Yahoo Finance Europe's Forvia talking to more Chinese automakers looking to set up in Europe
By Nathan Vifflin
(Reuters) - Car parts supplier Forvia, on Thursday said it is negotiating with two more Chinese carmakers seeking to expand production in Europe as it tries to reduce its dependency on China's BYD.
Car parts makers like Forvia, hurt by lagging global car sales, are seeking to take advantage of Chinese carmakers spreading their wings and looking to challenge legacy rivals on their home turf.
"BYD is having a fairly clear and advocated plan in Hungary[...]. And we know also that other Chinese OEMs are considering also sites in Europe. I know at least two with whom we are negotiating," said Olivier Durand, Forvia's Chief Financial Officer during a press conference following a first quarter sales update.
BYD, a major Chinese carmaker planning to start vehicle production in Hungary, created a joint venture with Forvia in 2017 in Thailand.
Forvia said it aims to reduce its dependency on BYD after sales fell between the groups over the first quarter, instead turning to other makers such as Li Auto, Chery and Leapmotor.
Sales growth between Forvia and Li Auto, Chery, Leapmotor have grown double digits over the first quarter, Forvia said in a statement.
"The development of the China OEM (original equipment manufacturer) offer is not only about China, and not really only about Asia, it's also in Europe," the CFO said.
On Wednesday, Italy's Industry Minister Adolfo Urso said it is in talks with China's Dongfeng Motor and others to attract them to the country.
On Tuesday, China's Chery Auto signed a joint venture deal to produce cars in Spain, its first factory in Europe.
In March, sources told Reuters Leapmotor will start producing EVs at Stellantis' plant in Poland, making it one of the first Chinese automakers to start production, with delivery planned by the end of the year.
Forvia, which produces parts for Chery, Leapmotors and Stellantis, said more than half of orders worth a total of 6.5 billion euros came from Asia over the first quarter, most of them from China.
(Reporting by Nathan Vifflin; Editing by Elaine Hardcastle)
