In the midst of a discount battle in the domestic market, the Chinese electric car maker BYD significantly increased its profit in the second quarter. Despite its aggressive pricing policy, group profits rose by 32.8 percent to 9.1 billion yuan (1.15 billion euros), as BYD announced on Wednesday. This is the biggest jump in profits since the end of 2023. Sales climbed by a quarter to 176.2 billion yuan from April to June.
BYD has its market share in China massively expanded and Volkswagen left far behind as the leading car manufacturer. Since then, BYD has been able to hold its own despite a raging price war. The car manufacturer relies on a strategy of vertical integration and uses key components such as batteries from its own production. Numerous foreign manufacturers such as BMW, Mercedes, Audi, Toyota or Tesla buy batteries from BYD.
High discounts create market share
With the goal of increasing annual sales by 20 percent, BYD is offering deep discounts on its bestselling Dynasty and Ocean series. In this way, the group wants to secure its pioneering role with a share of more than a third in cars with alternative drive systems (NEV) in China. In addition to purely electric cars, the segment also includes those with hybrid drives.
BYD’s home market of China is the world’s largest market for electric cars; the majority of new cars in the People’s Republic are expected to be electric by 2035. Generous subsidies have boosted sales in recent years and spawned numerous electric car manufacturers. In July, for the first time, half of all new registrations in China were purely electric or hybrid cars.
The USA, Canada and the EU accuse China of distorting competition because of unacceptable subsidies for its electric car manufacturers and have imposed high additional tariffs.
In Germany, BYD’s sales are still weak. In 2023, just 4,139 new BYDs were registered, and in the first seven months of 2024 only 1,432. The Chinese company has fallen out over this with its importer in Germany, the Hedin Group. BYD’s new European boss Stella Li (54) wants Hedin will now take over the import and design it himself in the future
. The manager magazine reported exclusively on the plans.