China's SWM Motors is gearing up to launch production at a plant in Turkey’s southwestern Eskisehir province in the last quarter of this year, Burak Azmanoglu, a director at SMW Turkey, told local TV channel HT Spor on May 13.

The plant will have an annual production capacity of 25,000 vehicles. It will produce plug-in hybrid and gasoline sports utility vehicle (SUV) models, namely the G01F and G03F.

The company plans to halt SWM imports from China and some of the plant's output will be exported.

The auto factory will be launched as a JV by Atmo Group and Urzema Holding.

Atmo is a Russian auto distributor. It is also the Turkey distributor of SWM and Chery, another Chinese carmaker.

Local conglomerate Urzema is owned by the Ozturk family. It produces equipment for land and rail vehicles.

Tactical move to draw in the Chinese

In June 2024, Turkey imposed a 40% additional tariff on imports of vehicles from China. In a subsequent move, an exemption was provided to Chinese companies that can point to a production plant in Turkey.

The tactics were widely seen as designed to encourage Chinese automakers to set up production plants in Turkey, a country on the doorstep of the European market.

In July 2024, BYD (Build Your Dreams/Shenzhen/002594), the world's largest electric vehicle (EV) maker and first Chinese auto investor in Turkey, signed an agreement with the Turkish industry ministry to build a production plant in Manisa province.

The plant will have an annual EV and plug-in hybrid vehicle production capacity of 150,000 units.

Tariff exemption

A BYD import tariff exemption came into affect with the signing of the agreement for the plant. The company is currently importing vehicles from China with the tariff zeroed.

BYD's EV production stands at around 3mn vehicles/year.

BYD's plant in Turkeys is expected to start production in March 2026. The company is also building a production facility in Hungary, due to commence operations in October.

It is anticipated that BYD's Turkey and Hungary plants will manufacture a total of 500,000 cars/year at full tilt.

No confirmations on Chery or MG

Turkey is the third largest vehicle producer in Europe. It hosts production plants of leading world auto manufacturers. A total of 13 auto brands, including eight global brands, are produced in Turkey.

The Turkish government has, meanwhile, been pressing Chery to launch a production plant in the country. However, the company has yet to announce a final decision on the matter.

Turkish company Dogan Trend Otomotiv, the distributor of MG brand vehicles in Turkey, is also in talks to launch a production plant in Turkey.

No production, no sales

As a result of its tax advantage, BYD’s sales in Turkey have been booming, while the sales of other Chinese carmakers, namely Chery, SAIC Motor (MG), Skywell and Leapmotor, have been nosediving.

Other Chinese carmakers, namely Seres, Maxus, Hongqi, DFSK and NETA, are also present on the Turkish market.

In 2025, BYD, aims to sell 50,000 vehicles in Turkey. It sold 8,331 in 2024.

In January-April this year, BYD sold 13,608 vehicles in Turkey, making it the EV sales leader.