China`s biggest electric car maker BYD has agreed a $1bn (£780m) deal to set up a manufacturing plant in Turkey, as it continues to expand outside its home country.

The new plant will be able to produce up to 150,000 vehicles a year, according to Turkish state news agency Anadolu.

The facility is expected to create around 5,000 jobs and start production by the end of 2026.

The deal was signed at an event in Istanbul attended by President Recep Tayyip Erdogan and BYD`s chief executive Wang Chuanfu.

BYD did not immediately respond to a BBC request for further details on the deal.

The announcement comes as Chinese EV makers face increasing pressure in the European Union and the US.

Last week, the EU took action to protect the bloc`s motor industry by raising tariffs on Chinese EVs.

The decision saw BYD hit with an extra tariff of 17.4% on the vehicles it ships from China to the EU, which was on top of a 10% import duty.

Turkey is part of the EU’s Customs Union, which means vehicles made in the country and exported to the bloc can avoid the additional tariff.

The Turkish government has also taken action to support the country`s car makers by putting an extra 40% tariff on imports of Chinese vehicles.

Republic of Türkiye Directorate of Communications The deal was signed at an event attended by BYD`s chief executive Wang Chuanfu and President Recep Tayyip ErdoganRepublic of Türkiye Directorate of Communications

In May, US President Joe Biden ramped up tariffs on Chinese-made electric cars, solar panels, steel and other goods.

The White House said the measures, which include a 100% border tax on electric cars from China, were a response to unfair policies and intended to protect US jobs.

BYD, which is backed by veteran US investor Warren Buffett, is the world’s second-largest EV company after Elon Musk`s Tesla.

The company has been rapidly expanding its production facilities outside China.

At the end of last year, BYD announced that it would build a manufacturing plant in EU member state Hungary.

It will be the firm`s first passenger car factory in Europe and is expected to create thousands of jobs.

On Thursday, BYD opened an EV plant in Thailand - its first factory in South East Asia.

BYD said the plant will have an annual capacity of 150,000 vehicles and is projected to generate 10,000 jobs.

The company has also said it is planning to build a manufacturing plant in Mexico.

Source: BBC