China’s BYD has submitted a $1 billion (nearly 8.2 billion rupees) investment proposal to build electric cars and batteries in India in partnership with a local company, three people with direct knowledge of the plan told Reuters.
BYD and Hyderabad-based privately owned Megha Engineering and Infrastructures have submitted a proposal to Indian regulators to form an electric vehicle joint venture, said the people, who asked not to be named because the application is private.
The longer-term plan is to build a full lineup of BYD-brand electric cars in India, from hatchbacks to luxury models, one of the three people said.
BYD, the world’s largest producer of electric vehicles and plug-in hybrid vehicles, did not immediately respond to a request for comment. The company previously said it planned to set up manufacturing in India, now the world’s third-biggest auto market.
India’s ministries of commerce and heavy industries did not immediately respond to a request for comment.
BYD’s push into India is part of its rapid global expansion to challenge Tesla, which still leads only in electric vehicle sales. If the investment in India is approved, BYD would have a presence in all major global auto markets with the exception of the United States.
Tesla has recently restarted talks with the Indian government after suspending plans to enter the market last year when it failed to secure lower taxes on imported vehicles in talks with officials.
BYD has already invested $200 million (nearly Rs. 1,650 crore) in India, where it sells the Atto 3 electric SUV and EV e6 to corporate fleets, and plans to launch its Seal luxury electric sedan this year.
BYD’s proposed total production capacity was not immediately clear.
The maker of Blade batteries, as well as finished EVs, plans to scale up to production of 1,00,000 EVs per year in India for a few years, but would likely start by shipping vehicles in parts to assemble in the country while it works to build a supply chain, said one of the sources.
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 centers, the sources said.
The joint proposal comes amid stricter investment rules. Since 2020, India has tightened scrutiny on investments from neighboring countries, including China.
Those checks forced China’s Great Wall Motor to shelve a plan to invest $1 billion in the Indian market and pushed the MG Motor unit of Chinese state-owned automaker SAIC to seek a local partner.
Shenzhen-based BYD entered the Indian market in 2007, producing batteries and components for mobile phone makers.
In 2013, it began building electric buses with Megha Engineering, under a joint venture 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, EVs accounted for just over 1 percent of total car sales of 3.8 million in 2022, but the government wants to increase this number. to 30 percent by 2030.
In India, BYD will compete with national automaker Tata Motors and Chinese rival MG Motor, which currently dominate electric car sales.
© Thomson Reuters 2023