China-based BYD has committed to constructing a $1 billion assembly plant for electric vehicles (EVs) in Turkey, Turkish officials announced on Monday, July 8.

China's BYD EV Facility Plans in Turkey

According to CNN, Turkey's Industry and Technology Minister Mehmet Fatih Kaci and BYD CEO Wang Chuanfu reportedly inked the deal in Istanbul earlier this week. Turkish President Recep Tayyip Erdogan was present during the signing.

The deal with Turkey states that BYD would spend about $1 billion on the facility, which will have the capacity to manufacture 150,000 hybrid and electric cars per year and establish a research and development center for sustainable transportation technology.

The factory, which will provide up to 5,000 jobs in the country, is expected to begin production at the end of 2026.

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Workaround to Reach EU Customers

In a statement, a BYD representative said the business aims to fulfill the region's increasing demand for new-energy cars and to reach European customers. The announcement was made after the European Union imposed higher levies on EVs manufactured in China.

The tariffs, which range from 17.4% to 37.6%, target a flood of low-priced Chinese automobiles produced with what the EU perceives as unfair government subsidies. There is a customs union between the EU and Turkey. Therefore, the nation may export autos to the trade bloc without paying any tariffs.

BYD announced last December that it would establish an EV facility in EU member Hungary. This would make BYD the first major Chinese automaker to produce passenger cars in Europe.

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