Chinese giant BYD is weighing expansion options in India beyond local vehicle manufacturing, including setting up local assembly operations to meet rising demand for its electric vehicles and bypass high import tariffs.
The information was first reported by Bloomberg on Wednesday, citing sources close to the matter.
Last year, the company sold 5,500 vehicles there, a year-over-year jump of around 88%, despite the import tariffs of up to 110% imposed by the Indian government.
Evaluating the assembly in India, the contacts clarified that BYD is working on obtaining local safety and regulatory certifications for more models due to the import duties.
In July 2023, India rejected the Shenzhen-based automaker’s $1 billion investment proposal for a full assembly factory in the nation, amid intensified scrutiny of Chinese companies.
This has since softened due to the import tariffs imposed by the US last April, which affect both countries.
BYD is currently considering assembling semi-knocked-down (SKD) kits in India, described as “cheaper and easier to clear in terms of regulatory approval”, according to insiders cited by the outlet.
With this method, the levies imposed by New Delhi would be cut from 70% to 30%.
Any production plans would follow visits by BYD executives to the country, as explained by the sources familiar with the matter.
Some of the automaker’s engineers and managers have visited India since last year, though senior executives who planned trips in 2024 have delayed their travel, according to sources.
A company spokesperson did not respond to Bloomberg‘s emailed request for comment on its India strategy.
Lineup in India
In India, BYD currently offers four electric models: the Atto 3 and Sealion 7 SUVs, the Seal sedan and the eMax7 multi-purpose van (MPV).
The cheapest model is the Atto 3, which is priced from 2,499,000 rupees ($27,200), followed by the fully electric MPV, starting from 2,690,000 rupees ($29,300).
The Seal sedan is available from 41,00,000 rupees ($37,300), while the Sealion 7 SUV/coupé starts at 49,400,00 rupees ($44,900).
According to the media outlet CarWale, the company plans to launch its Atto 2 model in the country in May, with a price estimate range between 1,800,000 and 2,500,000 rupees – equivalent to $19,600-$27,200.
BYD Exports
With 4,602,436 new energy vehicles (NEV) sold globally last year, BYD‘s deliveries increased 7.7% compared to 2024, meeting its revised annual target of 4.6 million units.
After recording nearly 1.05 million exports in 2025, the Chinese automaker announced on Saturday its sales target outside China of 1.3 million units.
Last year, BYD surpassed the US giant Tesla in fully electric vehicle global sales for the first time.
Tesla in India
Tesla expanded to India in mid-2025.
The company has experienced weaker-than-expected demand in the country, where it offers its Model Y midsize SUV.
High tariffs on imported vehicles forced the company to price the model at around $70,000.
Bloomberg reported earlier this month that Tesla was offering discounts of up to 200,000 rupees ($2,200) on unsold Model Y inventory in India.
The company imported about 300 vehicles to the country, but roughly 100 remain unsold after early reservation holders canceled their orders, according to the report published on January 15.
India and EU Agreement
Seeking to reduce dependence on the US amid strained ties, India and the European Union (EU) concluded negotiations on a long-awaited free trade agreement in goods and services on Tuesday.
A day earlier, Reuters previewed the announcement, citing two sources familiar with the matter.
The two markets represent roughly 2 billion people, with India ranking as the world’s third-largest auto market after the US and China.
Under the agreement, India will reduce tariffs on EU vehicles from 110% to 10% over five years, capped at 250,000 vehicles annually.
Cars priced above €15,000 will see tariffs cut 30 to 35% initially, declining to 10% over five years, while cheaper EU vehicles remain excluded.
Additionally, EV levy cuts are set to begin from year five of the deal.
