BYD reportedly has posted its weakest quarterly profit growth since 2022 while its revenue growth slowed to the lowest level in nearly four years, hit by slowing EV demand and a bruising price war in the world’s largest auto market.
First quarter net profit was up 10.6% at CNY4.57bn (US$631.08m) while revenue grew by 4% to CNY124.94bn, BYD said in a stock market filing cited by Reuters.
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The news agency said the quarterly results suggested BYD still pulled ahead of Tesla which reported its first quarterly revenue fall since 2020 when the COVID-19 pandemic hampered production and deliveries.
The biggest Chinese rival to Tesla handed back the world’s top EV seller title to the US giant in the first quarter after winning it last year, Reuters noted.
With a product range at different price points, BYD had ramped up efforts to move upmarket while doubling down on discounts to vie for cautious consumers amid a sputtering economic recovery.
Reuters noted BYD had unveiled the U7, its third ultra luxury model under the Yangwang brand at the Beijing auto show its premium brand Denza also showed its first sedan.
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By GlobalDataThe push to sell to higher end segments came alongside a protracted and intensified price war in China which has pulled in more than 40 brands and seen BYD slashing prices since February on the latest versions of its lineup by 5%-20% from earlier iterations, the report noted.
Goldman Sachs has forecast lower new energy vehicle unit profit in China this year compared with 2023 and said it was possible the industry’s profitability could turn negative if there were further price cuts.
Targeting a 20% jump in annual sales in 2024 from its record-breaking sales last year, BYD was under pressure from local EV upstarts betting big on an all-electric future, Reuters said.
In a much talked about interaction, BYD founder Wang Chuanfu and Xiaomi founder Lei Jun visited each other’s standa at the Beijing show.
Lei, having created an online sensation with the launch of the smartphone maker’s first car SU7, vowed to step up cooperation with BYD, the report said.
