Citi provided an update on BYD's business outlook and operational strategies after meeting with company management, saying the electric vehicle maker is on track to meet its $5 million to $6 million sales target. units by 2025.
BYD management expects overseas sales to double year-on-year, contributing significantly to this ambitious goal.
BYD's inventory levels are currently slightly above one month's supply, which is a notable improvement from the 2.0 to 2.5 months of inventory recorded in late 2023 and early 2024.
This healthier inventory position suggests improved operational efficiency and better preparation to meet market demand.
Despite the growing number of competitors launching new models of new energy vehicles (NEV) to compete with BYD, the company's management remains confident in its ability to increase sales volumes by capturing market share from traditional vehicles to internal combustion engine (ICE).
Additionally, BYD plans to focus more on premium brands and products by 2025.
In terms of production capacity, BYD management reports that the current monthly vehicle production capacity is approximately 540,000 units, which is equivalent to an annual capacity of 6.5 million units at peak production.
Regarding battery production, annual capacity was around 300 gigawatt hours (GWh) at the start of 2024, capable of supporting the production of 7.5 million vehicles, assuming an average battery size of 40 kilowatt hours (kWh) per vehicle.
Regarding overseas production, BYD started operations at its factory in Thailand in July 2024, with monthly production expected to reach 4,000 units by November 2024. This factory is designed to have an annual capacity of 150,000 units.
The company also plans to expand its international manufacturing presence with a factory in Brazil, which is expected to begin production in the third quarter of 2025 with a capacity of 150,000 units per year.
Additionally, a factory in Hungary is expected to start production in 2026 with an annual capacity ranging from 150,000 to 300,000 units.
BYD also offered cash rebates on select models in December 2024, as observed in industry checks. This move is seen as a strategy to maintain market share without officially announcing a reduction in the Manufacturer's Suggested Retail Price (MSRP).
In the area of advanced driver assistance systems (ADAS), BYD management intends to keep the cost of ADAS hardware at 10% of the car price, which will make these features more affordable for customers .
For its entry-level brands, BYD plans to equip vehicles with an in-house developed ADAS solution, ensuring that safety and technology features are accessible across its entire product range.
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