China's largest electric car maker BYD is preparing to review its strategy in Europe after a series of failures, including a lack of registered dealers, a lack of executives with local market experience and a refusal to offer hybrid models in places where fully electric cars have not yet gained widespread popularity, Reuters reported, citing current and former employees of the company.
BYD responded quickly to a series of strategic miscalculations. The company began to actively expand its dealer network and offer generous compensation packages to top managers from European automakers, including Stellantis.
BYD announced in December that hybrid cars would be a key part of its European strategy, a decision that came after the company’s European adviser, Alfredo Altavilla—one of its key new managers—told founder Chang Qianfu that a focus on electric cars alone had not paid off in many European countries.
"He was very quick to get the message and give the input to BYD's engineers that every new model would have to come both in EV and hybrid" versions for Europe," Altavilla told Reuters in an interview. "It is necessary to educate customers in the green transition."
In particular, in December, Altavilla stated that hybrids would be the cornerstone of BYD's European strategy, emphasizing that ignoring consumer preferences would be a mistake.
BYD first approached Altavilla in June 2024 and appointed him as a senior advisor in August. He brought in several managers from Stellantis who were later appointed as executives in Germany, Italy, Spain and other European countries. The company attracted them with high salaries and career prospects. Also last year, BYD appointed Stella Li, its second-ranking executive, to lead the European region.
The previous head of the region, Michelle Shu, assured that BYD would reach at least 5% of the European electric car market by the time the company's first factory in Hungary opens. However, the launch of production is scheduled for the end of this year, while BYD's share currently stands at only 2.8% - about 57 thousand cars sold.
Another key factor in the reassessment of the European strategy has been the emergence of a growing number of Chinese carmakers planning to enter the European market. Most of them are forced to seek growth outside China due to a prolonged price war and fierce competition in the domestic market. BYD's updated strategy has already begun to bear fruit - in the first quarter of 2025, the company sold 37,000 cars in the UK, compared to only 8.5 thousand in the same period in 2024.
The main problem with BYD entering the European market in 2023 was the lack of a deep understanding of regional specifics. The then head of the European direction, Michelle Shu, noted that the company had an ambitious goal of becoming the largest supplier of electric vehicles in Europe by 2030. However, due to insufficiently thorough prior study of the market, BYD faced a number of challenges that it is currently trying to overcome.