Earlier in 2024, the electric vehicle (EV) giant, BYD (Build Your Dream), became the first official Chinese carmaker to sponsor and partner with the European football championship, UEFA EURO 2024. The partnership underscores the ambitions of BYD, a lesser-known EV firm outside China, which is keen on expanding brand awareness in Europe and across the world.
While tariffs and political tensions between China and Western economies may slow its growth, in the long run it is unlikely to have a major adverse impact on BYD’s EV endeavours as it expands its footprint globally.
BYD – the first Chinese carmaker to sponsor the UEFA EURO football championship
BYD became the first Chinese automotive manufacturer to sponsor the UEFA EURO 2024 football championship, replacing its rival, Volkswagen. It will support sustainable mobility by facilitating green transport solutions for fans and teams during the tournament with its latest EV models.
According to BYD, the tournament will be used to promote its state-of-the-art technology globally and build brand awareness in the European market. UEFA’s commercial chief, Guy-Laurent Epstein, is predicting achieving a cumulative audience viewership of more than five billion globally at EURO 2024, beating the record held at the EURO 2020 championship.
With less than 20 years in the automotive industry, the exposure will play to BYD’s advantage as it battles with established players.
In 2023, BYD was the leading manufacturer of EVs (BEVs, or battery electric vehicles, and PHEVs, plug-in hybrid electric vehicles) worldwide, reaching just under three million units
Source: Euromonitor International
However, it was only the 10th largest automotive company globally when measured across all light vehicle powertrains.
BYD looks to fuel international expansion efforts with Europe as a key target
With 97% of its sales being concentrated in China, BYD is looking to catapult its international expansion strategy. Europe, which only accounted for an estimated 0.5% of BYD’s global sales, remains a major opportunity amid cooling political and economic relations with the US.
Between 2023 and 2030, new registrations of EVs are forecast to more than triple to 9.7 million in Europe, making the region a strategically important battleground for BYD’s global expansion efforts.
Tariffs and political challenges may slow BYD’s ambitions
However, penetrating the European market will not come without challenges. The ongoing political divide between the West and the East has put Chinese EV companies in a somewhat hostile position, with the Biden administration slapping 100% tariffs on EVs imported from China into the US, in May 2024.
This was followed by the EU, weeks later, introducing tariffs of up to 38% on imported Chinese EVs. BYD’s tariffs will only stand at 17.4%, on top of the standard 10% car duty tax, as it was seen to cooperate with the EU, and benefited less from the government subsidies compared to other Chinese EV companies such as SAIC and Geely.
The tariffs imposed by the EU surfaced following reports that the Chinese government subsidised its EV companies, allowing SAIC, Geely and others to provide more cost-competitive vehicles in the European automobile market.
Political challenges are unlikely to have a significant impact on BYD’s EV endeavours
Nonetheless, the new EU tariffs, due to go into effect in July 2024, are unlikely to have large repercussions on BYD. According to the Secretary General of the China Passenger Car Association (CPCA), Cui Dongshu, the tariffs are within expectations and are not set to have a major impact on EV sales in Europe.
In addition, BYD plans to open its first European EV factory within three years in Hungary. The plant will be dedicated to EV production for the European market and, importantly, will help it circumvent the EU’s tariffs on EV exports from China. This follows BYD’s existing expansion strategies in various emerging market economies across Latin America, Africa and Asia as it focuses on brand awareness and sales growth outside China.
Between 2023 and 2030, new EV registrations are predicted to grow by 201%, worldwide
Source: Euromonitor International
Through its EURO 2024 sponsorship, BYD is throwing down the gauntlet to its competitors and consolidating its position as the leading EV mobility provider.
Learn more about EVs in our report, EV Readiness Index 2023, to identify the best-prepared markets for the EV transition.