Tag Archives: BYD

News

How China Subsidizes Electric Car Manufacturers?

Last month, the EU launched an investigation into the privileged position of electric cars made in China due to subsidies. This does not only apply to Chinese manufacturers, but to all electric cars produced in China that are exported to the European market. Following this case, the New York Times revealed that China subsidizes the Nio with 32,000 euros per car.

In 2020, Nio was facing bankruptcy. The Chinese government gave about one billion euros to save the company, but it was not just financial support, because with that money the government bought a 24 percent stake in the company. After that, there was another financial injection from an unnamed state banking house in the amount of 1.5 billion euros.

In addition to government support, Chinese car manufacturers have another big advantage in terms of low prices compared to manufacturers from Europe and the US, and that is the lower cost of labor. A manufacturing worker there earns about a third of what an American or European auto worker earns annually. Also, Reuters recently wrote about an unnamed employee of the Changan Automobile Factory in Che-fei, who experienced a reduction in income and left his job in July, because his salary in May and June was only four thousand yuan a month (about 512 euros), instead of 900 euros as he expected.

When it comes to other electric car manufacturers, BYD is the largest Chinese electric car manufacturer, and in the first six months of this year, it made a profit of 1.35 billion euros. Some data show that the BYD Seal could be produced 35% cheaper than the Volkswagen ID.3, which, thanks to the technology, is another advantage of the Chinese manufacturer.

Source: New York Times

News

EU is investigating all car manufacturers for Chinese subsidies

As European Commission President Ursula von der Leyen announced a few days ago, the EU launched an investigation into the privileged position of electric vehicles produced in China due to subsidies. “These can also be vehicles from other manufacturers if they have used subsidies in China,” said Executive Vice President of the European Commission for an Economy Valdis Dombrovskis.

Many electric car manufacturers have plants in China, such as Tesla, Renault, VW, etc. All of them export their cars to the European market, and during the collection of evidence, Tesla was among the companies that were found to have had additional benefits. The goal of the investigation is to determine whether and in what way China subsidized car manufacturers in order to take all necessary countermeasures and equalize the market position for everyone.

Tesla enjoyed a special position in China that other companies did not have. Thanks to the Chinese government, the American company has fully utilized its domestic operations, instead of sharing them with a local joint venture partner as is the case with VW and Audi in China. Tax breaks, loans and other forms of aid have helped make China Tesla’s second most important business market outside the US.

Many will think that China will make a countermeasure against European manufacturers. Well, the chances of that are slim. If we consider that the European electric car market is the second largest in the world, after China, it can be hardly expected that the Chinese government will play against itself.

Other car manufacturers, BMW and Renault, have no comment on the situation.

Source: Reuters

News

EU-China relations could cost carmakers $7 billion in losses

The plan of Chinese electric car manufacturers to conquer the European market seems to be threatened by the current EU-China relationship. The biggest consequences could be for BYD and ZEEKR.

Last week, European Commission President Ursula von der Leyen launched an investigation into potentially unfair state support for Chinese electric vehicle manufacturers, a move the EU labeled “bare protectionism”.

A few days ago, France was the first to announce that it was canceling subsidies on new electric cars produced in China, in order to protect domestic manufacturers. According to Bloomberg Intelligence, if the other members adopt the same decision, it could threaten the import of electric cars and small commercial vehicles in the amount of almost 7 billion dollars. The French government believes that such a decision will not complicate relations with China, and is therefore considering a new subsidy decree. Citizens with lower incomes will have a subsidy of up to 7,000 euros for the purchase of a new electric car, while for others it will be up to 5,000 euros.

Chinese companies have been present on the European market for many years. Zeekr is owned by the Chinese multinational automotive company Geely, which took over Volvo from Ford in 2010, and their network includes stakes in truck manufacturer Volvo AB to near-total control of the famous sports car manufacturer Lotus. Geely is also finalizing an agreement with Renault on the combined company Horse to develop and produce a new generation of internal combustion engines.

At the beginning of September, BYD announced that it is coming to the European market with the all-electric sedan, BYD Seal. The car was unveiled in April, and now it is finally coming to Europe at the end of the year. It will be available in two versions: Design and Excellence-AWD. Both versions will be equipped with an 82.5 kWh battery, but the Design version is powered by a single electric motor with 313 hp (230 kW) sent to the rear wheels. It also has a range of 570 kilometers. Excellence-AWD is powered by two electric motors with a total power of 530 hp (390 kW). Power is sent to all wheels in the ratio of 217 hp (160 kW) to the front wheels and 313 hp (230 kW) to the rear wheels. It is built on the BYD e-Platform 3.0 for greater efficiency, aerodynamics, power, body rigidity and space utilization. Using a 150 kW DC charger, the battery is charged from 30% to 80% in 26 minutes. It has a range of 520 km.

Source: Bloomberg Intelligence