BYD considering SKD assembly factory in India with EV orders piling up
BYD are considering and exploring options to set up a unit for assembling vehicles from semi-knocked-down, following the rise in sales numbers and increasing customer wait.
New Delhi: BYD are reassessing how they operate in the country following the surge in demand for electric vehicle went beyond what the current import law allows. People close to the matter have said that the Chinese automaker is exploring ways to increase supply, including assembling vehicles, as dealer order books continue to overflow.
The discussions come at a time when BYD’s India operations are facing pressure from import limits that restrict the number of completely built vehicles they can bring in annually, as sales numbers climb.
India had previously turned down BYD’s proposal to set up a full production facility, but the brand is now understood to be considering assembling vehicles from semi-knocked-down kits. This would let BYD avoid certain regulatory complexities associated with full-scale manufacturing while also bringing down the duties.
Media sources also said that the automaker is concurrently working to secure local safety and regulatory approvals for additional models, a step that might help it operate under India’s import setup more coherently.
SKD only sensible option amidst growing sales numbers
BYD sold about 5,500 vehicles in India in 2025, a surge of 88 per cent as compared to the year before. This growth has increased the brand’s ability to comply with rules that cap imports of each fully made model at 2,500 units. Most of BYD’s inventory for the December quarter has already been sold, according to sources familiar with the situation, leaving dealers with limited stock and customers with long waiting periods.
Despite the import duties that can go as far as 110 per cent, BYD has managed to price their vehicle aggressively. The Atto 3 EV SUV starts at Rs 25 lakh and sits at the upper end of the mass-market EV segment, competing with the likes of Tata Motors and Mahindra & Mahindra.
BYD's competitive pricing keeps them in race
There’s also the Sealion 7 priced between Rs 49 lakh and Rs 55 lakh, sold about 2,200 units last year and remains cheaper than Tesla’s Model Y, which starts at about Rs 60 lakh in the country. Tesla has offered discounts to increase demand under the same tariff scheme.
Switching to SKD assembly could reduce import duties to about 30 per cent, compared with about 70 per cent for completely made vehicles. BYD have raised concerns with Indian auto regulators that, at present, import limits could slow their expansion plans. A production decision is expected to follow visits by BYD senior executives, although some planned trips by top management had to be delayed last year.
For BYD, renewed focus on India reflects the brand’s effort to reduce reliance on its home market, where EVs have become moderate amidst ongoing subsidy rollbacks and heavy competition as well. The carmaker is targeting a sharp rise in overseas deliveries for 2026. Diplomatic relations between China and India have improved slightly over the past few months, but the policy supporting BYD remains rocky in India.