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BYD reported more than 200 percent growth in first-half profit, and Tesla’s main Chinese rival shrugged off a bitter price war that has hit foreign groups and small start-ups hard in the world’s largest auto market.
Net profit rose 205 percent to 10.95 billion yuan ($1.5 billion) in the six months to the end of June, BYD said on Monday, as the Warren Buffett-backed group consolidated its strong presence in plug-in hybrid and Dominance of the battery drive market. Electric cars in China. Revenue rose 73 percent to 260.1 billion yuan.
The results, announced after China’s stock market closed on Monday, saw a 400% jump in net profit in 2022. The outcome comes even as a price war in China squeezes both small players and big auto groups. It is also the latest warning to global automakers as BYD ramps up efforts to export low-cost electric vehicles to foreign markets.
China is expected to overtake Japan this year as the largest car exporter. BYD is also one of the world’s largest producers of electric vehicle batteries and is leading a wave of Chinese exports of electric vehicles to regions such as Europe. Backed by China’s low-cost supply chain, the company, led by billionaire founder Wang Chuanfu, is expected to challenge traditional groups such as Volkswagen, which have been slower to develop in the electric vehicle sector.
In the first seven months of 2022, BYD will account for about 37 percent of China’s EV sales, with sales up 75 percent year-on-year, according to Shanghai-based consultancy Automobility. Seven of the 10 best-selling electric vehicles (including plug-in hybrids) in China are produced by BYD.
Elon Musk’s Tesla is No. 2 in China, with nearly 9 percent of the electric vehicle market, including plug-in hybrids, and year-to-date sales are up 58 percent year-to-date.
Bill Russo, founder of Automobility, pointed out that China’s electric vehicle sales are increasingly concentrated, with 10 groups accounting for 80% of the market share, and hundreds of companies vying for the remaining 20% market share.
“More and more (electric vehicle) companies are finding it difficult to compete with the likes of BYD and their vertically integrated supply chain and cost structure,” he said.
Russo added that while BYD sold 1.39 million vehicles in China this year, 1 million more than Tesla, sales fell from June to July, the first monthly decline in years.
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