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BYD Warns of 20% Profit Drop
Chinese electric carmaker BYD Co. warns that the cost of competing against a rapidly expanding array of rivals will slash its net profit this year by 15%-20%.
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Chinese electric carmaker BYD Co. warns that the cost of competing against a rapidly expanding array of rivals will slash its net profit this year by 15%-20%.
Last year the company’s net earnings zoomed 80% to 5 billion yuan, aided by government subsidies intended to help promote demand for EVs. The government is mandating that EVs contribute a rising percentage of overall vehicle sales in the next few years, but it also is winding down its financial aid for the sector.
BYD says its third-quarter profit plunged 24% to 1.1 billion yuan ($161 million). Sales through the first nine months of 2017 also dropped 24%, to 2.8 billion yuan ($420 million).
Overall demand for EVs and plug-in hybrid vehicles in China surged 38% to 398,000 units in January-September, according to industry data. But BYD’s share of the market declined.
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