China’s BYD has submitted a $1-billion investment proposal to build electric cars and batteries in India in partnership with a local company, three people with direct knowledge of the plan said.
BYD and privately held Hyderabad-based Megha Engineering and Infrastructures have submitted a proposal to Indian regulators to form an EV joint venture, the people said.
The longer-term plan is to build a full line-up of BYD-brand electric cars in India from hatchbacks to luxury models, one of the three people said.
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Charging stations, R&D and training centres
The investment proposal also includes a plan by BYD and Megha Engineering to set up charging stations in India and build research and development and training centres, the sources said.
BYD, the world’s largest producer of EVs and plug-in hybrid vehicles, previously said it planned to set up manufacturing in India, now the world’s third-largest car market.
The carmaker’s push into India is part of its rapid global expansion to challenge Tesla, which still leads in sales of EVs alone.
If the India investment is approved, it would give BYD a presence in all major global car markets with the exception of the United States.
Tesla has recently restarted talks with India’s government after putting on hold plans to enter the market last year when it failed to secure lower tax duties on imported vehicles in talks with officials.
BYD has already invested $200 million in India where it sells the Atto 3 electric SUV and the e6 EV to corporate fleets, and plans to launch its Seal luxury electric sedan this year.
The total production capacity proposed by BYD was not immediately clear.
Strict investment rules
The maker of Blade batteries, as well as finished EVs, has plans to scale up to production of 100,000 EVs annually in India over a few years but would likely begin by shipping vehicles in parts for assembly in the country as it works to build up a supply chain, one of the sources said.
The joint proposal comes amid stricter investment rules in India. The country has, since 2020, tightened scrutiny of investments from neighbouring countries, including China.
Those controls forced China’s Great Wall Motor to shelve a plan to invest $1 billion in the Indian market and pushed Chinese state-owned automaker SAIC’s MG Motor unit to look for a local partner.
Shenzhen-based BYD entered the Indian market in 2007 producing batteries and components for mobile phone makers.
In 2013 it started building electric buses with Megha Engineering, under a joint venture company called Olectra Greentech.
BYD, which stands for Build Your Dreams, sold a total of 1.86 million BEVs and plug-in hybrids in 2022.
In India, the carmaker will compete with domestic automaker Tata Motors and Chinese rival MG Motor that currently dominate electric car sales.
EV sales made up just over 1% of India’s total car sales of 3.8 million in 2022, but the Narendra Modi-led government wants to grow this to 30% by 2030.
- Reuters, with additional editing by Vishakha Saxena
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