BYD Explores Local Assembly in India as Hundreds of EV Orders Pile Up

Chinese electric vehicle (EV) manufacturer BYD Co. is evaluating options to expand its presence in India, including establishing local assembly operations, as demand for its EVs increases sharply amidst stringent import restrictions, people familiar with the matter told new agency Bloomberg.

The EV maker is assessing semi-knocked-down (SKD) or similar assembly models and is also working on securing local safety and regulatory certifications for additional models, the sources said. The plans remain at an exploratory stage and have not been publicly disclosed.

The shift to local assembly could mark a key development in BYD's India strategy, letting the Chinese manufacturer to better serve growing demand while navigating regulatory constraints on Chinese investments.

Also read: India to Cut Import Tariffs on EU Cars Under Proposed Free Trade Pact: Report

India had previously rejected BYD's proposal to establish a full-scale manufacturing facility, amid intensified scrutiny of Chinese investments. However, the automaker is now considering assembling semi-finished components locally, a route regarded as more economical and easier to clear from a regulatory perspective.

Any progression towards local assembly is expected to follow visits by senior BYD executives, the people said. A spokesperson for BYD did not respond to queries seeking comment.

BYD's reassessment arrives as demand in India exceeds its capacity to supply vehicles under existing import regulations. Dealers are reportedly holding hundreds of customer bookings, with much of the inventory for the December quarter already exhausted.

BYD's India sales climbed approximately 88 per cent last year to around 5,500 units, despite import duties of up to 110 per cent on completely built vehicles. Growth has been limited by regulations that restrict imports of each fully built model to 2,500 units.

Local SKD assembly could reduce applicable tariffs to around 30 per cent from 70 per cent, substantially improving pricing flexibility.

The situation differs markedly from that of Tesla Inc., which has been offering discounts on some variants in India to stimulate demand. BYD's relatively competitive pricing, even with elevated import duties, has helped it gain traction in the premium end of India's mass-market EV segment.

The Atto 3 electric SUV starts at around ₹25 lakh, positioning it alongside models from Tata Motors Passenger Vehicles and Mahindra & Mahindra, whilst still undercutting Tesla.

The Sealion 7, priced between ₹49 lakh and ₹55 lakh, is also more affordable than Tesla's Model Y, which starts at approximately ₹60 lakh.