BYD: to recover its sales by launching models based on new technologies
Su Rui sedan with remote driving control; new PHV Qin to be released in late 2012
Since its establishment in 1995, BYD has been known as a rechargeable battery manufacturer producing nickel and lithium ion batteries. It expanded its business into the automobile market with the acquisition of Xi'an Qinchuan Automobile, a Chinese compact vehicle manufacturer, in 2003. BYD is focused on researching and developing new energy vehicles, utilizing its experiences from the rechargeable battery business. It launched the world's first plug-in hybrid vehicle (PHV, It's called Dual Mode electric vehicle by BYD), the F3DM, at the end of 2008. This report will outline BYD's recent activities surrounding its automobile business.
After its rapid growth peaked in 2009, BYD's sales volume ceased its growth due to troubles with its dealers and the stalled growth experienced throughout Chinese brands (original brands established by Chinese manufacturers). The annual sales volume for 2011 was down 13.7% from the previous year to 450K units, and the sales volume for the January to June 2012 period was down 11% from the previous year to 210K units. The decline in sales was especially prominent with its major models, the F3 (including two box vehicles), F6, and F0 which used to account for nearly 90% of the sales volume (as of 2010). Its sales took a big plunge, dropping 51.1% from the previous year to 90K during the first half of 2012.
In its effort to recover its sales volume, BYD is focused on developing new technologies and the aggressive introduction of its new models to different markets. The automaker enhanced its product portfolio with the launch of its first urban SUV, the S6, in May 2011, and a middle to high-end sedan, the G6, in September. In 2012, a new grade of G6 driven by a powertrain with a 1.5-liter direct injection turbocharged engine combined with a 6-speed DCT (dual clutch transmission) was launched in May, and the world's first model equipped with remote driving control technology, the Su Rui, was launched in August. Moreover, a new PHV (plug-in hybrid vehicle), the Qin, with DM II, an improved version of F3DM's drive system, DM (Dual Mode), is scheduled to be launched later this year.
Contrary to the decline in total sales volume, its revenue continued to grow slightly for 2011 and for the first half of 2012, thanks to the sales of the S6 and G6 models, which are priced higher than the existing models. However, the mobile handset components and assembly service, one of BYD's major businesses, decreased its sales from declined sales of its major accounts, while rechargeable battery and new energy business also decreased its sales from a decline in mobile and computer market as well as from depression in Europe. BYD as a whole took a big plunge for both 2011 and the first half of 2012. The revenue for automobile business, which is currently showing slight growth, is expected to stay the same for the January to September period y/y due to the sluggish market.
In efforts to recover its worldwide sales, there are some new activities regarding new energy vehicles. In China, BYD showcased its new PHV, the Qin, at the Auto China 2012. The joint venture with Daimler showcased its first concept car under its EV brand, Denz. BYD has been producing its own developed models as a private automaker, and Denz will be its first joint-developed model with a foreign OEM. As for markets outside of China, the OEM is focused on introducing its large-size EV bus, the K9. Test demonstrations for this model are set to begin in Denmark and Finland. BYD sealed delivery deals of the K9 in markets including developed countries such as Canada, the Netherlands, and Uruguay. For now, BYD will focus on bus and rental car markets in North America.
Related Reports: Beijing Motor Show 2012 (1) (May 2012)