Shenzhen-based automotive firm BYD held a conference call with investors on August 30 following the publication of its semi-annual report, offering various updates on vehicle delivery time, the launch of its fifth-generation DM-i technology in 2024, and the firm’s approach to next year’s falling subsidies.
Regarding production and sales, BYD said that the company currently has 700,000 vehicle orders in hand. Officials claimed it now takes four to five months to deliver new BYD cars, indicating that production capacity still can’t catch up with new orders every month. In August, because of China’s regional power grid challenges and the effects of tight pandemic control measures, the number of deliveries was adversely affected, but figures are still expected to increase compared to July. The new Seal model has just been launched and put into mass production, and delivery pressure is very high due to the pandemic and power restrictions. At present, more than 1,000 units have been delivered, and BYD says it will improve significantly after two months of climbing.
In view of the broader industry, BYD predicts that next year, China’s entire new energy market sales will reach 9-10 million units. In 2023, new energy subsidies will fall, and BYD’s annual raw material procurement cost will be reduced by 3-5% because of the growth of sales scale. It is estimated that a 5% reduction in next year’s subsidies can be offset. The depreciation and amortization cost of a single vehicle will fall after production capacity is unleashed, and monthly profit margins will gradually increase, the firm claimed.
In terms of external battery supply, BYD’s main production capacity will be supplied internally in 2023, and a smaller proportion will be supplied externally. The proportion of external supply will further increase in 2024, said the company.
In terms of technology, BYD plans to launch high-end brands and models in 2023. It is expected to reach a selling price of one million yuan ($144,779). High-end intelligent assisted driving will be launched in 2023, and the fifth-generation DM-i technology will be launched in 2024.
In terms of international market development, BYD will regard Europe as one of its main overseas markets, and Chinese brands in Southeast Asia will also have an advantage.