
A source close to the company tells Reuters news agency the economic bloc’s largest economy and car market is favored also because of its very close trading and vehicle production relationship with China.
The move is seen as part of several Chinese automakers seeking to set up vehicle production plants in Europe, albeit as assembly plants for imported knock-down kits in line with Chinese state instructions to protect their intellectual property.
Automakers also hope to avoid the some of the import tariffs the EU imposed on China-made BEVs last year, but percentages of foreign components could still see Europe impose a certain number of tariffs on the imported knock-down kits.
The source says while Germany is BYD's top choice, there remains concerns over the nation’s comparatively high labor and energy costs, low productivity and low flexibility. BYD is yet to respond with an official comment.
At the same time as favoring nations that oppose tariffs on Chinese products, BYD is following state directives to avoid cooperating with nations that support the tariffs against unfairly state subsidized BEVs, such as France and Italy, the source adds.
