A BYD electric vehicle on display at an international auto exposition in Haikou, Hainan province. Shi Yan / For China Daily

Chinese electric-car maker BYD Co Ltd's new commercial vehicle factory in Qingdao, Shandong province, started production on Thursday. The facility is expected to manufacture up to 5,000 electric buses annually worth 10 billion yuan ($1.5 billion).

"We will deliver more new-energy buses and our operational experience to Qingdao," said BYD Chairman and CEO Wang Chuanfu.

"Meanwhile, we will continue to increase the capacity of the manufacturing base, from 1,000 units of electric buses in the beginning, to 5,000 units eventually," Wang added.

Built at a total cost of 3 billion yuan, the plant covers 66 hectares. It will also be BYD's Shandong headquarters, export center for its electric buses and its research and development center.

On Thursday, BYD delivered the first batch of its K9 electric buses to Qingdao Jowin Group, one of the city's leading public transport operators.

K9 is a 42-seat electric bus with a battery range up to 350 kilometers. It has a 12-meter body and other features including an electric air suspension system and a smart key system.

"Shandong is the second-biggest auto market in China," said Zhang Yu, managing director of Automotive Foresight Co.

"BYD's move is very likely to seize the Shandong market, as well as the North China market," he added. The company sold about 62,000 new-energy vehicles worldwide in 2016, up 235 percent year-on-year.

Wang said BYD was among the top sellers of new-energy vehicles in 2015, accounting for 11 percent of the global market.

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