Recently, China's new energy vehicle leader BYD announced that it has signed a strategic cooperation agreement with the Azerbaijani government to build an electric bus manufacturing base in the country's Sumgait Chemical Industrial Park. The agreement was reached during the 29th Conference of the Parties (COP29) to the United Nations Framework Convention on Climate Change (UNFCCC).

Under the agreement, BYD will localize its production in Azerbaijan, aiming to increase localization to 40 percent by 2030. The first phase of the project, with an investment of about $17.1 million, will be used to set up a joint-venture plant with an annual capacity of up to 500 electric buses. The plant will not only meet domestic demand, but will also cater to the export market, with plans to create 600 local jobs.

Azerbaijan's First Deputy Minister of Economy, Ernur Aliyev, said the core objective of the project is to enhance the efficiency and environmental friendliness of the public transportation system, while promoting the application of high technology and economic diversification. He emphasized, “With this cooperation, Azerbaijan is not only taking a step forward in the transition to clean energy, but also demonstrating our commitment to support global action on climate change.” In addition, the Azerbaijan Investment Corporation OJSC will join the project as a shareholder, while BYD's partner is Electrify Azerbaijan LLC, part of the SARDA Group.

Earlier this year, BYD has completed the delivery of 160 12-meter K9UD electric buses to Azerbaijan, which have been put into operation as a pilot project on public transportation routes in Baku, providing a strong green travel guarantee for the upcoming COP29. This successful experience has laid a solid foundation for both sides to deepen cooperation.

In addition to electric buses, BYD also plans to expand its product portfolio in Azerbaijan by exploring the production of electric light trucks, municipal service electric vehicles and passenger electric vehicles in the future. Through these initiatives, BYD hopes to further develop Azerbaijan's new energy vehicle value chain and help it become a regional production center for clean energy transportation.

Since its establishment in 1995, BYD has grown into a leading global new energy technology company. 2023, the company set a record for cumulative sales of new energy vehicles exceeding 3 million units. In October this year, BYD's new energy vehicle sales reached 502,657 units in a single month, up 66% year-on-year, with overseas markets performing particularly strongly, with exports reaching 28,012 units.

As an important country in the Caucasus region, Azerbaijan has been active in energy transformation in recent years. The country continues to promote the upgrading of local industries through the introduction of advanced technologies and international cooperation. The cooperation with BYD will not only improve the local public transportation system, but also further strengthen its international position in the clean energy sector.

It is expected that by 2025, the production line of BYD's Sumgait plant will be fully operational, producing about 200 electric buses per year. Along with this project, Azerbaijan is expected to become an emerging hub for electric vehicle manufacturing and green transportation development in Central Asia and the Caucasus.