BYD Shifts to Acquiring Existing Plants for European Expansion, Second Vehicle Plant Likely in France or Spain

Following the upcoming production launch at its Hungarian factory, BYD is further expanding its local production capacity in Europe.

According to multiple media reports, Alfredo Altavilla, BYD's Special Advisor for the European market, stated on September 16 at a Denza brand event in Turin, Italy, that in the long term, BYD needs to establish three vehicle assembly plants and one battery factory in Europe to support business growth and comply with European regulations.

This includes BYD's first European vehicle factory, announced in December 2023, which is being built in Szeged, Hungary, and has now entered the production launch phase.

Second Plant Expected by End of 2026

Altavilla revealed that the location for the second vehicle assembly plant is expected to be confirmed by the end of 2026. Unlike the newly built factory in Hungary, BYD aims to acquire and retrofit an existing facility. France and Spain are currently the most viable options, with Italy serving as a backup plan. He did not disclose details regarding the location or planning progress for the third assembly plant or the battery factory.

Explaining the shift toward acquiring existing plants, Altavilla said the company needs facilities that can be purchased quickly and retrofitted with relatively low investment to accelerate local mass production in Europe. He noted that BYD has a team continuously evaluating various factories and that he frequently travels across Europe for inspections.

BYD's Official Response

When Caijing sought confirmation from BYD regarding its European factory progress, the company responded that relevant information should be based on official announcements.

Previous Statements on European Expansion

In June 2026, BYD Executive Vice President and Head of Overseas Business, Li Ke, said in a media interview that the Szeged factory in Hungary would begin vehicle assembly in the fourth quarter. She added that Hungary is the company's current top priority and that work on a factory in Turkey had been suspended to focus on European production. In a 2025 interview, she had referred to Turkey as BYD's second European factory after Hungary and mentioned that the company was considering a third plant.

Shift Toward Acquiring Existing Facilities

Since the beginning of this year, BYD has shifted its strategy for the second European factory toward acquiring and retrofitting existing production capacity. The search for potential sellers has been ongoing for several months. In May of this year, Li Ke told media in London that BYD was in discussions with Stellantis and other European automakers about taking over factories with underutilized capacity.

Overview of Potential Factory Options in Spain

Based on publicly available information compiled by Caijing, several major vehicle factories in Spain with significant spare capacity already have plans to introduce partners or new models:

• Ford's Almussafes plant in Valencia: Designed annual capacity of approximately 500,000 vehicles; produced only 48,400 units in the first half of 2026. In July, Ford announced a joint venture with Geely, with each holding 66% and 34% stakes respectively, and plans to introduce new models by 2028.

• Stellantis' Villaverde plant in Madrid: Utilization has declined significantly. The plant reduced to single-shift production earlier this year, producing approximately 30,800 vehicles in the first half of the year, a 42% year-on-year decline. The plant has a clear ownership transfer plan: Stellantis announced in May its intention to transfer it to the Spanish subsidiary of Leapmotor International and arrange production of Leapmotor models.

• Stellantis' Figueruelas plant in Zaragoza: Annual capacity of approximately 500,000 vehicles; production dropped to 142,500 units in the first half of this year due to production line modifications. The plant will produce Leapmotor's pure electric SUV B10 and Opel's electric SUV. A battery factory jointly built by Stellantis and CATL is under construction nearby.

• Renault's plant in Palencia: Has significant spare capacity, with a maximum annual capacity exceeding 300,000 vehicles. Production in the first half of this year was approximately 60,000 units. Renault announced a reduction to single-shift production starting in July. However, in a new labor agreement signed in June, Renault committed to allocating three new models to the plant, two based on a multi-energy platform and one hybrid model.

Other Spanish Plants with Existing Plans

Other major vehicle factories in Spain also have new production arrangements:

• Stellantis' Vigo plant: Produced approximately 560,000 vehicles in 2025 and has plans to introduce a new-generation small electric vehicle platform.
• Renault's Valladolid plant: Has received commitments for two new hybrid models.
• Volkswagen's Navarra plant and SEAT's Martorell plant: Both are advancing their electrification transitions.
• Barcelona plant (formerly operated by Nissan): Has been restarted by Spanish automaker Ebro in partnership with Chery and is now in the production ramp-up phase.

No Confirmed Deals Yet

As of now, no public information indicates that BYD has advanced cooperation with specific factories in Spain or France. Some automotive media have previously analyzed that the former Smart factory in Hambach, Moselle department, northeastern France, could be a candidate.

Italy: A Backup Option

At the Turin event, Altavilla also specifically addressed the question of setting up a factory in Italy. The Italian government had previously courted BYD to establish a factory there, hoping to attract a major automaker beyond Stellantis to expand local vehicle production. In February 2024, BYD's Europe head confirmed that the two sides had been in contact.

However, Altavilla stated at the Turin event that Italy is currently only a "backup option," with France and Spain ranking higher. He explained that BYD needs to acquire existing factories that can resume production quickly, and the eligible factories in Italy are not for sale.

BYD had approached Stellantis regarding the former Maserati factory in Grugliasco, near Turin, but found during inspection that the production equipment had been moved to other bases. "I cannot buy something that is not for sale," Altavilla said. He added that the final location decision depends on local competitive conditions and the investment required for factory retrofitting. He also noted that other countries have not been ruled out, and he plans to visit factories in the UK after the Turin event.

About Alfredo Altavilla

Altavilla was appointed as BYD's Special Advisor for the European market in September 2024, bringing decades of experience in the automotive industry. He currently also serves as a senior advisor to a European private equity institution and holds directorships at companies in industrial equipment, automotive services, asset management, and auto parts.

(Image source: Shetu.com)