BYD believes that China’s new energy automobile industry has started a knockout competition, and automobile companies must put speed first.
On the evening of March 30, an investor relations activity record sheet disclosed by BYD Co., Ltd. (BYD, 002594.SZ, 01211.HK) showed that BYD said in an investor survey on March 29 that in 2022 new energy The auto market is in short supply, but in 2023, the situation of insufficient production capacity and shortage of materials has been greatly improved, and it will enter the knockout round.
According to BYD, from January to February this year, the total market volume decreased year-on-year, but new energy vehicles increased year-on-year, and the company contributed the main increase, and its market share further increased. The production and sales bulletin shows that in the first two months of this year, BYD Auto sold 345,000 vehicles, a year-on-year increase of 90.13%.
BYD emphasized, “From the perspective of follow-up development, in the price range of 100,000 to 200,000 yuan, although the company has pricing power, the company also hopes to develop more steadily.”
Regarding the current market structure, BYD believes that in the current market environment, what is most needed is “fast”, and “fast fish eat slow fish” is more appropriate than “big fish eat small fish”, so auto companies must be fast First. In addition, hesitation and ambiguity are taboos in order to have a truly core technology and an accurate strategic direction.
On March 23, Nvidia announced at GTC2023 that it has reached a cooperation with BYD to use the Nvidia DRIVE Orin high-performance computing platform in various models of the next-generation Dynasty series and Ocean series. Regarding the cooperation with Nvidia, BYD stated that it previously cooperated with Nvidia in the game graphics card business, and now it will also cooperate with its business in the server and intelligent driving fields. At present, it is mainly foundry, which accounts for a small proportion of the entire business, but the value of follow-up business is relatively high, and the proportion of these businesses will increase in the future.
Since the beginning of this year, BYD’s overseas business has increased significantly. The sales bulletin shows that in January and February of this year, BYD exported about 10,000 and 15,000 passenger vehicles respectively, and a total of over 25,000 vehicles were exported in two months. Regarding the overseas business strategy, BYD said that from the experience of exporting to Thailand, China has crossed the threshold from 0 to 1. Now overseas consumers already know that electric vehicles are mature and advanced, and do not worry about technology and quality. The company also has Confidence to replicate the experience in Thailand.
On March 29, Reuters reported that BYD Chairman Wang Chuanfu said at the performance briefing that BYD Auto sales are expected to grow by 80% year-on-year in the first quarter. The previous sales bulletin showed that BYD sold 286,000 vehicles in the first quarter of last year. Based on this calculation, its sales in the first quarter of this year will be 514,800 vehicles.
According to Reuters, Wang Chuanfu also pointed out that the recent price war in China’s auto market is caused by the imbalance between supply and demand, which will eliminate a large number of weak enterprises.
The 2022 annual report disclosed by BYD on the evening of March 28 shows that its operating income in 2022 will be 424.061 billion yuan, a year-on-year increase of 96.2%; its net profit will be 16.622 billion yuan, a year-on-year increase of 445.86%; 149.88%; the gross profit margin of the automobile business was 20.39%, an increase of 3.69 percentage points year-on-year.
As of the close on the 30th, BYD A shares rose 3.84% to 257.2 yuan per share; Hong Kong stocks rose 3.3% to 225.2 Hong Kong dollars per share.
The author of this article, Wu Yuli, comes from The Paper. The original title: “BYD: It has pricing power in the range of 100,000 to 200,000 yuan, and the new energy vehicle industry has entered the knockout round.”