Chinese automaker BYD is expanding overseas, by operating in more than 40 nations. It plans to sell nearly two million EVs in countries across the world, including Southeast Asia and Europe. According to a report by Nikkei Asia, Wang Chuanfu, founder and chairman of BYD said, “Our dream will come true as a result of research and development efforts over 20 years. We will change the global industrial structure for luxury cars.”
Furthermore, the report said that BYD is set to release the Yangwang U8 off-road SUV and the U9 supercar in 2023, with prices ranging between 8,00,000 ($1,16,878) and 1.5 million yuan. Because of its precarious position in the Chinese market, BYD will enter the luxury EV sector. The company’s growth has been fuelled by strong sales of low and medium-priced models ranging from 1,00,000 ($14,561) to 3,00,000 yuan ($43,683), such as the BYD Song, BYD Qin, and BYD Han, according to the report.
However, competition in this price range is heating up. Tesla resorted to steep price cuts in January, lowering the base Model 3 to 229,000 yuan ($33,344) from 265,900 yuan ($38,718). It now competes head-on with BYD in the medium-priced market, the report mentioned. In December last year, BYD Auto remained the global market leader, shipping more than 5,37,000 EV units — an increase of 197 percent (on-year), in the third quarter this year, leaving Elon Musk-run Tesla far behind globally.
EV market
“Tesla’s facing a serious problem of a very limited product mix,” said Cui Dongshu, secretary general of the China Passenger Car Association (CPCA). “Its slowness to respond to Chinese consumers’ preferences has led to a very passive positioning for Tesla to rely on few means such as price cuts to stay competitive.”
Tesla has lagged behind competitors in China in introducing new models, improving navigation systems, and adding luxe interior touches or white-glove customer service to serve the developing range of consumer preferences for EVs. Even Tesla Chief Executive Elon Musk himself has conceded that China is where his firm could face its toughest competition. Tesla did not respond to Reuters’ request for comment on its China business. Grace Tao, Tesla’s vice president in charge of external communications in China, said previously the price cuts in China reflected engineering innovation and answered Beijing’s call to encourage economic development and consumption.
China’s Association of Automobile Manufacturers expects sales of EVs and plug-in hybrids to surge by 35% in 2023 to 9 million vehicles – nearly a third of China’s total new vehicle sales. While Tesla has increased sales in China, its second-largest market, it has also lost share. From 15% in 2020, its share of the China EV market fell by a third to just 10% in 2022, according to data from the CPCA.
