(Yicai) July 10 -- Chinese new energy vehicle giant BYD will reportedly invest USD1 billion to build a factory and a research and development center in Türkiye to deal with high local tariffs and the European Union’s anti-subsidy duties.

The factory, expected to have an annual production capacity of 150,000 vehicles, will likely be completed by the end of 2026, generating 5,000 local jobs, Securities Times reported, citing a deal BYD signed with Türkiye’s Ministry of Industry and Technology on July 8.

When Yicai contacted BYD to confirm the news today, the Shenzhen-based company declined to comment.

Türkiye introduced a 40 percent additional tax on vehicles imported from China on June 7 to protect its domestic production capability and reduce its deficit. However, if Chinese carmakers build production facilities in Türkiye, they would pay only 10 percent tariffs.

On July 4, the European Commission proceeded to levy provisional import tariffs on China-made electric vehicles ranging from 17.4 percent to 37.6 percent. By producing cars in Türkiye, BYD could also avoid these new high tariffs thanks to a customs agreement between the EU and Türkiye.

BYD entered the Turkish market in September last year. It exported 203,400 cars to 88 countries and regions in the first half of the year, up 174 percent from a year earlier. In addition to the Turkish facilities, BYD also has plants under construction or in development in Thailand, Brazil, Indonesia, Hungary, and Mexico.

Some 1.23 million cars were sold in Türkiye last year, up over 57 percent from the year before, with Chinese brands achieving a 4.5 percent market share, according to statistics from the Turkish association of automobile manufacturers. Among them, 66,000 units were EVs, accounting for 6.8 percent of the total.

In the first five months of the year, some 471,700 vehicles were sold in Türkiye, up 6 percent from a year earlier. Chinese carmaker Chery Automobile sold 27,000 units in the country, up 387 percent in the period and ranking fifth after Fiat, Renault, Ford Motor, and Volkswagen Group. SAIC Motor’s MG marque and BYD are the two other Chinese firms selling cars in Türkiye.

Editor: Futura Costaglione