BYD confident of hitting three million sales despite China weakness

BYD remains confident of selling three million clean cars this year despite economic challenges and an intense price war in the world’s second-biggest economy, founder and chairman Wang Chuanfu told analysts at a briefing on Tuesday (Aug 29), according to people who were present at the event.

China’s best-selling auto brand also signalled solid profits will continue in the second half of 2023, further boosting the outlook for the company, according to the sources, who declined to be identified because the analyst meeting was private.

The Shenzhen-based market leader on Monday unveiled a 145 per cent increase in second-quarter profit to 6.8 billion yuan (S$1.3 billion), and a 67 per cent jump in revenue to 140 billion yuan after selling a record number of cars in a three-month period.

A price war started by Tesla at the start of the year has squeezed other EV manufacturers. Both Xpeng and Nio this month reported wider-than-estimated second-quarter losses. BYD, however, has resisted joining the price war, instead relying on its broad range of models and price points to attract buyers.

For BYD “the clear message is they’re not” going to cut prices, Yuqian Ding, HSBC Qianhai Securities head of China autos research, told Bloomberg Television on Wednesday. “The upgraded product mix could help them mitigate largely from the pricing side so they stay more resilient and disciplined,” she said.

The Warren Buffett-backed clean car giant has sold 1.5 million fully-electric and hybrid passenger vehicles this year through July, halfway to its annual target.

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BYD shares rose 4.4 per cent as at 11.50 am in Hong Kong, taking its gain since the earnings report to 10 per cent. BLOOMBERG