BYD earned 9.3 billion yuan in the first three quarters of this year, and Tesla’s net profit is nearly 7 times that of BYD

The vast majority of new energy independent brands have not yet stepped out of the swamp of losses. BYD (002594.SZ), which is a step ahead in the field of electric vehicles, is an exception.

On October 28, BYD’s third quarterly report showed that the company’s revenue in the first three quarters of this year was 267.69 billion yuan, an increase of 84.4% year-on-year; 5.72 billion yuan, a year-on-year increase of 350.3%, setting a new high in a single quarter.

BYD’s performance has grown significantly, mainly due to the pull of the automotive sector. In the first three quarters of this year, the cumulative sales of BYD’s new energy vehicles exceeded 1.18 million, a year-on-year increase of 249.56%, of which the sales in September exceeded 200,000 for the first time.

From the launch of the first electric vehicle in 2008 to May 2021, BYD’s new energy vehicle sales have only exceeded 1 million in 13 years. BYD, which has entered the product explosion period and the sales channel, is expected to complete the annual target of 1.5 million units ahead of schedule according to the current monthly production and sales progress. In this regard, institutions generally gave forecasts that exceeded expectations. Among them, Sinolink Securities predicts that BYD will sell 1.82 million vehicles this year, with a net profit of 12 billion yuan. Huachuang Securities predicts that BYD’s annual sales this year is expected to reach 1.85 million vehicles.

BYD’s new energy vehicle sales continued to increase, and the cost of a single vehicle was optimized under the scale effect, and the overall profit and profit per vehicle increased significantly. In addition, after BYD’s new energy vehicle prices increased twice in the first quarter of this year, due to the long delivery cycle of new vehicles, orders after the price increase were delivered on a large scale in the third quarter, driving up the profit per vehicle in the third quarter.

In addition to the scale effect, BYD’s profit has grown significantly. In addition to the scale effect, it is also related to the rapid growth in sales of high-end models such as BYD’s sedan Han and SUV Tang. Among them, the average transaction price of Han family bicycles exceeds 250,000 yuan. In addition, BYD accelerated the layout of the overseas new energy vehicle market this year, and the rapid growth of overseas sales and the premium also drove BYD’s profit growth. Among them, in July this year, BYD officially entered the Japanese passenger car market with three models including Yuan PLUS, Dolphin and Seal, and held an online press conference in September this year to launch Yuan PLUS, Han and Tang in the European market. The price of Tang has reached 72,000 euros, and the price of Tang in Germany is even twice as high as that in China.

BYD sold a total of 7,736 new energy passenger vehicles overseas in September, up 50% month-on-month. A BYD insider in charge of international market business recently said in an interview with China Business News and other media that the premium price of BYD passenger cars overseas is related to BYD’s new energy buses taking the lead overseas. The overseas price of BYD buses is often 700,000 yuan. ~$800,000, which lays a solid foundation for BYD-branded passenger cars to command a premium overseas. In addition, the overseas prices of self-owned brand new energy vehicles are generally higher than domestic ones. In addition to tariffs and other reasons, it is also related to the obvious improvement in China’s new energy vehicle technology and industrial chain capabilities. China’s new energy passenger vehicles are recognized by overseas consumers in terms of performance and other aspects, and it took BYD only two or three months to complete the annual sales target in Japan.

The competition between BYD and Tesla on a global scale has escalated, and it has become the first company in the world with annual sales of new energy vehicles exceeding one million units ahead of Tesla. In the first three quarters of this year, Tesla delivered 909,000 vehicles worldwide. Tesla, which was taken away by BYD as the global electric vehicle sales champion, recently raised its price butcher knife and lowered its price in China due to the pressure on sales. Among them, the starting price of Model 3 dropped to 265,900 yuan, the starting price of Model Y dropped to 288,900 yuan, and returned to below 300,000 yuan, and the Model Y long-life version dropped by 37,000 yuan. highest version.

It is worth noting that although Tesla lags behind BYD in sales, its profits are much higher than BYD. Tesla’s cumulative revenue in the first three quarters of 2022 reached US$57.14 billion (approximately RMB 414.66 billion at today’s exchange rate), a year-on-year increase of 58.3%; its net profit in the first three quarters reached US$8.87 billion (approximately RMB About 64.37 billion yuan), a year-on-year increase of 177.3%, of which the third quarter net profit was 3.292 billion US dollars (about 23.88 billion yuan). BYD’s net profit is a lot worse than Tesla’s, which is inseparable from the price of bicycles on both sides. At present, the price of BYD bicycles has increased to about 180,000 yuan, but the price of Tesla bicycles is close to 300,000 yuan. In this round of Tesla’s price cuts, the industry believes that the most affected will be BYD’s Han, Tang and other electric models in the price range of 200,000 to 300,000.

In order to increase profit margins, BYD is making efforts in the high-end market, and plans to launch a new high-end brand in the fourth quarter, with the starting price of the first car exceeding one million yuan. Tesla is also making comprehensive efforts to improve its competitiveness. It is building its own factory. The first Model Y equipped with 4680 batteries was rolled off the Berlin factory in July, and it wants to compete with BYD in terms of self-made batteries. In addition, Tesla is a global leader in autonomous driving technology, and its FSD (Fully Self-Driving) beta software Beta has been updated to version 10.69.2. Currently, FSD has 160,000 users in North America, and Tesla plans to bring FSD to the world in November this year. And BYD is inferior to Tesla in self-driving technology. As the current new energy vehicle track gradually shifts from electrification to intelligence in the second half, BYD urgently needs to make up for this shortcoming.

At present, although BYD is in an upward channel in sales, it has not performed well in the capital market recently. Today, BYD’s closing price was 239.89 yuan, a sharp drop of 5.93%.