BYD eyes expansion in India amid ongoing challenges

Tesla is widely considered to be the flagbearer and the largest manufacturer of electric vehicles globally. However, readers may find it surprising that it’s not Tesla but in fact BYD which holds the largest share in the global EV market. The Chinese brand holds a 24.7 percent market share whereas the American EV manufacturer accounts for 10.4 percent market share.

And yet, BYD is having a tough time expanding in India in the passenger vehicle space (PV). BYD has the second-largest product portfolio in the electric PV space. However, the company is currently hamstrung by the absence of a manufacturing facility in India. With the absence of local production facilities means BYD has to import its EVs to India. This means a hefty import duty of 110% levied on each fully-imported vehicle.

Challenges for BYD in India

This pushes the mid-market brand into the premium end of the market. Recently it was reported that the Government of India is considering dropping tariffs from 110% to 15% on fully imported EVs on certain conditions, however, confirmation on the same is yet to be officially announced. Meanwhile, BYD is taking a hit on its profit by selling its models at a relatively cheaper price than what fully-imported vehicles usually cost. 

The Chinese EV manufacturer is currently on the lookout to establish a manufacturing facility in India. Given India’s strained relations with China on account of the recent cross-border issues, Chinese car manufacturers like BYD and MG Motor (owned by SAIC) have had to face many hurdles to expand their presence in the Indian automotive market. BYD has been present in India since 2007, manufacturing electric buses, but the PV market is the real deal.

BYD entered the Indian PV market in 2021 and currently offers four battery-powered models to Indian consumers, making it the second-largest in product offerings after Tata Motors, which has five models. The company recently launched its fourth model in the country— Sealion 7— priced at Rs 48.90 lakh (ex-showroom). BYD closed 2024 with a 3% market share and a 40% increase in sales, reaching 2,818 units. 

While MG Motor India, joined hands with Mumbai-based conglomerate JSW in March 2024 as a way out for expanding operations in the country, BYD is also said to be exploring all opportunities including partnering with a local entity. According to a PTI article, the Indian government in 2023 rejected a joint proposal by BYD and Megha Engineering and Infrastructure (MEIL) to establish an EV manufacturing plant in Telangana with a planned $1 billion investment. BYD and MEIL already share a strong partnership in the electric bus segment.

BYD plans for India

BYD surely intends to expand its footprint in India and launching a sub Rs 20 lakh EV may be the first big significant step in that direction. Currently, legacy carmakers like Maruti Suzuki, Hyundai, Tata Motors, and MG Motor are eyeing this space. Besides BEVs,  BYD is also considering launching plug-in hybrid vehicles (PHEVs) for the Indian market. Last month, BYD unveiled the PHEV Sealion 6 which claims a whopping 1100 km on a single tank.

With inputs from SWARAJ BAGGONKAR