BYD wants to build cars in India, but has no 'direct' signal of investment rules easing

China's BYD wants to make cars in India but has received no “direct” signal from New Delhi on a possible easing of stringent investment rules for Chinese businesses, a top executive said, as the carmaker seeks to expand in a fast-growing market.

BYD, in partnership with a local firm, submitted a $1bn (R17.59bn) investment proposal last year to build electric vehicles (EVs) in India, but New Delhi is yet to approve the plan after increasing scrutiny of investments from China following a 2020 border clash.

“The ambition is there but you need a lot of other things. [We] don't have any direct signal,” Rajeev Chauhan, head of BYD's passenger EV business in India, said when asked whether it had received any signs of an easing of investment rules.

“We hope things will become better. That is the time we would like to think a little more on this subject,” he said in an interview, referring to plans to build cars in India.

Increased scrutiny of Chinese businesses has already forced BYD rival Great Wall Motor to shelve plans to invest $1bn in India, the world's third-largest car market.

BYD is a small player in India, where it has invested $200m (R3.5bn) and only sells imported EVs such as the Atto 3 SUV and Seal sedan. India is an important market for the car and battery-maker, which is rapidly expanding globally.

Making cars locally would help BYD launch more competitively-priced EVs in India. While it waits for investment approval, it is targeting wealthy Indian buyers with its imported premium EVs, Chauhan said.

“There are a lot of players in the mass segment and quite a few players in the luxury segment. The premium segment, that's where we are trying to reach and position. This is a space where we feel we belong, our cars belong,” he said.

Chauhan said BYD can build a niche for itself in the $24,000 to $60,000 (R422,104 to R1,054,974) price bracket where competition is low.

BYD launched on Tuesday a seven-seater family car in India called the eMax 7 priced at $32,000 to $35,500 (R562,652 to R624,192), with a range of 420km to 530km on a charge.

BYD sold about 2,300 cars in India in 2023, government data showed, and Chauhan expects to surpass that this year having already sold more than 1,900 EVs in the first nine months of 2024.

India's EV market, where local carmaker Tata Motors has about a 70% share, is small but growing. EVs made up about 2% of the 4.2-million cars sold in India last year and the government wants this to reach 30% by 2030.