BYD delays production in Hungary

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The carmaker will delay mass production for a year and run the plant below capacity for at least the first two years, according to Reuters, reflecting a more cautious European entry strategy amid softening EV demand and rising trade tensions.

Hungary was originally intended to be the OEM’s gateway into Europe, with the plant previously due to begin production from next month. The Hungary plant, announced in December 2023, was set to become BYD’s first passenger car manufacturing site in Europe, following the company’s rapid global expansion and launch of several EV models across European markets. The greenfield project near Szeged was widely viewed as a strategic move to reduce logistics costs and increase localisation for European customers, with plans to produce models such as the Seal and Atto 3.

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Now, although unconfirmed, it seems that BYD may be shifting its focus to Turkey instead. Turkey could be a strategic move to reduce distance across BYD’s supply chain, with the port of Izmir ideally located to receive parts from China with onward shipping to Europe via land or sea.

Turkey could also be a nearshoring move, helping the carmaker to enter the European market via the country. Last year, BYD signed a $1bn deal with Turkey to build a factory in Manisa with capacity for 150,000 vehicles annually. Turkey also has a customs union agreement with the EU, allowing the OEM to potentially skirt tariffs. 

Automotive Logistics has contacted BYD for comment.