BYD Co, China’s leading automaker, is positioning itself to have nearly half of its future sales coming from international markets. This strategy highlights the company’s intent to establish global production hubs to bypass steep tariffs on Chinese-made vehicles. Stella Li, BYD’s executive vice president, shared these insights during an interview at the company’s Shenzhen headquarters, signaling a major shift in the company’s global market approach.
BYD’s overseas sales are expected to reach around 500,000 units this year, already having sold 270,000 in the first seven months, which makes up approximately 14% of the company’s total sales. While BYD aims to sell about 3.6 million electric and plug-in hybrid cars in 2024, mainly in China, the company is also investing heavily in international expansion. This includes new production facilities in Europe, Asia, and South America to mitigate the impact of trade restrictions and tariffs, such as the 17% duty recently imposed by the European Union and 100% levies enforced by Canada and the United States.
The company’s international manufacturing footprint includes an operational factory in Thailand, with additional facilities under development in Hungary, Brazil, and Türkiye. BYD has committed to building a plant in Indonesia and is nearing a production agreement in Mexico. To bolster its brand’s presence outside China, BYD has partnered with Uber Technologies Inc. to supply 100,000 electric vehicles for its platform and has sponsored major sports events like Euro 2024 and Copa America.
Despite the aggressive expansion plans, industry analysts like Joanna Chen from Bloomberg Intelligence believe that BYD’s goal of achieving a 50% sales share from overseas markets is unlikely before the end of the decade. While Chinese automaker Chery Auto already achieves a 50-50 sales split between domestic and export markets, other manufacturers, including BYD, still rely heavily on sales within China. BYD’s strong domestic performance was highlighted last year when it sold three million units, surpassing Western automakers like Volkswagen AG.
As part of its global strategy, BYD is also focusing on data security by establishing local data centers in Europe. This move aims to address concerns over data privacy and mirrors similar efforts by other Chinese electric vehicle makers, such as Xpeng Inc., which is developing data centers to support its smart-driving cars.
BYD’s efforts to expand its international presence and the anticipated impact on its financial performance will likely feature prominently in its upcoming first-half financial report, expected to show increased net income.
Featured Image courtesy of BNN Bloomberg
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