BYD $1211 (-1,03%) started test production at its first European plant in Hungary on Thursday after the completion of the passenger car factory was delayed.
By producing fully electric vehicles in Europe, the car manufacturer can avoid the tariffs on imported electric vehicles introduced by the European Commission in October 2024.
Production is scheduled to start in the second quarter.
This was announced on Thursday by László Botka, Mayor of Szeged, where the plant is located.
Botka said that the company has hired 960 employees at its plant in Szeged, 70% of whom are Hungarian and most of whom are from Szeged.
In addition, BYD has signed a cooperation agreement with the Faculty of Engineering of the University of Szeged.
Production at the plant will be ramped up to the planned capacity of 200,000 vehicles over several years, with the number of jobs increasing in parallel.
》Factory in Szeged《
Almost a year ago, the European Union launched an investigation into whether China had illegally supported the construction of the BYD plant in Szeged.
The mayor of Szeged, László Botka, rejected the investigation and wrote that the European Commission was merely following EU law and that the investment complied with these regulations.
"Several EU countries wanted to secure the world's largest environmentally friendly electric car factory. The agreement between Szeged, Hungary and BYD complies with all EU regulations," explained Bokta.
The mayor added that the agreement had been negotiated for over a year, "and this was one of the most important aspects. The factory is currently under construction and will create many thousands of well-paid jobs. The economy of Szeged will also experience a new boom."
The Municipality of Szeged provided 300 hectares of land for the factory, of which 100 hectares were already designated as an industrial area, while the remaining 200 hectares were agricultural land shared by several owners.
Most of the landowners accepted the price set by the government authority in the expropriation procedure, but some challenged it in court.
The legal disputes have now been settled, as the court ruled that the purchase prices had been set incorrectly and were higher than permitted.
As a result, the landowners concerned must pay back the difference. Botka said he would propose to the City Council to waive this claim as part of Szeged's 2026 budget.
It remains unclear whether these court cases have contributed to the delay in operations.
Delay in production
The company originally aimed to beat the three-year schedule set when the plant was announced at the end of 2023 and start operations as early as 2025, but the schedule was later pushed back to the first half of this year.
After a Reuters report in June suggested that the launch would be delayed, BYD denied these claims and stated that production would still start on schedule before the end of 2025.
The report cited strategic decisions and internal company planning as the reason for the delay, adding that BYD was prioritizing its plant in Turkey.
However, the Hungarian authorities have publicly denied these claims.
Stella Li, Executive Vice President of BYD, later confirmed that production is now scheduled for the second quarter of 2026 and construction is expected to be completed by the end of the year.
On Thursday, the mayor of Szeged stated that it was not yet known "exactly" when the official opening of the plant would take place.
Gergely Gulyás, Minister in the Prime Minister's Office, said that production would start in the spring.
