China’s BYD to locally assemble its EVs in India? Here’s what we know

BYD is reportedly exploring local assembly options in India as demand for its electric vehicles rises sharply. The Chinese automaker's sales in India increased by about 88 per cent last year, reaching nearly 5,500 cars. This growth is, however, limited by rules that restrict imports of fully built models to 2,500 units annually.

According to a report in Bloomberg, to address these constraints, BYD is considering local assembly and working on obtaining safety and regulatory approvals for more models. The company currently sells the Atto 3 compact e-SUV and the eMax7 multipurpose vehicle, both allowed beyond the import quota, along with the Sealion 7 and Seal sedan.

High import duties, which can reach up to 110 per cent for fully built cars, influence BYD's strategy. The Atto 3, priced from Rs 25 lakh even with a 70 per cent tariff, competes with local brands like Mahindra & Mahindra and Tata Motors, and is priced below Tesla's offerings.

India had earlier rejected BYD's plans for a full assembly plant, but the company is now considering semi-knocked down (SKD) assembly, the report said. This approach would be cheaper and easier to approve, potentially reducing tariffs from 70 per cent to 30 per cent, allowing more flexibility in pricing and supply.

Strong demand has led dealers to hold hundreds of bookings. BYD has approached Indian regulators to highlight how import restrictions may limit growth. Most inventory in the December quarter has been sold out, unlike Tesla, which continues to face challenges due to tariffs.

Some BYD executives had visited India since last year, though planned visits by senior officials were delayed. Policy support for expansion remains inconsistent despite improving India-China relations and resumed direct flights.