China’s BYD open to building cars in Canada, buying out rivals

While competitors pivoted back to fossil fuel burning engines, BYD has grown to prominence by producing both all-electric and hybrid gas-electric vehicles. Photo by Sean Gallup/Getty Images

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BYD Co., China’s largest car manufacturer, is actively considering building a plant in Canada while also keeping its options open to acquire a more established global automaker.

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The Shenzhen-based automaker is studying the Canadian market for a potential manufacturing facility, although no decision has been made, executive vice president Stella Li said in an interview, adding that BYD would want to own and operate such a factory.

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“I don’t think a JV will work,” Li said, speaking during a visit to Sao Paulo.

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Li also signalled BYD may be interested in taking over a legacy carmaker at a time when some American, European and Japanese rivals are struggling to stay competitive in global markets — stretched by investments in their gas-only and electric vehicle operations. BYD has grown to prominence by producing both all-electric and hybrid gas-electric vehicles.

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“We’re open to every opportunity we have,” she said, noting that while no deal is currently close, her company is evaluating potential assets. “We’ll see what benefits us.”

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Li didn’t mention any potential acquisition targets, but such a move wouldn’t be unprecedented — China’s Zhejiang Geely Holding Group Co. bought Volvo Cars more than a decade ago. More recently, some Western automakers have stepped up efforts to tap Chinese carmakers for technological assistance and production capacity.

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Stellantis NV is considering tapping electric-vehicle technology from its Chinese partner Leapmotor and is exploring deals with Chinese carmakers for investment in Europe. Ford Motor Co. has held discussions with Geely about shared capacity in Europe.

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BYD has had joint ventures in the past, but its current “go-it-alone” philosophy reflects a commitment to its own efficiency measures such as a vertical integration strategy to keep much of its supply chain in-house.

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United States is ‘Complicated’

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For now, the world’s biggest EV maker is shelving any ambitions it may have for entering the U.S., which Li called a “complicated environment.” Chinese automakers have faced steep tariffs and a ban on connected car technology in the U.S., which has effectively kept out most mass-market models made in China.

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Instead, BYD is focused on markets where it can apply its “Brazil model,” using the marketing and sales success it found in South America in other regions such as Europe. Li said the company is ramping up its first European passenger vehicle hub in Hungary and weighing a second project in Turkey. That comes as part of a broader push overseas.