It’s widely known that BYD, a Chinese automaker, holds significant traction in their homeland. But it’s less known that they are eyeing a massive breakthrough in Europe. Within a mere two years, BYD aims to match or even surpass the likes of Nissan in terms of European car sales. With a new factory already underway in Hungary and another one in Turkey, their plan is to have these facilities churning out vehicles for the European market by 2026 end.
Crafting a Stellar Growth Strategy
Meeting with skepticism about their lofty goal of selling approximately 300,000 cars annually in Europe, Stella Li, BYD’s global executive vice president and head of operations in Europe and the Americas, shares their game plan. It’s all about brand building, gaining trust, and taking steady, well-planned steps. She points to their substantial presence at the Goodwood Festival of Speed and their high-profile sponsorship of the soccer Euros as brand-building initiatives.
From Li’s observations, once people are familiar with the brand, they are more likely to test-drive a car, and according to her, “60% of people who test-drive our cars make a purchase”.
Rapid Adaptation and Learning
Not one to rest on their laurels, BYD is keen on fast-paced learning and adapting. They take in feedback from drivers and constantly improve their cars. Their focus was initially on battery cars, but they soon realised that the European market has a larger appetite for long-range plug-in hybrids, which BYD calls DM-i.
Li confirmed that they would focus more on DM-i, with more cars with that drivetrain expected next year, following the success of the Seal U DM-i. The Hungary plant would be able to manufacture at least eight different car models on one production line, a feat few other manufacturers can achieve.
Navigating The Challenges
However, their growth could be hampered in the short term by EU tariffs on Chinese cars, even though BYD’s tariff rate at 27.4% is lower than some other competitors because it receives less subsidy from the Chinese government, according to the EU.
Li said BYD aims to be a locally-based manufacturer and will manufacture its top-selling models in Turkey and Hungary. While the company has plans for localisation within five years, there’s no clear schedule for when they will produce battery packs and cells in the EU.
Daring To Dream: Unveiling Premium Brands
If selling 300,000 cars a year seems ambitious, BYD’s plan to establish a premium brand is even more audacious. The automotive landscape is strewn with failed bids by brands like Infiniti, Cadillac, Lancia, and Saab to make a foray into the premium sector.
Nonetheless, at the Goodwood Festival, BYD showcased two more brands: the Yangwang brand with its U8 super-SUV and U9 supercar; and Denza’s chrome-heavy MPV. Li said that these premium brands would be launched in the UK within the next two years.
The Future: Reality Or Fantasy?
Will BYD’s ambitious European growth plans materialise, or will they remain a pipe dream? Only time will tell. But one thing is certain: if a conventional petrol car was a 2G phone, in BYD’s words, they’re already at 5G.
