Shares of BYD Co. slipped approximately 5% in response to underwhelming July production and sales figures, marking investor concerns about sustainability of its recent growth streak.
According to Reuters, BYD reported a 0.9% year-on-year decline in global vehicle production in July, ending a 16-month growth streak. Production totaled 317,892 units, while sales edged up just 0.6% to 344,296 vehicles, significantly down from 12% growth in June. Plug-in hybrid (PHEV) production and sales both dropped sharply, by 24–26% year-on-year.
Investor Sentiment Turns Negative
Market sentiment turned bearish in domestic trading, with shares dropping nearly 1% initially and then a total of around 5% overall. Retail investors expressed concern as this marked its first monthly decline in deliveries in 2025, balanced only marginally by flat year-over-year numbers
Sales Breakdown Highlights Shifting Patterns
- Total NEV sales for July were essentially flat year-on-year, rising 0.56%, while down ~10% from June.
- Passenger BEV sales reached 177,887 units, up 36.8% year-on-year, but faced a 14% month-on-month drop.
- PHEV sales declined 22.6% year-on-year to 163,143 units, continuing a multi-month slump.
- Overseas NEV sales rose 169% year-on-year to 80,737 units, though down about 10% sequentially
Model-wise, the best-sellers include the Qin family (53,907 units) and Song family (59,026 units), which saw both year-over-year and month-over-month declines. Meanwhile, the Sealion and Dolphin families saw double-digit jumps year-on-year.
What This Means for BYD
| Concern Area | Key Insight |
|---|---|
| Growth Sustainability | The first production drop since Feb 2024 indicates possible peak in domestic momentum. |
| Price War Risks | Heavy discounting in China (up to 30%) is eroding margins despite volume gains. |
| Market Competition | Chinese rivals like XPeng and Xiaomi posted record July sales, highlighting intensifying pressure. |
Looking Ahead
Despite the slowdown, BYD’s 2025 year-to-date performance remains strong, with 2.49 million NEVs sold January–July, a 27% year-on-year gain. Its overseas sales doubled, and BEV adoption is accelerating.
Analysts warn that BYD must address building inventory (reported at RMB 154 billion with ~80-day turnover), maintain margins amid price cuts, and manage the shift from PHEVs to BEVs. Its EU expansion and export strategy will be pivotal in offsetting domestic headwinds.AInvest
