BEIJING — Chinese electric vehicle giant BYD is embarking on a rapid global expansion to challenge Tesla but for now it's stuck in the slow lane on its rival's home turf.
While BYD has not fully articulated its global ambitions in public, a concerted worldwide push has become the single most important strategic focus for China's biggest EV maker, four sources familiar with BYD management's thinking said.
Besides a drive into some European markets already underway, BYD spent much of last year conducting a study on how to set up a U.S. distribution network for its latest electric models, two of the sources said.
They described the study as advanced and serious, with specific recommendations from Detroit consultancy Urban Science on how many outlets in each state and city BYD would need, as well as formats for the brick-and-mortar stores.
The momentum was building toward an announcement at this year's global CES tech show in Las Vegas, where BYD was planning to showcase a new generation of battery electric vehicles and plug-in hybrids for the U.S., a BYD official said.
The announcement never came.
Tense relations between Washington and Beijing, anti-China sentiment in the United States and President Joe Biden's move to prioritize home-grown production of EVs and batteries all pushed BYD to hit the pause button, one of the sources said.
BYD's management has yet to give the project a final green light and an aggressive U.S. expansion remains unlikely for the foreseeable future, the source said.
"BYD is taking a cautious approach to the U.S.," the person said. "Think about all the U.S.-China political tensions and then think about the craziness of the whole world now. You don't want to jump into a big mess."
BYD's U.S. project was complicated by the Biden administration's Inflation Reduction Act, which imposes rules on where to source battery materials and disqualifies EVs produced outside North America for a $7,500 purchase rebate.
"Who would start selling cars with a $7,500 disadvantage?" said another of the sources.
BYD declined to comment for this report.