BYD’s factory plan in Thailand underscores how China’s EV industry is going global

Wednesday’s announcement of production plans in Thailand by BYD, the world’s largest electric vehicle manufacturer, underlines how Chinese suppliers are seizing the growing demand for energy-efficient vehicles to expand globally.

BYD, backed by Warren Buffett, said it has signed a contract with WHA Corp. Public Company Ltd., Thailand’s largest industrial estate developer, to purchase land for electric passenger car construction in the Southeast Asian country.

The site will be BYD’s first wholly-owned factory to manufacture passenger cars outside of China. Although relatively little known in the US, where it makes buses, the industry’s heavyweight, headquartered in Shenzhen, has this year’s market capitalization that sometimes surpassed that of GM and Ford combined. BYD declined to say how much it expected to invest in the Thai project.

Meanwhile, China’s Contemporary Amperex Technology, or CATL, the world’s largest supplier of EV batteries, signed a real estate deal in Hungary with the city of Debrecen on Monday that marked the official launch of a factory there, Xinhua News Agency reported.

CATL said last month it planned to invest 7.34 billion euros to build the facility, the second in Europe after a factory in Germany. Debrecen is close to CATL customers Mercedes-Benz, BMW and Volkswagen, the company said last month.

“The greenfield project in Hungary will be a huge leap in CATL’s global expansion,” said a statement from CATL President Robin Zeng in August. Zeng is one of China’s wealthiest business leaders, with a fortune worth $37 billion on the Forbes Real-Time Billionaires List today.

CATL isn’t the only Chinese EV maker keeping an eye on Hungary. On July 29, Péter Szijjártó, the minister of Hungarian Foreign Affairs and Trade, and Hui Zhang, vice president of NIO Europe Office, said that a factory for NIO battery-changing equipment will start there in September. NIO, headquartered in Shanghai, also makes electric passenger cars.

China’s EV companies are globally competitive, in part because of an early domestic focus on the market and a desire to leapfrog older global incumbents that dominate mainstream internal combustion engine technology. According to a report from the International Energy Agency, more electric vehicles were sold in China in 2021 – 3.3 million – than worldwide in 2020. In the first quarter of 2022, sales in China more than doubled compared to the previous year. first quarter of 2021.

Success at China EV startups like NIO and Xpeng have turned their founders into billionaires. NIO chairman William Li is worth $3 billion on the Forbes Real-Time Billionaires List today, and Xpeng’s He Xiaopeng is worth $2.8 billion.

The US is not barred from new investment by China-based suppliers to the EV industry. SEMCORP Advanced Materials Group, also known as Yunnan Energy New Material, said in May it will build a factory to make separator film for EV batteries in Sidney, Ohio, creating nearly 1,200 jobs with an annual payroll of $73 million and $916 million in capital investment.

“The Sidney plant is one of the largest investments in our company’s history, as we know the United States is deeply committed to building supply chains for EVs and energy storage right here at home,” said a statement from CEO Paul Lee. an American citizen. with an estimated fortune at $6.5 billion on the Forbes Real-Time Billionaires List today.

CATL is also reportedly looking for a North American site. Reuters said on Aug. 3 it plans to supply lithium-ion batteries to Ford and begin battery production in North America by 2026, citing “a person with knowledge of the matter.”

Recently announced investments in vehicles and components follow lithium mine acquisitions by Chinese companies in Argentina (CATL, Zijin Mining), Australia (Tianqi Lithium) and Canada (Ganfeng Lithium), according to a report last year from S&P.

Further subtle evidence this week of China’s industry leaders’ continued appetite for growth: Ganfeng said it planned to change its name from the merely modest “Ganfeng Lithium Co.” to “Ganfeng Lithium Group Co.”

“The reasons for changing the company’s name are to accurately reflect the diversification of the company’s upstream, midstream and downstream lithium ecological activities, clearly improve the recognition of the company’s core business, and clearly improve the strategic positioning of the company as a global leading lithium environmental company,” it said.

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@rflannerychina