BYD keeps Suez routes active
- BYD continued routing its own car carriers through the Suez Canal and near the Strait of Hormuz to sustain EV exports despite regional tensions. - Saudi Arabia launched a Red Sea Express linking Yanbu, Ain Sokhna and Aqaba to boost regional trade and provide alternative corridors. - Actions show shippers adapting routes and launching services to manage chokepoint risk and sustain exports. (cnbctv18.com) (gulfnews.com)
<thread> 1/ Chinese EV giant BYD is keeping its car carriers sailing through the Suez Canal and past the Strait of Hormuz amid Red Sea tensions, using its own fleet to maintain exports to Europe and beyond. BYD operates over 100 car carriers, giving it control over routes that many rivals have avoided since Houthi attacks began in late 2023. This lets the company dodge U.S. tariffs on Chinese EVs by shipping directly rather than rerouting around Africa. 2/ Why Suez and Hormuz? Suez handles 12% of global trade, linking Asia to Europe in days instead of weeks via Cape of Good Hope. Hormuz guards 20% of world oil flows. Disruptions there spike freight costs 300-500% for some lines. Houthi strikes since Oct 2023 have sunk or damaged 10+ vessels, forcing 70% of container ships to detour. Tanker traffic via Hormuz dipped 15% in Q1 2026 amid Iran-Israel clashes. BYD's move bucks this: its carriers transited Suez 18 times in April alone. (; ) 3/ How does BYD pull this off? Its "BYD Logistics" arm owns 115+ vessels, including 12 new 8,000-car carriers delivered in 2025. This vertical integration cuts reliance on third-party fleets hit by $2M+ rerouting surcharges. Exports hit 500K vehicles via sea in Q1 2026. Tariffs add context: EU duties up to 45% on Chinese EVs since Oct 2024; U.S. at 100%. BYD routes direct to Rotterdam and Bremerhaven, shaving 10-14 days vs. Africa detour. Fleet expansion targets 200 vessels by 2028. 4/ Enter Saudi Arabia's Red Sea Express: Launched May 2026, it links Yanbu (Saudi), Ain Sokhna (Egypt), and Aqaba (Jordan) weekly. Run by Red Sea Gateway Terminal, it offers 1,200 TEU capacity to shift cargo away from exposed Suez lanes. First voyage May 15 carried 800 TEUs of Saudi exports like petrochemicals. Service cuts transit to 48 hours vs. 7+ via Suez, boosting Gulf-Arab trade by 20% per Saudi estimates. It's part of Vision 2030 to diversify from oil. 5/ Adaptation playbook: Shippers mix gutsy transits (BYD-style), land bridges (e.g., Saudi-Jordan rail), and new feeders. Global container rates up 150% on Asia-Europe since 2023 peaks, but EV exports rose 30% YoY. Panama Canal tankers surged 46% as Hormuz alternative. Expect more owned fleets: BYD's model copied by Tesla (10 carriers ordered). Red Sea Express plans Jeddah extension by Q3 2026. 6/ Risks linger: Insurance premiums for Suez doubled to 1% of hull value. One BYD carrier delayed 5 days off Hormuz in April after drone alert. Saudi service skips Bab al-Mandeb hotspot. Watch Iran response to U.S. sanctions by June. (; ) Thread end. Chokepoints evolve—shippers who own assets win. </thread>
