Chinese car giant BYD aims for European market with first factory in Hungary

Without a doubt, 2023 was a pivotal year for Chinese car manufacturers. BYD took over as leader in its domestic market from Volkswagen, and the expansion of Chinese brands to other markets has progressively gained momentum.

Europe, too, has felt the bold impact of this shift. Some models from Chinese manufacturers have even made their way into the top-selling lists in numerous countries. MG and BYD, extraordinarily popular in Scandinavia for instance, have shown the best performance.

European markets are beginning to look for strategies to balance the rapid expansion of Chinese manufacturers. Networking Asian brands with state subsidies has enabled them to offer their customers competitively low prices, which is no secret. The European Union has launched its own investigation. Nevertheless, some countries have already begun implementing new regulations targeting not only Chinese brand models, but also those manufactured in China.

Many experts stress the current overriding issue facing manufacturers from China, which is the absence of local, European factories. Establishing these factories would solve numerous issues relating to legislation and could also shift the perspective of European countries towards their development. Clearly, BYD has taken this advice onboard.

"Bloomberg" and "Automotive News Europe" report that BYD, the Chinese heavyweight, plans to construct its first factory in Hungary, specifically in the city of Szeged. Both electric and hybrid cars will be produced at the factory, expected to generate thousands of new jobs.

BYD’s first factory on the Old Continent is a significant step towards realizing their ambitious plan of capturing a 10 percent market share in the European market by the close of the current decade. The path ahead is far-reaching - in November 2023, just over 1 million new cars were registered across Europe, with BYD claiming 13,000 of these. This represents roughly 0.013 percent of the market share. However, developing local infrastructure could certainly facilitate this ambition.