Warren Buffett-Backed EV Maker BYD Says First-Half Profit May Have More Than Tripled

Net first-half profit at BYD, China’s EV leader backed by Warren Buffett’s Berkshire Hathaway, may have more than tripled from a year ago amid rising sales of EVs and improved market share, the company said on Friday.

BYD estimated that first half profit totaled between 10.5 billion yuan, or $1.4 billion, and 11.7 billion yuan, representing a year-on-year gain of between 192% to 225%.

Despite intensified competition in the automobile industry, BYD “continued to maintain a sound level of profitability by leveraging on its improving brand influence, continuously expanding scale advantage and strong industrial chain-wide cost control capability, as well as the price drop of upstream raw materials,” the company said in a statement.

BYD said earlier this month sales of new energy vehicles nearly doubled in the month of June from a year earlier to 253,046 from 134,036 a year earlier, underscoring the popularity of EVs in China, the world’s largest auto market.

BYD’s shipments in the first six months of the year also nearly doubled to 1.2 million, helped by improved economic growth in the country and the end of industry disruptions from Covid-related lockdowns in Shanghai a year ago.

BYD’s HK-traded shares have slid by 10.6% in the past year amid intensifying price competition, yet its market capitalization of approximately $100 billion tops that of both GM and Ford. Smaller, SUV-focused China EV maker Li Auto, led by billionaire Li Xiang, also reported a big year on-year sales gain of 150% in June to 32,575 vehicles.

BYD’s overall business is more diversified than its rivals — it also makes handset components and photovoltaics. Among its customers are Dell, Apple, Xiaomi and Huawei. Warren Buffett’s Berkshire Hathaway owns about 6% of BYD, which ranked No. 170 on the Forbes Global 2000 ranking of the world’s top publicly traded companies earlier this year.

BYD Chairman Wang Chuanfu holds a fortune worth $19.7 billion on the Forbes Real-Time Billionaires List today. BYD director Lu Xiangyang, a cousin of Wangwho also leads investment firm Youngy Investment Holding, is worth $13.6 billion, and BYD director Xia Zuoquan, who leads investment firm Zhengyuan Capital, is worth $3.7 billion.

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@rflannerychina