Chinese auto group BYD, backed by Warren Buffett’s Berkshire Hathaway, dethroned Elon Musk’s Tesla as the world’s biggest producer of electric vehicles by sales, indicating China’s growing dominance in the sector.
BYD, based in Shenzhen (South China), sold 641,000 vehicles in the first six months of the year, a jump of more than 300% from the same period a year ago, according to company records.
That compared with 564,000 vehicles sold by Tesla, which blamed a difficult second quarter on the supply chain and sales disruptions in China after its operations were hit by lockdowns due to the coronavirus and travel restrictions.
The rise of BYD highlights China’s strengthened position in renewable energy, boasting scale and cost advantages across much of the supply chain for electric vehicles, batteries, wind and solar power.
“The performance is impressive,” said Jeff Chung, auto analyst at Citigroup, of BYD’s sales growth.
Many BYD models are hybrid vehicles, which use a large battery in addition to a traditional motor for longer journeys, but are considered “zero-emission” vehicles under China’s trade rules.
BYD, which is partially owned by Buffett’s Berkshire Hathaway, also overtook South Korea’s LG as the world’s second-largest producer of electric vehicle batteries, behind China’s Contemporary Amperex Technology, known as CATL.
According to Seoul-based SNE Research, BYD has surpassed LG Energy in terms of monthly market share since April. This was in part because of disruptions at Tesla’s Shanghai factory after China’s most populous city was forced into a two-month lockdown to suppress a wave of omnipresent coronavirus cases.
Tesla, along with some Chinese electric vehicle makers including Li Auto, Xpeng and Nio, has been hit harder by the lockdowns than BYD, which has benefited because most of its factories are not located in the regions and cities that have suffered the most restrictions. severe.
Analysts see the rise of China’s domestic auto industry as a precursor to a tectonic shift in the global auto market, as Chinese EV manufacturers begin to focus on export markets.
Last year, China, the world’s biggest car market, exported more than 500,000 electric vehicles, more than double the previous year.
However, about a third of Chinese exports to Europe were from Chinese-owned European brands such as Volvo Cars and MG Motor, while just 2% represented Chinese brands, according to researchers at the Mercator Institute for China Studies, a group. of thinkers in Berlin. Nearly half were from Tesla, and the remaining 14% from European joint ventures in China.
However, Tu Le, managing director of consulting group Sino Auto Insights, said BYD was “firing on all cylinders” with products covering many critical segments of the electric vehicle market.
He also predicts that BYD will soon challenge foreign automakers on its own turf, especially in the US. “They’re going to make some really aggressive moves to go international,” he said.
Translated by Luiz Roberto M. Gonçalves
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