BYD Profit Picture Changes, but Diversification Succeeds Beyond China and Auto

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4Q 2018 | IN-5252


Rising to Challenges 


BYD sold more than 110,000 New Energy Vehicles (NEVs) in 2017 (about 15% of total sales), generating US$5.7 billion in NEV revenues, a significant portion of total revenue and profits and an increase of nearly 13%. “Significantly reduced” Chinese subsidies impacted recent auto results as China pivots instead to a system of credits. The new subsidy program is expected to provide more support to vehicles with greater range until closure in 2020. The company is rebounding with 75,800 NEV vehicle sales this year through June, an increase of 121% year over year.

A similar story applies to the all-electric buses, which may receive local subsidies for about a third of the purchase price until 2020. However, foreign markets are growing rapidly, with U.S. public transit e-bus sales growing last year by 83% (led by California, Georgia, Indiana, and Washington), leading to the tripling of the company’s manufacturing facility in California as it seeks a 30% share of the North American market. Other notable U.S. e-bus sales include Facebook, UCLA, and Stanford Univ…

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