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China’s BYD steps up globalisation strategy with an electric-car plant in Uzbekistan targeting Central Asia

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BYD, the world’s largest electric vehicle (EV) maker, is making inroads into Central Asia with plans to set up a factory in Uzbekistan.

The Shenzhen-based carmaker backed by Warren Buffett’s Berkshire Hathaway said that its joint venture with Uzavtosanoat JSC will produce cars starting next year.

“Production will commence in Jizzakh in 2024, starting with two bestselling BYD plug-in hybrid models, the BYD Chazor and the BYD Song Plus DM-i,” BYD said in a statement on Monday evening. “It marks an exciting new chapter of electric car innovation in Uzbekistan, a country where the government is actively promoting green and low-carbon transformation, recognising the advantages of new-energy vehicles to reduce emissions and become less dependent on traditional energy resources.”

The joint venture, which was formed in December 2022, will engage in the full production cycle, including welding, painting and assembling. The cars will also be sold in other Central Asian nations.

BYD will make the Chazor compact EV in Uzbekistan. Photo: Handout

Jizzakh, which is nearly 190km to the southwest of the capital Tashkent, is the heart of Uzbekistan’s car industry. Uzbek President Shavkat Mirziyoyev said he plans to attract US$700 million in investments from Chinese and Korean companies among others, local media reported in July. A plant established in November 2020 produces Kia, Renault and Lada cars.

BYD did not reveal the size of its investment or the capacity of the plant. The Chazor is a compact EV and the Song Plus DM-i plug-in is a hybrid compact SUV.

The announcement comes after BYD reported its best ever monthly sales on the Chinese mainland, consolidating its foothold in the world’s largest EV market. Sales rose 4.8 per cent month on month to 287,454 units in September, a fifth consecutive month of gains.

The company began exporting cars to Uzbekistan in March this year, and has opened sales and service centres to deliver more than 5,000 units this year.

“BYD’s go-global strategy is accelerating due to its manufacturing heft and high-quality batteries,” said Chen Jinzhu, CEO of consultancy Shanghai Mingliang Auto Service. “Emerging markets like Central Asia and Southeast Asia are its main targets for now.”

BYD, which dethroned Tesla as the world’s largest EV maker in 2022, began aggressively tapping overseas markets last year, with its dual-pronged strategy of selling its Chinese-made cars and setting up plants overseas to ­produce vehicles for those markets.

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Behind the scenes at BYD Auto: China’s biggest electric vehicle factory

Behind the scenes at BYD Auto: China’s biggest electric vehicle factory

In July, BYD said it would invest US$620 million in an industrial complex in Brazil’s northeastern Bahia state. It is also building a plant in Thailand, due for completion next year, with an annual capacity of 150,000 cars.

In May, BYD signed a pre­liminary ­agreement with the Indo­nesian government to produce EVs in Southeast Asia’s largest economy.

Last month, Swiss bank UBS said in a report that Chinese EV makers’ efficient control of the supply chain and a cost edge in batteries will make their cars more attractive to overseas customers.

Meanwhile, China’s challenging economic outlook will intensify globalisation efforts by BYD and its domestic rivals, the report said.

BYD’s chairman Wang Chuanfu told analysts in August that Chinese NEV players have a competitive edge over overseas players, with a lead of three to five years in terms of technology and scale, and five to 10 years in terms of cost advantage.

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