China’s BYD, the world’s largest electric vehicle (EV) producer, has signed a deal with Türkiye’s industry and technology ministry to build a $1 billion factory in the country with a capacity for manufacturing 150,000 vehicles. The investment will also include a mobility and research and development (R&D) center.
The BYD Türkiye factory is expected to begin production by the end of 2026 and create 5,000 direct jobs in the country. On Monday, the parties signed the deal in a ceremony that included President Recep Tayyip Erdogan, industry and technology minister Mehmet Fatih Kacir, and BYD chairman and CEO Wang Chuanfu.
“We expect this investment to make a significant contribution to our exports in the medium term and further reduce our already shrinking current account deficit,” vice president Cevdet Yilmaz stated.
Tariffs on EV imports
On Monday, Türkiye announced the imposition of an additional 40 percent tax for imports of vehicles from China to boost domestic production’s share of the Turkish market and encourage investments. The EU commission also recently announced additional tariffs for EVs from China. The BYD deal with Türkiye could ease the access of investors to European markets due to Türkiye’s customs union with the EU.
Türkiye to become an EV hub
BYD is the world’s leading electric vehicle producer with around three million units in sales annually. Kacir stated that Türkiye’s efforts to bring new technologies and R&D highlight its potential to become not only a hub for international investments, but also a center of innovation and advanced green technology.
“This investment for the production of new generation vehicles with high domestic added value will strengthen our automotive industry,” he added. Türkiye, the third-largest automobile manufacturer in Europe, sees the transformation towards next-generation, environmentally friendly EVs as a priority target in the automotive sector, which is the leading Turkish export sector, he added.
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Attractive investment climate
Omer Bolat, Türkiye’s trade minister, stated that BYD’s investment is a strong sign of Türkiye’s attractiveness to investors. Hence, the country has an attractive investment climate, strong production, a qualified workforce, an effectively implemented Customs Union, and a wide network of free trade agreements.
“In coordination with all relevant institutions, the trade ministry will continue to contribute to our country’s policies on the basis of projections for direct investments in line with our domestic production, employment, and export targets,” he added.
On Monday, SWM, another Chinese automaker, announced that it was applying to build a factory in Türkiye.
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