BYD profit slumps again as pressure piles up for China EV giant
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BYD is battling to remain dominant in China, where a prolonged price war is triggering government concerns that competition could damage product quality.
PHOTO: REUTERS
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- BYD's third-quarter profit fell 33% to 7.82 billion yuan, with revenue down 3%, missing estimates due to domestic competition.
- NEV sales declined 1.8% year-on-year, but overseas sales grew 160%; BYD aims for a 2026 rebound with new models.
- China's price war concerns government, BYD is investing in R&D and luxury brands, anticipating a sales boom before subsidy cuts.
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BYD reported another slump in quarterly profit as intensifying domestic competition and industry scrutiny pile pressure on the Chinese carmaker’s sales outlook.
Third-quarter profit tumbled 33 per cent from a year earlier to 7.82 billion yuan (S$1.4 billion), the company said on Oct 30. BYD saw total revenue drop 3 per cent to 194.98 billion yuan, missing estimates for 216 billion yuan.
The Shenzhen-based automaker delivered 1.15 million new energy vehicles (EVs), including pure-electric models and plug-in hybrids, in the period, down 1.8 per cent from the third quarter of 2024. Rivals Geely Automobile Holdings and Chongqing Changan Automobile reported increases in third-quarter sales of 96 per cent and 84 per cent, respectively.
The world’s largest EV maker is battling to remain dominant in its home market of China, where a prolonged price war is triggering government concerns that cut-throat competition could damage product quality.
BYD had previously slashed its 2025 sales goal by 16 per cent to 4.6 million units. In September, it lost the title as China’s best-selling automaker to state-owned SAIC Motor after the EV giant experienced its first year-on-year sales decline in 18 months, according to data released by the China Association of Automobile Manufacturers.
Analysts attributed the sales slowdown primarily to BYD’s efforts to reduce inventory ahead of its roll-out of 2026 models. The automaker’s absolute and relative inventory measures fell month over month in September, according to an earlier note published by Citigroup.
“A ‘de-stocked’ BYD could be loved by the market again with its relatively defensive margin trends and cost advantage natures than peers” if the company’s export mix significantly improves in the first quarter of 2026, analysts including Mr Jeff Chung said in the note. Overseas sales volume grew 160 per cent from a year earlier in the third quarter, fuelled by demand across Europe and Latin America.
The company is also ploughing more investment into research and development, which may contribute to future product updates and its ramp-up of high-end, high-margin models under the luxury Yangwang and Fangchengbao brands in 2026.
With Beijing calling on several industries, including the automobile sector, to end unsustainable price wars, manufacturers could struggle to maintain their sales momentum.
The government’s campaign, though, so far appears to have had only a limited effect on carmakers. Market watchers are expecting a further boom in sales across the final quarter of the year before phase-outs of some subsidies and tax incentives. BLOOMBERG
