Byd under pressure: competition in China and risks from EU rules

For the fourth consecutive quarter Byd sold more battery electric vehicles (Bevs) than Tesla. And for the first time, the Shenzhen-based group is on track to close a full year ahead of the brand led by Elon Musk. A historic overtaking, which consolidates Byd as the world's leading manufacturer of battery-powered cars, just three and a half years after ceasing to produce vehicles with internal combustion engines (March 2022). Yet despite the supremacy, elements of uncertainty are not lacking. Since last spring, the stock has quickly lost share on the stock market - about -30% from its May highs - and in September came the first drop in deliveries since February 2024, to 396,270 vehicles, -5.5% year-on-year.

The slowdown was solely due to plug-in hybrids (Phev), which plummeted 25.6% last month in China, where sales have been declining for six consecutive months. In contrast, Bevs continued to grow (+24.3%). This would not be a problem if it were not for the fact that plug-ins remain a central component of the range, even in Europe, where the brand is accelerating, albeit with a still marginal share.

Brussels has not yet definitively closed the terms of the stop on the sale of thermal engines to 2035, while as things stand, European rules favour pure electric and do not play in favour of plug-ins. A recent report by Transport & Environment highlighted how many Phev models emit more CO2 than declared. European regulations in the run-up to 2030 are becoming more stringent and oriented towards actual emission values, penalising plug-ins (compared to Bevs) both in terms of taxation and access to incentives and fleet credits used to enable manufacturers to meet decarbonisation targets.

The state of discussions between manufacturers, suppliers and the European Commission reflects a formally flexible attitude on the part of the latter, but one that is convinced thatthe future of the car is electric, as President Ursula von der Leyen reiterated at the recent summit on 12 September. However, 'Byd too, like many Chinese and recently also European competitors, is or will be working on innovative plug-in applications, such as the Range Extended EV (Reevs, electric cars that use the internal combustion engine only as a generator to recharge the battery, guaranteeing always-electric traction and greater autonomy, ed.) Reevs could change the competitive balance in the short to medium term, both in China and Europe, regulation permitting.

Meanwhile, Byd has revised its 2025 guidance downwards, from 5 to 4.6 million vehicles. Abroad, growth is rapid: a record 3,000 registrations were achieved in Germany in September, and global exports for the month reached 71,256 units, up 120% year-on-year. In Italy, the Chinese manufacturer recorded 2,488 registrations, reaching a market share of 2%, now among the top 20 brands. But international sales are not enough to compensate for the weakness of the domestic market, where Geely, Xpeng and Leapmotor are gaining ground.