BYD Digs In for a European Factory Takeover as Export Growth Accelerates

BYD aims to acquire distressed European plants outright to bypass EU's 17% EV tariff, while exports surge but profits drop. Also launching hybrid pickup Shark in China.

BYD is pushing hard to secure existing production sites across Europe, but on its own terms. The Chinese electric-vehicle giant is in advanced talks with Stellantis and other manufacturers about acquiring underutilized factories — and it wants full ownership, not a joint venture. The strategy, confirmed by vice-chairwoman Stella Li during a London meeting on Wednesday, is designed to bypass rising trade barriers while preserving control over its supply chain and quality standards.

The EU’s 17% additional tariff on Chinese-made EVs, stacked on top of the standard 10% import duty, has made local assembly a financial imperative. BYD already has a factory under construction in Szeged, Hungary, where series production is slated to begin in the second quarter of 2026. But the company is now scouting additional locations — including plants in Portugal, Spain, and crucially, Italy. The Italian sites under discussion are Cassino and Mirafiori, both of which carry heavy undercapacity. Cassino built just 2,916 vehicles in the first quarter of 2026, a 37.4% plunge from a year earlier, making it exactly the kind of distressed asset BYD wants to repurpose.

The export machine is running at full throttle. In April 2026 alone, BYD shipped 135,098 vehicles abroad, outpacing Tesla’s estimated monthly export volume of around 119,341 units. Overall sales that month reached 314,100 cars, with exports accounting for roughly 43% of the total. The company has set an ambitious annual target of 1.5 million exports for 2026, a 50% jump from the prior year. Yet the cost of this overseas push is eating into profits. First-quarter net income dropped 55% year-on-year, and the squeeze prompted BYD to slash around 100,000 jobs globally in 2025, bringing headcount to just under 870,000. The average wage of roughly $21,000 still gives the group a structural cost advantage that underpins its aggressive pricing.

Back in China, BYD is preparing to launch the hybrid pickup “Shark” on home soil, a model that had its global debut in Mexico in 2024. The decision comes as several Chinese cities relax longstanding restrictions on pickup trucks. The Shark, which generates over 430 horsepower from a combined combustion and dual-electric motor setup, has already sold nearly 12,000 units overseas in the first four months of 2026. It targets a fast-growing domestic segment that BYD previously served only from abroad.

Elsewhere, the brand is racking up market-share gains. In Australia, the Sealion 7 overtook Tesla’s Model Y in April, lifting BYD to the No. 2 spot among automakers there. South Korea has emerged as another bright spot: BYD passed 10,000 cumulative vehicle sales within just 11 months, a record for any imported brand in that market. Meanwhile, the premium Denza line — for which BYD recently poached engineers from Porsche — is set to launch in the United Kingdom later in 2026, and management has described Maserati as “very interesting” though no purchase agreement is in place.

The European factory hunt is the linchpin of BYD’s broader strategy. By taking full control of existing plants rather than building from scratch or forming joint ventures, the company can accelerate local production, reduce tariff exposure, and hedge against regulatory shifts. The Hungarian site will serve as the first foothold; if Italian or Iberian deals materialize, BYD would have multiple manufacturing anchors on the continent. For European automakers saddled with idle lines, a sale to BYD offers a way to repurpose assets that would otherwise remain a drag. For BYD, the next year will test whether it can turn these negotiations into tangible factories without losing the cost discipline that got it here.