BYD shares jumps after it forecast profits more than triple in the third quarter...

BYD shares jumps after it forecast profits more than triple in the third quarter

BYD shares jumps after it forecast profits more than triple in the third quarter

Aron Chen

posted on 11 hours ago

China's largest electric vehicle maker said net profit between July and September is estimated to be between 5.5 billion yuan to 5.9 billion yuan ($764.5 million to $820 million), representing year-over-year growth of 333.6% to 365.11%

Shenzhen-based BYD expected its earning more than tripled in the third quarter despite the complex and challenging business environment.

The Warren Buffet-backed firm said net profit between July and September is estimated to be between 5.5 billion yuan to 5.9 billion yuan ($764.5 million to $820 million), representing year-over-year growth of 333.6% to 365.11%.

BYD’s Hong Kong-listed shares rose 6 percent on Tuesday after it forecast a huge jump in third quarter profit,

Rising sales is strong evidence of an exciting profit estimate. BYD sold 538,704 NEVs, which consists of pure electric and plug-in hybrid cars – in the third quarter, up 194.4 per cent from a year ago and 51.7 per cent from the previous quarter. giving the automaker a market capitalization of around $93 billion.

BYD's combined sales of pure electric and hybrid plug-in vehicles surged 250% in the first nine months to 1.2 million units. By comparison, Tesla sold just over 564,000 electric vehicles during the period, while domestic EV rivals XPeng Inc and Nio Inc - both loss-making - sold more than 98,500 and 31,600 respectively.

Unlike pure electric vehicle makers like Tesla, Nio, Xpeng, which sell cars priced above 300,000 yuan ($41,580), most of BYD models are priced between 100,000 yuan and 200,000 yuan.

Despite the challenging business environment include the rising cost of raw materials, an economic slowdown in China caused largely by the spread of the pandemic, the new energy vehicle sector continued to accelerate its upward trend.

The China Association of Automobile Manufacturers has estimated that EV sales in China will increase by about 56% this year to 5.5 million units, EVs are also expected to account for 20% of overall China vehicle sales this year, up from 13.6% in 2021. 

However, not all of Chinese electric vehicle makers managed to grow in the face of headwinds. For example, Xpeng reported wider-than-expected loss for the second quarter and weak deliveries estimate for the third quarter.

“In the third quarter of 2022, despite the challenging business environment caused by the spread of the pandemic, extreme high temperature weather, high commodity prices, the new energy vehicle industry continued to grow at tremendous speed,” BYD said in a statement.

BYD is now selling its cars in multiple overseas markets including Norway, Singapore and Brazil. The company also delivered its blade battery to Tesla’s factory in Berlin, German-made Model Y is Tesla’s first model to equip with the battery starting from September this year.