(BFM Stock Exchange) – Actions of Chinese car manufacturers suffered this Monday, May 26, the digesting sector of substantial price drops from byd. This recalls how intense competition is in the first automotive market in the world.

If China remains the first automotive market in the world, the competition turns out to be there.

The first player on the market in China, byd, launched a large recall bit last week. The manufacturer has saved its prices on May 23, announcing on the Chinese social network Weibo reductions in substantial tariffs, reports CNBC.

For example, the company has lowered its entry price by Seagull by 20%, an electric sedan, and 34% on the SEAL, another sedan. More broadly, the company has announced price reductions on 22 rechargeable electric and hybrid models, these discounts running until the end of June.

According to Citi Bank forecasts cited by CNBC, these price reductions may have increased traffic by 30% to 40% among BYD dealers during the weekend of May 24 and 25 compared to the previous weekend.

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The first electric manufacturer

On the Hong Kong Stock Exchange, all Chinese car manufacturers suffered, on Monday, investors fearing that Byd’s announcement is only intensifying competition and reviving the prize war.

“Although some of these discounts (announced by Byd, editor’s note) have been in place since April, the official announcement sends a signal showing how tough the market,” analysts of Morgan Stanley wrote, including Tim Hsiao, in a note cited by Bloomberg.

Geely Automobile, partner of Renault on certain markets, dropped by 9.3%, Leapmotor, who was allied with Stellantis to sell its vehicles outside of China, dropped by 8.5%, while Xpeng lost 4.4%and Li Auto 3.2%. Byd, for its part, abandoned 8.6%.

According to data from Bank of America, Byd has become the first electric car manufacturer in the world in the early 2025. Over the first three months of the year, the Chinese company had sold for just under 400,000 battery electric cars, compared to 337.68 for Tesla, second. In 2024, the American group had finished a short head ahead of Byd (1.79 million electric cars, against 1.71 million for Byd).

The manufacturer benefited from the dynamism of its domestic market, where sales of electric vehicles jumped 48% over a year in the first quarter.

The volume strategy seems to work for Byd. Over the first three months of the year, the company has doubled its net profit over one year, to just over 1 billion euros. The increase in volumes then had much more than compensated for a drop in the average selling price, noted Morningstar.

Offensive in Europe

In Europe, ByD remains an actor ultimately not very present in terms of volumes. The most recent data in the ACEA, the association of European manufacturers, last March, do not reference the group among the manufacturers that have sold the most vehicles in Europe.

However, more recent statistics compiled by the firm Jato Dyanmics and published last week have shown that the Chinese group had exceeded Tesla in Europe in April, on the only segment of electric vehicles. Byd had sold 7,231 cars for this month, translating an increase of 169% over a year, when Tesla, in great difficulty in Europe because of a lack of renewal of its range, had seen its sales plunge from 49% to 7,165 units.

Byd also seems to intensify his offensive on the old continent. Last week, the Chinese group launched the Dolphin Surf, a European version of its electric Seagull, with a price of 20,000 euros, very competitive.

This model has arguments to assert the competitors produced by European manufacturers. UBS recalls that the Seagull is currently the best -selling electric model in China, the volumes that exceeded 50,000 units in April, with a starting price of 8,500 euros in this country.

“Although the price in Europe is currently more than twice higher (to that in China, editor’s note), we believe that it is a competitive product in an expanding segment,” writes UBS.

“We believe that in this price sensitive to price segment, Byd could have the most convincing offer on the market,” continues the Swiss bank.

“However, historical competitors continue to have a better network of dealerships and after-sales and can stimulate sales thanks to attractive leasing offers proposed by their own financing companies, while BYD must rely on external leasing/financing partners which, so far, have set leasing prices in the reason for high risk.”