BYD To Build Only Electric Cars, End Production Of Gasoline Cars?

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Chinese battery electric crossover: BYD e6 test drive, Los Angeles, May 2012

Chinese battery electric crossover: BYD e6 test drive, Los Angeles, May 2012

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Chinese automaker BYD, or 'Build Your Dreams', could be on the verge of abandoning convenionally-fueled car production in favor of electric vehicles.

Already known for electric vehicles like the e6 crossover, BYD is aiming for a "re-birth" plan to counter a recent slump in sales.

Reuters reports the Chinese company, which is part owned by entrepreneur Warren Buffett, could stop making gasoline vehicles within the next two years.

BYD's net profit has collapsed in recent years, from $61.1 million four years ago to only $13.1 million last year.

Recently the Chinese firm attempted to break into the U.S. market, a plan that has so far failed to materialize, despite assertions the automaker would start by delivering vehicles to the fleet market. A series of other challenges have seen BYD in the news for all the wrong reasons. Despite big plans for the e6, it has been relegated to taxi and rental car status.

One un-named BYD executive told Reuters, "The last three years have been tough, and painful at times. Everybody beat us up. A lot of long-term investors and friends of the company lost patience with us."

BYD's business interests are wide-ranging, manufacturing everything from batteries for personal electronics, through LED light bulbs, solar panels, and electric and gasoline cars and buses.

The company's solar arm could be sold on, and its increasingly uncompetitive gasoline-powered vehicles would face the chopping block. BYD is expected to unveil its Green Hybrid Technology when this week's Shanghai auto show begins on Saturday, so hybrid models are likely to get a stay of execution.

While full battery-electric cars are doing poorly in China, BYD says this is where its true experience lies, and has the technology to make it work--though such a plan is still incredibly risky in the short term.

Yale Zhang, head of Shanghai-based consulting firm Automotive Foresight, said "They either know something we don't or they're actually going to take a long time, over 5-10 years, to make this radical transition so that there's little risk."

That risk is multiplied if China's government stalls over the possibility of big incentives for electric and hybrid vehicles.

And like electric vehicle companies elsewhere are starting to realize, the real key is to build a product that people want to buy. In China, where electric car sales have not yet taken off, that might not be such an easy goal.


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Comments (7)
  1. I think BYD should make BEVs and PHEVs in both China and the US. Its gasoline cars really suck. Maybe it will be good if just leave that "dying" market ASAP.

  2. I have to agree. the EV market is booming with growing options but it seems like the PHEV market is stagnating a bit. Not sure I would base policy on US failures when they are based in what is (or will soon be) the largest car market in the world. If any place had a need for emission free driving, its China

  3. @David: The challenge is that Chinese buyers have proven to be *extremely* cost-sensitive, meaning that the higher initial purhase prices of any plug-in vehicle pose a huge disincentive.

    And at the moment, China's moneyed classes want prestigious Western brands--the usual German and British luxury makes--and have zero interest in the kind of high-tech image that makes Tesla Model Ses so popular in Silicon Valley.

    China desperately needs zero-emission vehicles for sure. (There's a different discussion to be had about their carbon footprint, because their grid is very coal-heavy, however.) But figuring out how to get people to buy them is still a tough challenge.

  4. The E6 is an amazing car, like a luxury car. Someone 6 foot tall would feel small in the back seat. As a taxi the e6 is also amazing. The recharging is very good in traffic. I took a trip to the main recharging station in the middle of the day. Even though there are hundreds of working taxis in the very large city, there were no cars being recharged and the guard was happy to see someone. The 'on the road' regen seems to be very efficient.
    Also, The BYD F0 is an amazing car. Its (the F0) small and is a very good design and goes for 700 km with a full tank of 7 gallons (28 liters). Its a fluke for china, so the sales staff don't push it, in that is is a very good quality very good efficient car. Like it is a stranger to China

  5. we didn't go there to recharge the e6 car, I just wanted to see the recharging center for the electric fleet. We still had 264 km of charge in the car so we also left without a recharge.

  6. Good call - if you can't dominate market A, be the first in market B - we should follow.

  7. WOW " incredibly risky" "They either know something we don't or . ." If the price is right - there is a market. Elon knows where it is at . . .

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