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China’s BYD breaks ground on EV battery plant, betting nearly US$1 billion despite concerns of oversupply
- New plant in Wenzhou, in east China’s Zhejiang province, will produce enough batteries to power 200,000 electric cars per year
- Announcement comes two weeks after plans came to light for BYD to build a US$1.2 billion battery plant in Henan province
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Daniel Renin Shanghai
BYD, the world’s largest electric vehicle (EV) maker by sales, has started construction of a new battery plant in Wenzhou, in east China’s Zhejiang province, raising its bet on the country’s electrification drive.
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The Shenzhen-based carmaker and EV battery producer’s new facility will be able to churn out 20 gigawatt-hours (GWh) of batteries annually when construction is completed – enough to power about 200,000 electric vehicles.
The first phase of the factory, with planned investment of 6.5 billion yuan (US$936 million), will employ 6,000 and generate annual sales of 16 billion yuan when it becomes operational in early 2024, according to a statement by Wenzhou’s city government.
The announcement comes two weeks after an environmental-assessment report revealed BYD’s plan to build a US$1.2 billion battery plant in Zhengzhou, the capital of central Henan province.
“Top players like BYD do not seem to be worried about overcapacity, as they continue to expand production,” said Gao Shen, an independent analyst in Shanghai. “It is expected that more car assemblers will use BYD as their battery supplier.”
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