Chinese electric cars made in Europe: BYD plans to build a factory in Hungary: an opportunity for Austrian suppliers?

Two central figures had a major influence on the meeting: Daniel Dzihic, Managing Director of BYD and representative of Denzel, which took over the import, and Manfred Kainz, founder of TCM International. Dzihic is keen to bring added value to Austria, while Kainz, as is often the case, acts as a network marketer. “I expect a success story similar to the one we achieved with the BMW X3 in Styria,” Kainz told the Kleine Zeitung. “BYD needs excellent suppliers, and we have the opportunity to achieve high European added value. We must take advantage of this because our products are very good and we are very flexible.”

There is a lot at stake for both BYD and the Austrian suppliers: The Chinese want to get out of the criticism zone that punitive tariffs have brought them into. European cooperation could improve their image. For the suppliers, it is about stopping the downward spiral: the shift to e-mobility will put 20 percent of jobs at risk by 2040 – and with it a lot of added value.

>>> Ineos stops development of Magna electric off-road vehicle: 300 jobs at risk

New business partners from China will be of particular importance to Magna after losing several orders. Magna has assembled its own teams to prepare the complex offers. Manufacturers such as Xpeng, GAC and Chery are important beneficiaries. However, Magna’s plan still raises a number of questions: it is not clear how deep the products will have to be produced in Europe in order to avoid punitive tariffs. These details will be finalized in November at the latest. The first step will certainly be cooperation with BYD.

In June, Magna was forced to halt production of the Fisker Ocean. This came after Fisker, an American electric car startup, filed for bankruptcy protection for its Austrian subsidiary in March 2024. Fisker was facing financial difficulties and falling sales, which led to the production halt and ultimately the loss of this contract. As a result, Magna in Graz was forced to lay off up to 500 employees and expects a sales decline of around $400 million for the year. Shortly thereafter, the planned production line for a new car model from the British startup INEOS was not implemented and development at Magna was terminated. These changes were the result of a reorganization of the partner’s production strategies, which again forced Magna Steyr to rethink its capabilities and financial forecasts for the year. The collaboration with BYD could be an important step for Magna.

The European Union has announced that it will impose punitive tariffs on imports from China to protect domestic industries and crack down on unfair trade practices. By building a factory in Europe, BYD can avoid these punitive tariffs in the future by producing its cars domestically instead of importing them from China. This will reduce the cost of vehicles and make BYD more competitive in Europe.

According to a report by the state-run Anadolu Agency, BYD is also planning to set up a $1 billion factory in Turkey. Anadolu reported on Monday that the company has signed a similar contract with the Turkish government. The factory will have a production capacity of 150,000 vehicles per year. In addition, a development center is planned.