Chinese electric car maker accelerates in global race

In many markets, the best-selling clean-fuel car is not Tesla, but BYD - a Chinese car company backed by Warren Buffett.

When it comes to the popularity of electric vehicles around the world, most people will think of Tesla – the current global leader. However, the best-selling electric brand in the emerging clean-fuel vehicle markets of Brazil, Israel and Thailand is not Tesla, but BYD. The Chinese electric car maker is increasingly present on the streets from Sydney, Australia, Delhi, India to Montevideo, Uruguay.

In the first quarter of this year, the Chinese automaker surpassed Volkswagen as the top-selling car brand in China, a blow to Volkswagen’s 15-year dominance in the country. BYD accounted for 39 percent of new fuel-cell vehicle sales (electric or gasoline-electric) in China, the world’s largest car market, according to the China Passenger Car Association.

BYD is also expanding aggressively internationally. It recently entered Mexico, Spain and the UK. This month, it plans to try its luck in Italy, with a launch party in Turin, the home of Fiat. After exporting its first cars to Norway in 2021, it is now selling cars in Singapore and Sweden. These are real wins for a Chinese consumer brand.

"BYD suddenly became one of the biggest car companies in the world," said Steve Westly, former Tesla executive.

BYD's Dolphin electric car. Photo: Bloomberg — BYD's Dolphin electric car. Photo: *Bloomberg*

BYD is currently run by founder and chairman Wang Chuanfu. BYD stands for Build Your Dreams. The carmaker is also an example of Chinese President Xi Jinping's ambition to increase China's power in the world. BYD has sold products to 53 countries and regions.

Berkshire, Warren Buffett's investment company, first invested $22 million in BYD in 2008. Buffett has praised Wang Chanfu and visited the company's factory in China in 2010.

BYD is popular for its eye-catching design, many features and affordable price. Its latest electric hatchback – the Seagull – starts at just $10,400. It has a 55 kW motor, 30 kWh battery, a range of 300 km per charge and a top speed of nearly 130 km per hour.

BYD produces many of its own components, which allows it to better control costs and reduce production costs. Unlike many other electric car companies, it makes its own batteries and is now the second-largest battery maker in the world. BYD also makes its own semiconductors, which has helped it avoid the chip shortages that other automakers experienced during the pandemic.

At BYD’s headquarters on the outskirts of Shenzhen, tens of thousands of employees work in more than a dozen office buildings and factories. They commute by an elevated railway built by BYD itself. There are also employee dormitories and a museum honoring the company’s hundreds of engineers and financial achievements. One wall of the building charts BYD’s revenue, from virtually zero in 1995 to 424 billion yuan ($60 billion) in 2022.

Last year, BYD sold 1.8 million new-energy vehicles, more than double the previous four years combined. Its global workforce also doubled to 570,000, more than 200,000 more than the world’s current largest automaker, Toyota Motor. Last year also marked a turning point for BYD’s international revenue, which only started exporting vehicles in 2021.

In terms of revenue from the "home" market, 75% of BYD's revenue still comes from China. In contrast, Tesla records half of its revenue from the US. Toyota even has only 25% of its revenue from Japan.

Outside BYD's headquarters in Shenzhen. Photo: CGTN — Outside BYD's headquarters in Shenzhen. Photo: *CGTN*

BYD aims to sell 3.7 million all-electric and gasoline-electric vehicles this year, while Tesla says it could produce 2 million electric vehicles by 2023. But BYD has an advantage because Musk only produces pure electric vehicles.

BYD became the leading clean-energy vehicle maker in Brazil, Colombia, Israel and Thailand in the first quarter, surpassing BMW, Renault and fellow Chinese rivals Zhejiang Geely and Hozon New Energy Automobile. In Australia, India and New Zealand, it is now in the top five.

Michael Barnden, a retired teacher in Adelaide, Australia, switched to a 5-seat BYD Atto 3 electric car in November 2022. This is not the first time Barnden has used an electric car. Four years ago, he bought a Hyundai Ioniq hybrid car. But when he saw an advertisement for the Atto 3, with heated seats and a range of 480 km, he switched to this type.

Half a world away, BYD electric vehicles are also attracting customers like Facundo Fernandez, a taxi driver in Montevideo, Uruguay, who decided to buy a BYD because it was cheaper than Western brands.

“Gasoline is very expensive in Uruguay,” Fernandez explained. A charge of about 500 pesos ($13) will give him a range of 400 kilometers, but a full tank will cost him 2,500 to 3,000 pesos.

Fernandez said he would buy a bigger BYD next year, so passengers could sit more comfortably. “The Chinese brands compete because they have similar features at a lower price,” he said.

BYD’s global expansion has been missing one important market: the United States. Although it has sold electric buses there, BYD has no plans to enter the passenger car market. President Joe Biden’s Deflationary Act only offers tax incentives for electric vehicles made in North America. Stella Li, BYD’s North American regional director, says the company doesn’t have to enter every market. It’s just going to be present where it feels ready.

Several European and Southeast Asian governments have also shown interest in BYD. The company is in talks with officials about building a factory in France, Les Echos reported in May. Last month, BYD also confirmed to Bloomberg that it plans to produce in Vietnam for local sales and export to Southeast Asia.

The automaker is building a factory in Thailand, which would be its first outside the country. It is also considering manufacturing in the Philippines and Indonesia. In Brazil, Ford Motor is in talks to sell one of its factories in Bahia to BYD.

“What they have accomplished in such a short time is amazing,” Westly concluded.

Ha Thu (according to Bloomberg)

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