Thousands of Byd cars have become obsolete for their own promises. Solution: lower prices

A drop of 8% of the shares. Although forceful, The fall in the actions of Byd It should not be too worrying for your shareholders if we take into account that it is close to its historical maximums but it is a symptom of the difficulties that the Chinese market of the car can pass in the coming months.

Byd has taken all the spotlights for being The company that is leadingat this time, the sale of plug -in vehicles but in the fall of their shares, companies such as Li Auto, Geely or Great Wall Motors that have fallen more than 4%have also accompanied.

The reason: the sales of byd.

Now with a 35% discount

The Chinese state needs its citizens to buy. It’s not something, much less new. In fact, in Xataka We already told you almost a decade that the country tries to underpin domestic trade, a way to support national growth and limit dependence on exports abroad.

That need is now sharpened with the electric car. The country has done everything possible to lead the transition to this technology and adopt a leading role in an industry that until now had resisted. That has led to lifting an absolutely brutal internal competition that will inevitably leave some companies along the way.

In fact, Some Chinese experts They point out that companies such as Nio, Xpeng or Li Auto, who are monopolizing spotlights for their performance in the electric car or automated driving capabilities, run an important risk of going bankrupt. Any of them, as I had a long time ago Reuters He is losing thousands of dollars with each car sold.

Therefore, an open pricing war would put them against the strings. A price war that in Byd is willing to play. At least to remove a stock they need to give out.

And like the State, the plug -in company bigger in China You need the local market to continue working in full performance. In the middle of its expansion to third markets, the company has to continue leading local commerce but has pierced itself.

In February the company launched the message that all its electric cars and plug -in hybrids They will ride, in the future, their “eye of God”the most advanced driving aid system they have in the market. The promise caught the industry by surprise and was a direct blow to brands like Tesla, who hope to take performance to their software. Byd, on the contrary, chooses to mount this standard in all its cars because, it is intuited, The income path expects it to be another.

Then, some analysts understood that China’s price war that two years ago caused an earthquake in the industry had returned. However, it has been now when Byd has taken the next step after a few months of relative calm: discounts of up to 34% in their cars.

Specifically has been the Byd Sealin plug -in hybrid format, which has received this juicy discount. But it is not the only car that can be bought at a much lower price. They point out in Bloomberg that up to 22 different models have received important discounts. He Byd Seagullthe cheapest electric car on the market and one of the best selling in China, can be found for 20% less and that already sold below 10,000 dollars in the local market.

The movement, they say from the economic environment, aims to revive sales in a market in deceleration but, above all, take stock from above. Since it was announced that the new automated driving system would reach any new car launch, vehicles in the dealers have become obsolete and it is difficult to give them exit.

In fact, also since Bloomberg They pointed out that even byd’s dealers in China are going through difficulties. Some of them have had to close and Data from the Chinese passenger car association They say that there are 3.5 million cars to sell and that the inventory average is 57 days per car sold, the highest figure since December 2023.

Although discounts have been active since April and, in fact, They have been noticed this May It is now when the company has announced A new wave of discounts. That need to get its cars to the street is the same as Tesla had to get the market Tesla Model and Prejuniper And it is one of the most common problems facing cars companies when they have to announce new models.

However, competition is so fierce and The industry advances so fast in China That an ad like the February can leave thousands and thousands of cars in a limbo waiting for a buyer. But, above all, it puts the rest of the industry that sees as Byd can continue to press its prices, even if only to take obsolete vehicles from above, while the rest of the companies seek a profitability that continues to resist.

Photo | Byd

In Xataka | Byd set out to win the electric car race. And then a TSMC factory went on sale