Chinese electric car giant doubles profits

Electric vehicle maker BYD reported an 80% increase in net profit in 2023 compared to the previous year, despite increasingly fierce competition.

BYD announced on March 26 that its net profit last year reached 30 billion yuan ($4.2 billion), nearly doubling in 2022.

BYD's strong profits came despite operating in a "complex external environment," the company said, including high global inflation and slowing growth in major economies .

In the fourth quarter of 2023, BYD also surpassed Tesla in the number of electric vehicles sold globally. Accordingly, they sold more than 525,400 units, slightly more than Tesla with 484,500 vehicles.

BYD's Seal car at an exhibition in Japan in October 2023. Photo: Reuters

In 2023, BYD sold a record 3.02 million vehicles globally, up 62% from 2022. That includes 1.44 million hybrid electric vehicles, which Tesla does not produce. In terms of electric vehicles alone, the American automaker still sold more than BYD, with 1.8 million.

Compared to Tesla, BYD's cars are priced lower. This helps them attract more buyers. BYD's cheapest car sells for more than $10,000 in China. Meanwhile, the Model 3 - Tesla's cheapest car - costs $39,000.

However, fierce competition and a price war last year have hit the profit margins of many Chinese automakers, including BYD. The latest figures from the Passenger Car Association show that the country's auto industry recorded an average profit margin of 5% last year, down 1.1% and 0.7% from 2021-2022.

Still, the price war shows no signs of abating. Earlier this month, BYD cut the starting price of its cheapest model, the Seagull, by 5% to 69,800 yuan ($9,670). Other Chinese automakers have also announced price cuts in recent weeks, including Geely, Chery and XPeng Motors.

Ha Thu (according to CNN, Reuters)

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