BYD’s big move: Will Chinese EV giant start assembling cars in India?

BYD, a major Chinese electric vehicle (EV) manufacturer, may be eyeing India for a major expansion via assembly of cars.

 

With increasing demand for its EVs and high import duties, the company is seriously considering setting up local assembly operations.

BYD cars are set to get cheaper in India.

But is this a big move in BYD’s strategy for India? Let’s see: 
 
Why is BYD considering local assembly?
 
BYD’s plan to assemble cars in India is driven by a few key factors:

 
Rising demand for EVs in India: The Indian electric vehicle market is growing rapidly, and BYD is struggling to meet the demand for its popular EV models in the country.
 
Last year, the company saw a massive 88 per cent jump in sales, touching around 5,500 units.
 
Dealers are reportedly holding hundreds of customer bookings, and many vehicles for the December quarter were sold out even before they reached showrooms.
 
Import duties are a major challenge: Currently, India imposes high import duties — up to 110 per cent — on fully assembled foreign cars.
 
This makes imported vehicles expensive for Indian consumers and limits the number of cars BYD can bring into the country.
 
For example, BYD can only import 2,500 units of each model per year.
 
This limits the company’s growth potential, especially when more customers are interested in EVs.

 
Local assembly could solve these problems: To overcome these challenges, BYD is exploring local assembly options.
 
Instead of importing fully-assembled cars, BYD could bring in semi-knocked-down (SKD) parts and assemble the vehicles in India.
 
This move could help reduce import tariffs from 70 per cent to about 30 per cent, making the vehicles more affordable and allowing BYD to expand presence in the Indian market.
 
 
What is SKD assembly and why is it important?
 
SKD is a concept where BYD would import partially-assembled car parts and complete the assembly process in India.
 
This method is cost effective and much easier to clear with local regulations compared to setting up a full-scale factory.
 
By taking this route, BYD could lower its costs and pass on the savings to Indian customers, making their EVs more competitively priced.
 
 
BYD’s plan: What’s next?
 
BYD’s plans for local assembly in India are still in the early stages. But there’s a clear indication that the company is serious about expanding its operations in India.
 
The automaker is working on securing the necessary local certifications for new models, which is an essential step before it can proceed with assembly operations.
 
Additionally, senior BYD executives are expected to visit India in the coming months to assess the situation and meet local authorities.
 
This visit will likely play a critical role in shaping the final strategy for local assembly.
 
 
Why this could be a game-changer for BYD in India
 
The move towards local assembly would allow BYD to maintain its competitive edge in the Indian market.
 
Despite the high import duties, BYD’s pricing has been competitive, especially in the premium EV segment.
 
For instance, the Atto 3 electric SUV, priced around Rs 25 lakh (Rs 2.5 million), competes with models from Tata Motors and Mahindra, while being more affordable than Tesla’s offerings in India.
 
Similarly, the Sealion 7, priced Rs 49 lakh-55 lakh (Rs 4.9 million onwards), undercuts Tesla’s Model Y, which is priced around Rs 60 lakh (Rs 6 million).
 
If BYD goes ahead with local assembly, it could dramatically improve pricing and open up opportunities in India’s growing EV space.
 
 
How does BYD compare to Tesla?
 
Unlike Tesla, which has been offering discounts to attract more customers, BYD’s pricing remains competitive even with the high import duties.
 
This strategy has helped the brand establish a solid presence in India, especially in the premium EV segment.
 
 
E-Vroooom’s views
 
Will BYD set up a local assembly in India?
 
While it’s still early days, this move could position BYD as a dominant player in the Indian electric vehicle market, offering affordable and high-quality electric cars to a growing base of Indian customers.
 
BYD’s plans to explore local assembly in India seem promising.

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The company is considering SKD assembly models to avoid high import tariffs, and the increasing demand for its EVs gives BYD a strong reason to expand in India.