BYD Running Into "Challenges" Expanding Overseas, Likely To Miss Internal Sales Target For '24
We wrote back in January that BYD had surpassed Tesla in fully electric vehicle deliveries for the first time in history. But who knows how long that will last, because now the auto manufacturer is running into "challenges" in expanding overseas, according to the Wall Street Journal.
Despite its domestic success, BYD is grappling with issues such as low market demand, high prices, quality control challenges, and internal debates on market share acquisition strategies, the report highlights.
Specific problems have included mold in vehicles and excess stock in European warehouses, WSJ notes. As a result, the company is likely to miss its internal sales target of 400,000 international car sales this year, with only around 16,000 vehicles sold in Europe in 2023.
The company told the outlet, however, that it remains optimistic about its international prospects under Chairman Wang Chuanfu's leadership. Supported by Warren Buffett, BYD aims to emulate the global success of Japanese and South Korean auto brands.
BYD's profits doubled to about $4 billion in 2023, and it maintains a market capitalization over $70 billion. However, BYD's international journey has not been without its learning curves, similar to Asian predecessors like Hyundai, which faced recalls and quality issues in its early international expansion.
Despite avoiding widespread quality problems, BYD has seen incidents such as a bus fire in London and concerns over vehicle condition upon arrival in international markets, indicating challenges in handling long-distance logistics and maintaining quality standards.
“BYD is very satisfied with the achievements made by our overseas teams, including the one in Europe,” a company rep told the WSJ.
Recall, Tesla announced back in January it had "produced approximately 495,000 vehicles and delivered over 484,000 vehicles" for Q4 2023. The company noted that its full year vehicle delivery number was up 38% to 1.81 million, slightly less than recently revised expectations for the year. Nonetheless, total deliveries marked a record quarter for the EV manufacturer. The company manufactured approximately 1.85 million vehicles for the period.
But BYD beat Tesla's quarterly number with its battery only electric vehicle, reporting sales of 526,000 for Q4, we pointed out.
The company said it produced more than 3 million new energy vehicles for the year and it marks the second year that BYD has beat out Tesla in total production. BYD produced 1.6 million battery only vehicles, just slightly behind Tesla, and 1.4 million hybrids.
We wrote back in September 2023 that BYD and Tesla were the two companies neck and neck leading the EV industry. We noted then that for the first half of 2023, BYD alone sold almost 1.2 million plug-in electric vehicles (incl. plug-in hybrids), roughly double the combined total of BMW, Volkswagen and Mercedes.
