Facing rising shipping costs, China’s BYD is reportedly taking matters into their own hands and will be spending nearly $700 million to purchase as many as eight cargo ships to move their vehicles around the world.
The Chinese automaker hasn’t officially announced the deal, but local publication Caixin reports the order agreement will see six cargo ships being built out of a shipyard in Yantai, Shandong, with an option to increase that number to eight.
The purchase will be made through a BYD affiliate company, with each ship having a capacity of 7,700 vehicles.
The deal is reportedly worth nearly ¥5 billion, or about $684 million.
BYD has turned to having their own cargo ships in the wake of soaring cargo rates. China’s automobile exports have grown significantly over the past few years, in large part the results of Tesla making Giga Shanghai their primary vehicle export hub.
With the increasing number of exports and a limited number of cargo ships available to move them, shipping rates have also grown significantly.
BYD isn’t the first China-based automaker to buy their own cargo ships. In May SAIC Group ordered three ships each with a capacity of 7,800 vehicles. Those ships were purchased through their SAIC Anji Logistics subsidiary for about ¥5 billion ($300 million).