Beijing (AFP) – Chinese electric vehicle giant BYD reported surging sales on Wednesday, surpassing global rival Tesla in quarterly revenue for the first time as its push into overseas markets advances. The EV and battery giant is a leading player in recent efforts by Chinese automotive firms to expand overseas — plans that are increasingly threatened by thorny trade disputes between Beijing and the West.
BYD posted operating revenue of 201.1 billion yuan ($28.2 billion) during the third quarter, a filing at the Hong Kong Stock Exchange showed, up 24 percent from the same period last year. The Shenzhen-based firm’s quarterly revenue figure for the first time exceeded that of American EV powerhouse Tesla, which last week posted $25.2 billion in third-quarter revenue. BYD’s net profit during the period came in at 11.6 billion yuan ($1.6 billion), the filing showed, up 11.5 percent from the third quarter last year.
Tesla’s profitability outlook had come under heightened scrutiny after slashing vehicle prices over the last year or so in response to increased offerings from other companies — including BYD — in the EV industry. But Elon Musk’s firm reported last week a third-quarter profit of $2.2 billion, up 17 percent from the same period last year. BYD — which adopts the English slogan “Build Your Dreams” — is the most prominent EV manufacturer in China, the world’s largest automotive market.
The initial rapid sales growth of BYD and its industry peers in their home market was facilitated in part by generous subsidies from Beijing. However, the European Union has said that the extensive state support enjoyed by Chinese firms has led to unfair competition, with an investigation by the bloc finding that Beijing’s subsidies were undercutting local competitors. The EU announced Tuesday that it would levy extra tariffs of up to 35.3 percent on Chinese EVs, a move described by trade chief Valdis Dombrovskis as “standing up for fair market practices and for the European industrial base”.
Beijing slammed the measures on Wednesday, saying it had lodged a complaint with the World Trade Organization and vowing to “take all necessary measures to firmly protect the legitimate rights and interests of Chinese companies”. Earlier this year, the United States and Canada raised customs duties on Chinese EVs to 100 percent. China is targeting car sales to be mainly made up of electric and hybrid models by 2035. Hopes of achieving those ambitions were bolstered in July when such vehicles accounted for more than half of all domestic sales for the first time, according to the China Association of Automobile Manufacturers.
Originally specialising in the design and production of batteries, BYD diversified into the automotive industry in 2003. Its latest quarterly results come as China’s crowded EV sector is locked in a cut-throat price war that is weighing on profitability as smaller firms struggle to remain competitive. BYD said in an earnings report for the first half of this year that it had “effectively dealt with challenges brought by intensified industrial competition”. As the fight picks up in its home market, BYD has been ramping up a globalisation push, with plans to open factories in Hungary and Turkey.
© 2024 AFP
