BYD’s First-Quarter Profit Surges Amidst EV Price Competition

BEIJING: China’s electric vehicle (EV) giant, BYD, witnessed a remarkable surge in its first-quarter profit, jumping by 100.4% compared to the previous year. This substantial growth marks the company’s most rapid expansion in nearly two years. The increase comes as BYD solidifies its leading position in the intensely competitive domestic market, fueled by its strategic launch of a smart EV price war.

Net profit reached 9.2 billion yuan ($1.26 billion), according to a stock filing released on Friday. This figure aligns with the company’s earlier projections, which estimated profits between 8.5 billion yuan and 10 billion yuan.

During the quarter, revenue totaled 170.4 billion yuan, reflecting a year-on-year increase of 36.4%. While substantial, this growth rate is slightly lower than the 52.7% rise recorded in the preceding quarter.

Over the past few months, China’s foremost EV manufacturer has significantly disrupted the market by including its advanced “God’s Eye” driver-assistance system as a standard, complimentary feature across its entire range of vehicles. Furthermore, BYD unveiled an innovative super-charging EV technology platform.

This intensified competition from BYD has spurred rival automakers, including Leapmotor, Geely, and Toyota, to respond by introducing their own affordable EVs equipped with intelligent features.

By spearheading a renewed price war within the world’s largest automotive market, BYD aims to further strengthen its dominance in its home territory. The company’s market share in China rose to 13.6% during January-March, up from 12.1% in the corresponding period of the previous year.

In contrast, Volkswagen’s two joint ventures in China experienced a decline in their combined market share, falling to 12.1% in the first quarter from 13.7% a year earlier.

At the recent Shanghai auto show, BYD and other automakers shifted their focus away from boasting about sophisticated driving assistance capabilities. Instead, they emphasized safety features.

Enthusiasm surrounding intelligent driving has been tempered by government scrutiny of marketing claims employing terms like “smart” or “autonomous” to describe the technology, following a fatal accident involving a Xiaomi SU7 in late March.

Beyond its domestic market, which accounts for approximately 90% of BYD’s overall sales, the company has set an ambitious export target of 800,000 vehicles for the current year.

Furthermore, BYD is undertaking a comprehensive overhaul of its European operations to address earlier strategic missteps.