BYD Predicts Minimum Q3 Profits of $765M, Annual Performance to Exceed Expections

Chinese electric vehicle maker BYD announced on October 17 that it expects net profits in the third quarter to reach between 5.505 billion and 5.905 billion yuan ($764.79 million – $820.36 million), an increase of 334%-365% from the same period last year, which saw profits of 1.27 billion yuan.

BYD expects a cumulative net profit of 9.1 billion to 9.5 billion yuan in the first three quarters this year, an annual increase of 272.48% to 288.85%. According to its current growth rate, BYD’s annual performance is expected to exceed expectations. For BYD’s net profit in 2022, research institutions have generally given a forecast of over 10 billion yuan.

The profitability of automobiles and mobile phones has improved, jointly driving the substantial increase in BYD’s net profit. The firm said in an announcement that despite facing many unfavorable factors, the new energy vehicle industry continued to accelerate its upward trend, and BYD’s sales maintained strong growth, effectively alleviating the cost pressure brought about by rising raw material prices. In the mobile phone business, BYD said that demand in the consumer electronics industry is still weak, but its profitability has improved thanks to improved cost control and product structure adjustment.

This year is of great significance for BYD. After stopping the production of fuel-based vehicles, it witnessed new energy vehicle sales surpassing Tesla.

On April 3, BYD announced that it had stopped the production of fuel-based vehicles since March. In fact, a sharp decline in the proportion of BYD’s fuel vehicle sales in the past two years has paved the way for the company’s move.

After abandoning fuel-based vehicles, BYD has spent great effort on the new energy vehicle field. During the third quarter, BYD’s total sales of new energy vehicles were 540,000 units, nearly 200,000 units more than Tesla. In 2020, Tesla’s global sales are nearly 500,000 units, while BYD’s new energy passenger vehicle sales are only 179,100 units.

In September this year, BYD sold a total of 201,300 new energy vehicles, a year-on-year increase of more than 183%. This is the first time that BYD’s monthly sales exceeded 200,000 units. This year’s cumulative sales have reached 1.1753 million vehicles, a year-on-year increase of 249.6%. In a September passenger car manufacturer sales list released by the China Passenger Car Association, BYD has become the sales leader, with a market share of 9.9%.

In September this year, BYD sold a total of 7,736 new energy passenger vehicles overseas, a significant increase of more than 50% from the previous month. A BYD spokesperson told the Securities Times that in 2022, the company added the export of automobiles to Japan, Germany, Sweden, Australia, Singapore, Malaysia and many countries and regions in Latin America. At the Paris Motor Show in France, which opened on October 17, BYD unveiled its new energy passenger vehicle product matrix in Europe, which is expected to be delivered within the continent in the fourth quarter of this year.

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BYD previously set a sales target of 1.5 million units for 2022. In the first three quarters of this year, BYD has completed 78% of the annual target. Based on this calculation, in the fourth quarter, BYD only needs to sell 110,000 units per month. According to its current growth rate, BYD is expected to sell 2 million vehicles this year, which means the average monthly sales volume in the fourth quarter needs to reach nearly 280,000 units.