BYD Slams EU's Local Content Plan for Electric Vehicles

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Jun 3, 2026 06:54 PM

Chinese automaker BYD has strongly criticized the European Union's new initiative to impose a "local content" system on electric vehicle production. The criticism comes amid rising tensions in the European automotive sector as it faces increasing competition from Chinese manufacturers.

Details of the Proposed System

The new rules require that electric vehicles be assembled in Europe, with at least 70% of their components manufactured within the region to qualify for financial support. Stella Li, BYD's Executive Vice President, described the measure as "overly complicated, even crazy," warning that it could harm many companies. Li emphasized that political intervention in this sector should be minimal, otherwise the market will lose its flexibility.

Industry Acceleration Act Objectives

The initiative comes under the new Industry Acceleration Act, aimed at protecting European manufacturers facing competitive pressure from cheaper Chinese cars. However, BYD believes these policies could have unintended negative consequences on the market.

BYD's European Investments

Despite the criticism, BYD continues its active investments in Europe. The company is currently building factories in Hungary and Turkey with a combined annual production capacity of 500,000 vehicles. Furthermore, BYD plans to fully localize production of its European market cars by 2028.

The Sensitive Battery Issue

The localization of battery manufacturing, the most expensive component of electric vehicles currently concentrated in Asia, remains a highly sensitive issue. Despite this, BYD shows strong confidence in this area thanks to its vertical integration capabilities.

BYD Among Potential Winners

Even with stricter regulations, the Chinese giant appears ready to adapt, largely due to its ability to control up to 70% of its supply chain. The EU seeks to protect its market, but risks making things difficult even for those willing to invest in the region. Ultimately, those who accelerate localization will win, and BYD is already among them.