Ranked first in the world with 520,000 units sold in the fourth quarter of last year
Government support – self-procurement of batteries ‘strength’
“Possibility to become ‘No. 1 in electric vehicles’ in name and reality”
The U.S. reduces tax credits for electric vehicles
China’s ‘electric vehicle rise’ is scary. BYD, a Chinese electric vehicle company, surpassed Tesla of the United States, which had been the undisputed number one in the world, in terms of sales in the fourth quarter of last year (October to December). There is an analysis that if this trend is maintained, BYD is likely to soon surpass Tesla and become the world’s No. 1 electric vehicle company in terms of annual sales volume, revenue, and operating profit.
Tesla ‘Model 3’BYD focused on the Chinese domestic market in the past, but has recently been conducting aggressive marketing overseas, including in Europe. It has expanded into Germany, a traditional automobile powerhouse, as well as Sweden and Norway. It also recently announced plans to build an electric vehicle assembly plant in Hungary, Eastern Europe. The goal is to occupy 10% of the European electric vehicle market by 2030.
BYD announced on the 2nd that it sold 526,409 pure electric vehicles (BEV) in the fourth quarter of last year. Tesla has not yet disclosed sales figures for the same period, but it is estimated to have sold about 483,200 units according to Bloomberg. In three months, it sold 43,000 more units than Tesla.
In particular, the aggressive promotion policy led to the sale of 340,178 units in December, the last month of last year, which was instrumental in the change in ranking. This is a 45% increase compared to the same month last year and is the highest monthly sales volume ever. In the third quarter of last year (July to September), BYD sold about 432,000 units and Tesla sold about 435,000 units, narrowly taking first place.
The British Financial Times (FT) analyzed that “BYD’s pure electric vehicle sales surpassed Tesla’s on a quarterly basis for the first time,” and that “a tectonic shift in the (rankings) of the electric vehicle industry is an unavoidable trend.”
BYD’s combined sales of pure electric vehicles and hybrid electric vehicles also maintained more than 300,000 units per month throughout the three months of the fourth quarter of last year. Accordingly, BYD’s annual sales volume last year was calculated to be 3,024,417 units. This is equivalent to the cumulative sales volume over the past five years.
The Chinese authorities’ will to foster the electric vehicle industry and large-scale financial support are giving wings to BYD’s growth. When Tesla began offering price discounts early last year, Chinese companies led the increase in demand by offering higher discount rates. The authorities are also supporting domestic companies by providing various benefits to electric vehicles instead of internal combustion engine vehicles led by Western automobile companies.
The fact that BYD started out as a small battery manufacturer when it was founded in 1995 is also strengthening its competitiveness. It entered the automobile industry by acquiring an existing automobile company in 2003 and is rapidly growing its business based on its competitiveness in the battery sector.
Chinese electric vehicle companies, including BYD, are encroaching on the global market one after another based on the world’s largest domestic market. According to the China Automobile Manufacturers Association, Chinese companies are estimated to have sold about 9.4 million units last year, including electric vehicles and hybrids. This is an increase of about 1.5 times from 6.9 million units a year ago. Sales volume this year is also expected to be at least 11.5 million units.
According to the U.S. Treasury on the 1st, as the component requirements for installed batteries have been strengthened this year, the number of electric vehicle models eligible for tax credits of up to $7,500 (approximately 9.8 million won) in the United States is 19, a significant decrease from 43 types last year. In the case of Hyundai Motor Company, the ‘Genesis GV70’ electrified model has already been excluded from payment as requirements were strengthened once in April last year.
Beijing =
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.