Key Takeaways:
BYD Co. is in talks with Stellantis NV and other automakers to acquire a factory in Europe, a move that would accelerate its push into the region’s electric vehicle market and sidestep potential tariffs.
"We are in talks not just with Stellantis, but with other companies too," Li Ke, BYD’s executive vice president, said in an interview. "We are looking at any plant that we can use in Europe, because we really want to use that idle capacity."
The discussions come as Chinese-built EVs, including those from BYD, rapidly gain traction in Europe, accounting for 22% of all EVs sold in the region so far in 2026, up from 19% in 2025, according to data from Benchmark Mineral Intelligence. A local production base would allow BYD to avoid import duties and solidify its foothold in a market where EV sales rose 27% year-over-year in April.
For European automakers like Stellantis, selling an underutilized plant could generate cash and streamline operations. However, it also risks creating a more formidable local competitor in BYD, which surpassed Tesla in global EV sales in 2022. The move highlights a strategic pivot for Chinese automakers, who are increasingly shifting from exporting vehicles to establishing local manufacturing hubs within Europe to better compete with incumbents like Volkswagen and Renault.
This strategy is not unique to BYD. In April, Stellantis itself announced a joint venture to build vehicles for its Chinese partner Leapmotor at a plant in Spain. Volkswagen’s CEO has also floated the idea of sharing unused factory space as a “clever solution” to Europe’s excess capacity. Meanwhile, BYD is already ramping up production at its own newly built plant in Szeged, Hungary.
Acquiring an existing factory would allow BYD to bypass the years of construction and regulatory approvals required for a new plant, giving it a significant speed advantage. The talks, which include potential sites in Italy, are part of a broader offensive by Chinese EV makers who are leveraging their cost advantages and technological leadership in battery production to expand globally. This aligns with the philosophy of BYD’s founder, Wang Chuanfu, whose focus on vertical integration has made the company a dominant force in the EV supply chain, from batteries to the vehicles themselves.
This article is for informational purposes only and does not constitute investment advice.
