Chinese Automakers Answer to E.U. Tariffs: Build in Europe

The leafy city of Szeged, Hungary, boasting wide avenues, a respected university and ornate, pale yellow villas near the country’s border with Serbia, looks more like a relic of the Hapsburg empire than the location of Europe’s automotive future.But at a 740-acre construction site there, excavators have already begun preparing for what will be the first European assembly plant of China’s leading automaker, BYD.Large concrete pipes and stacks of metal sheets stand ready, with the cornerstone to be set this fall.Timing is crucial.

The European Union is poised to decide by Oct.30 whether to increase tariffs on electric vehicles entering the bloc from China.

The duties, which come on top of an existing 10 percent tariff, would range from 9 to 35.3 percent and remain in effect for five years.They are significantly lower than the 100 percent tariffs imposed by the United States and Canada, but they come as Chinese automakers are eager to break into the European market.BYD has already been seeking to raise its profile in Europe, working with distributors across 19 countries to offer electric and hybrid models and sponsoring the European Championship soccer tournament this summer.“They have very ambitious plans,” Sandor Nagy, a deputy mayor responsible for urban development in Szeged, said of BYD’s plant, which the company plans to bring online next year.

“And they obviously have a very strong incentive with the tariffs.”Other Chinese automakers, eager to convince Europeans that their cars are fun to drive and more affordable than models made by European companies, are also looking for ways to avoid the tariffs.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want ...