| Welcome to the Hyperdrive daily briefing on what's reshaping the auto world. Read the story featured in today's newsletter on the web here, and sign up if you're not already subscribed. BYD is exploring setting up its own factory in Europe, a top executive told Bloomberg News, suggesting the Chinese carmaking giant is more likely to establish its own plant than take over one from Ford in Germany. "We aren't focusing on certain companies' facilities," BYD Executive Vice President Stella Li said in an interview from the company's new North American headquarters in Pasadena, California. She said the carmaker is more interested in building its own plants rather than acquiring other companies' factories. "We're doing feasibility studies to see our plans for the future," Li said. "Like if we set up our facility in that region, what's the best solution out there?" While there are "no target countries to build facilities yet," BYD wants to establish sales and service networks in Europe to ensure consumers are confident in the brand, she said.  BYD Executive Vice President Stella Li. Source: BYD Ford has been in talks with around 15 potential investors in its plant in Saarlouis, German, including BYD, people familiar with the matter have said. The Wall Street Journal first reported the preliminary discussions last month. After wild success at home selling affordable electric cars to the masses, BYD is looking beyond China. It's already announced plans to sell its vehicles across Europe, including in Germany, Sweden, Norway, the Netherlands, France and the UK. It's constructing its first EV production plant in Southeast Asia, in Thailand, and selling cars in Australia, Japan and Singapore. It also has an assembly line in India. However the company, which counts Warren Buffett's Berkshire Hathaway as its largest shareholder, is facing escalating concerns in Europe and the US regarding China's increasingly competitive car industry and the nation's progress becoming an auto-exporting powerhouse. The new climate and energy law enacted by President Joe Biden last year seeks to limit reliance on raw materials from China in the EV supply chain and encourage more companies to make electric cars and batteries in the US. Rival automakers are also concerned about staying competitive. Stellantis Chief Executive Officer Carlos Tavares told reporters in December that "to fight the Chinese, we will have to have comparable cost structures." If that can't be done, he said, Europe will have consider closing its borders — at least partially — to cars imported from China.  A BYD badge on the front grille of a Dolphin compact electric vehicle on display at the Tokyo Auto Salon last month. Photographer: Kiyoshi Ota/Bloomberg Shenzhen-based BYD, which sold 1.86 million pure-electric and plug-in hybrid cars last year, mostly in China, is concentrating its efforts around Asia, Europe and Latin America in its quest to dominate the cleaner transportation segments ranging from cars to buses. Li was dismissive of Biden's Inflation Reduction Act, questioning whether it's helping the US to be competitive in EVs or helping US consumers enjoy "the best, the most innovative technology." BYD sees China and Europe leading EV adoption with penetration rates of more than 30% in the near term. In Latin America, BYD plans to be in every major market, taking an aggressive approach to signing up dealers to sell not just passenger cars, but commercial vans, buses and taxis. BYD wants to move EV adoption rates in Latin America to 10% to 20% in the next three to five years, from less than 2% now, Li said. She expects this change will start in corporate and government fleets. In addition to car manufacturing plants, BYD is "definitely" looking to build a battery facility outside of China. In addition to making its own cells, the company produces semiconductors in-house. While Li played down BYD's interest in taking over existing plants from other companies, there have been discussions in the past. In November, BYD said it was talking with Brazil's Bahia state about potentially taking over ex-Ford facilities. In December, the company told Bloomberg it was looking at potentially setting up more than one European plant to produce electric cars.  A low-emission Volvo truck last month in Modesto, California. Photographer: Benjamin Fanjoy/Bloomberg The truckmaker Volvo joined a growing roster of manufacturers cautioning that Europe risks losing out as a result of the Inflation Reduction Act making the US a more attractive market to make and sell electric vehicles. "If nothing happens in Europe, we will have to think about where we're going to put the initial investments to scale up capacity for some of the technologies in the value chain," Volvo Chief Executive Officer Martin Lundstedt said in an interview. "This is not a threat, it's driven by customer demand and where volumes will accelerate." Like getting this newsletter? Subscribe to Bloomberg.com for unlimited access to trusted, data-driven journalism and subscriber-only insights. | 
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