China's largest electric vehicle manufacturer, BYD, reported a decline in both revenue and net profit for the first half of the year. This marks the first time since 2020 that BYD has experienced simultaneous decreases in these metrics.
BYD announced that its revenue for the first half of the year was 344.8 billion yuan (approximately 70.69 trillion won), a decrease of 7.13% compared to the same period last year. Net profit fell to 12.325 billion yuan (25.3 trillion won), down 20.54%. The drop in net profit was more significant than the decline in revenue, attributed to reduced vehicle sales leading to lower prices.
By segment, revenue from automotive and related products decreased by 8.98% to 275.34 billion yuan. In contrast, revenue from electronics and other products increased by 0.96% to 69.45 billion yuan.
In the first half of the year, BYD's vehicle sales totaled 1,808,511 units, a decline of 15.72%. The slowdown in growth became evident starting in the third quarter of last year. In the first quarter of this year, revenue was 150.225 billion yuan, down 11.82% year-on-year, while net profit dropped by 55.38% to 4.085 billion yuan, indicating a continuation of this trend.
The poor performance of BYD is largely attributed to a downturn in the domestic market. In the first half of the year, China's passenger car sales fell by 18.9% to 8.798 million units. Sales of new energy vehicles decreased by 14.1% to 4.557 million units. During the same period, BYD's domestic sales plummeted by 39.57% to 1,016,255 units, causing it to be surpassed in domestic sales by Shanghai Automotive and Geely.
Geely has positioned its new models competitively against BYD, pricing them lower. Additionally, the electric vehicle brand Leap Motor has emerged as a strong competitor to BYD in the 100,000 to 200,000 yuan market, leveraging its own technology and high-spec, low-cost strategy. Leap Motor is expected to approach sales of 1 million units this year. Industry analysts suggest that it will be challenging for BYD to regain its previous dominant position in the domestic market in the short term.
In response, BYD is focusing on expanding its presence in overseas markets. Exports in the first half of the year approached 790,000 units, a surge of 67.9%. In July, exports of new energy vehicles reached a record high of 180,538 units. BYD has raised its export target for the year from 1.3 million to 1.5 million units. Analysts believe that if BYD achieves its export goal of 1.5 million units, it could generate a net profit of 30 billion yuan solely from its overseas operations.
* This article has been translated by AI.
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