China’s largest EV maker, BYD, scored a record $1.42 billion in Q3 profit despite an intensifying price war. The Chinese automaker is closing in on Tesla as we approach the end of the year in pure EV sales.
BYD came within a few thousand vehicles of surpassing Tesla as the largest EV maker globally in the third quarter.
The automaker’s sales have been climbing all year, with a record 151,193 fully electric vehicles sold in September alone.
BYD’s EV sales reached 431,603 in Q3, propelling it closer to Tesla. Tesla delivered 435,059 EVs in the third quarter as it works its way toward its 1.8 million target for the year.
Tesla and BYD have cut prices drastically this year as they look to advance their dominance in the EV industry. Following another price reduction earlier this month, Tesla’s Model 3 is the cheapest it’s ever been.
The move has rippled across the industry, forcing many legacy automakers like Ford, Hyundai, Volkswagen, and others to follow.
BYD posts record Q3 profit despite EV price cuts
Despite the lower prices, BYD posted a record profit in Q3. The automaker announced Monday it scored a net profit of $1.42 billion (RMB 10.41), up 82% compared to last year.
The increase in sales led to BYD’s operating revenue rising 38% YOY to $22.2 billion (RMB 162 billion).
BYD’s gross margins also reached 22.12% in the quarter, its highest in three years. The company said in a filing earlier this month it expected record Q3 profit as it gained control over scaling and supply chain costs.
After dominating in the world’s largest EV market, BYD is already leading several overseas markets like Thailand, Brazil, and Columbia.
With new launches in Japan, Mexico, Australia, India, Hungary, and others, BYD looks to keep the momentum going into the end of the year.
Electrek’s Take
BYD has an advantage as it expands globally. Although the automaker doesn’t sell its EVs in the US (they do sell electric buses), you may own one of its products.
BYD started as a battery company and is now the largest global supplier of rechargeable batteries. The company even outsources batteries to other automakers like Tesla, Toyota, Kia, and others.
The company is nearly entirely vertically integrated, with specific divisions for every component. For example, all components on the Dolphin electric hatch are made in-house, expect the tires and windows. This is a big reason behind BYD’s Q3 profit surge.
The fourth quarter is shaping up to be an interesting one as BYD looks to close the gap with Tesla to become the top EV maker globally.