Hungary is becoming a hot new investment destination for domestic battery-related industry chain enterprises.
Recently, BYD (002594: SZ) officially announced its plan to build a new energy vehicle production base in Szekesfehervar, Hungary. The base will be constructed in phases and is expected to create thousands of local job opportunities.
According to the Financial Times, the factory is expected to be located near the Belgrade-Budapest railway line, which is jointly built by Chinese and local companies.
BYD stated that the new production base aims to become a world-leading manufacturing facility for new energy vehicles by utilizing advanced technology equipment and highly automated production processes.
Establishing a factory in Hungary is an important milestone for BYD's global expansion strategy. It will help the company further expand its influence and market share in Central and Eastern Europe, laying a solid foundation for future development in Europe. Prior to this, BYD had already established an electric bus factory in Hungary, which has been operating smoothly since 2016.
In August 2023, the EU Battery and Waste Battery Regulation ("New Battery Law") came into effect, further regulating the entire lifecycle of batteries from design, production, use, to recycling, ensuring their safety, sustainability, and competitiveness. The new regulations will have a profound impact on all aspects of the battery industry chain's lifecycle in the EU region.
Against this backdrop, the establishment of BYD's passenger vehicle factory is expected to significantly reduce transportation and logistics costs, promoting the localization of BYD's battery production capacity.
BYD officials stated that Hungary is located in the heart of the European continent, serving as an important transportation hub with a long history of automotive industry development, well-developed infrastructure, and a mature automotive industry base. Additionally, as a partner in China's Belt and Road Initiative, Hungary has attracted a large number of new automotive and battery factories.
Previously, companies such as CATL, EVE Energy, and Sunwoda Electronic also announced investments in Hungary, and several Chinese power battery materials and equipment companies are either already in Hungary or on their way there.
BYD expressed that the construction of the production base will actively drive the local economic development, promote technological exchange and innovation between China and Hungary, and leverage BYD's advantages across the entire industry chain to help build a green "ecosystem" locally.
Public information indicates that BYD started expanding its overseas market for passenger vehicles in May 2021. In just two and a half years, BYD has successfully entered 58 countries and regions, including Thailand, South Korea, Israel, Brazil, Chile, and the United Arab Emirates. It has also achieved the top position in new energy vehicle sales in multiple countries, demonstrating BYD's determination and strength in expanding overseas markets. BYD aims to accelerate the pace of entering the European market for new energy passenger vehicles, further deepen its global layout, and actively promote the green transformation of the global energy structure.