China’s land ministry has fined automaker BYD Co (比亞迪), a company backed by billionaire investor Warren Buffett, and seized buildings and equipment from a construction site where it was building a new factory in northern China.
The Land and Resources Ministry said yesterday that BYD was ordered to pay 2.95 million yuan (US$442,000) and forfeit the facility because most of the land for the project, in Shaanxi Province, was zoned for farm use.
Though details are unclear, the dispute reflects the intense competition for land use in this country, which is struggling to maintain grain output amid rapid and often laxly controlled industrialization.
BYD was planning a factory with a capacity of 200,000 vehicles a year, near Xian, after local officials agreed to let it build on the 29 hectare site. It began construction late last year and has erected seven dormitories, workshops and other buildings, the ministry said in a notice on its Web site.
The notice also said a number of local officials were penalized, though it did not say how, for having violated land use rules by agreeing to the deal with BYD.
BYD, whose headquarters and main factory is in Shenzhen, said it does not expect any adverse impact from the setback. The project’s future remains unclear.
“We will obey the penalty, but it won’t affect our normal operations,” BYD spokesman Paul Lin (林密) said.
The decision marks the latest setback for the Hong Kong-listed battery and electric vehicle maker, which has been hit by declining domestic sales.
ADDITIONAL REPORTING BY AFP
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