“Without trade barriers, BYD will almost topple other electric car companies.”
This was a statement made by Elon Musk, CEO of the American electric car company Tesla, about the Chinese competitor BYD in January. This is an entirely different attitude from 2011, when he mocked BYD vehicles on an American broadcast, asking, “Have you seen such a car?”
When a video of Musk’s mockery resurfaced last year, he reposted it on social media platform X (formerly Twitter). He praised BYD, saying, “This video is from years ago, and BYD is currently very competitive.” On the 12th, the New York Times (NYT) also reported in-depth on BYD’s strategy, stating, “BYD used to be a laughingstock in the global automobile industry, but now no one is laughing at it. It didn’t just grow through a low-price offensive.”
BYD topped the world in the fourth quarter of last year (October-December), surpassing Tesla for the first time. This year, it is full of ambition to become the number one company in the world through bold investments.
● Design Management and Self-Produced Batteries
The NYT highlighted that BYD overcame the unique tacky Chinese design by hiring Wolfgang Eger, a former chief designer of Audi, in 2016. Eger showcased a unique front design for BYD called “dragon face.”
Last year, it unveiled luxury models like the SUV ‘Yangwang’ that reminds people of Land Rover. After Eger joined, BYD received reviews that its ‘design management’ was as good as famous Western automobile companies, shedding its low-cost image.
Another secret to its success is its battery. BYD is the only electric car company directly producing batteries, a key component of electric cars. BYD started as a small battery manufacturer when it was established in 1995 and headed into the automobile industry by undertaking a car company in 2003.
In other words, it overtook Tesla, which procures batteries from different companies, using a low-cost and highly efficient production system that manufactures everything from batteries to electric cars. BYD is the second largest company in the electric car battery sector, following China’s CATL.
In particular, BYD launched a long, thin-blade battery in March 2020. It has been highly praised as significantly superior to the existing lithium iron phosphate (LFP) battery. The “Han,” which was launched in July of the same year with the blade battery installed, is cheaper than Tesla’s equivalent product ‘Model 3’, but superior in performance in terms of driving distance, zero to 100km/h acceleration time, and charging time.
● Operating the World’s Largest Car Carrier to Expand Exports
BYD is expanding its exports to Europe and other parts of the world and not just relying on the domestic market. It is noted that the world’s largest car carrier, ‘BYD Explorer 1’, which BYD built and operated, is the key to expanding exports.
BYD held a maiden voyage ceremony for Explorer 1 on the 10th of last month. It also emphasized that it will increase the number of such car carriers to 7 within the next two years to accelerate overseas sales. There are predictions that BYD, which has secured its transportation means in a situation where global logistics costs are skyrocketing due to wars in Ukraine and the Middle East, will be able to save logistics costs and strengthen price competitiveness.
Bloomberg highly praised BYD for realizing vertical integration of the car supply chain from batteries to overseas transportation and logistics, predicting, “BYD, which has an advantage in terms of cost, will put more pressure on Tesla.”
BYD is actively recruiting research personnel in Shenzhen, Guangdong Province, China’s information technology (IT) hub. It has built a “mini city” for its employees, installing a monorail for commuting from dormitories to offices. Wang Chuanfu, the chairman of BYD, emphasized to the NYT, “Our greatest asset is our technicians.” A researcher who joined BYD 15 months ago said, “The current research workforce has tripled since I joined.”
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