BYD’s $233,000 sportscar targets uncharted territory
The Chinese electric vehicle manufacturer BYD is aiming to increase its market share across the board, and the $233,000 sports car it just unveiled is just one example of its high-end product offerings.
On Sunday, the U9 model, the second offering under its premium Yangwang brand, was unveiled by the world’s largest EV maker by sales. It costs 1.68 million yuan ($233,483), making it BYD’s priciest vehicle to date.
Delivery of the two-door coupe reminiscent of Lamborghini is scheduled for mid-2024, according to the Warren Buffett-backed business. During the introduction ceremony, the manufacturer showcased the U9’s independent corner lifting suspension technology and boasted about its sports car credentials, including a top speed of 309 kph and a sprint to 100 kph of 2.36 seconds.
Despite a slowdown in electric vehicle sales worldwide and price cuts by Chinese competitors in an effort to entice buyers amid macroeconomic uncertainty, BYD, which is famous for its affordable cars in China, is aiming to gain a larger share of the premium market with the launch of the U9.
With the goal of achieving a “leading position in the high-end market,” BYD announced on February 18 that it intends to showcase multiple luxury vehicles this year and beyond.”Its premium brands Yangwang, Denza and Fangchengbao “have greatly boosted the company’s profitability,” according to it.
The firm has projected for its luxury brands to contribute 20% of revenue this year, up from 12% in 2023, according to a recent research note by Nomura analysts.
The U9’s price tag is CNY1.0 million to CNY1.5 million more than what was anticipated, according to Daiwa analyst Kelvin Lau, but “you can expect higher and higher [revenue] contribution from [BYD’s] high-end brands.”
In the last quarter of 2023, BYD surpassed Tesla as the leading electric vehicle manufacturer in the world, thanks to its increasing sales, which were driven by the introduction of new models and recent price cuts. It intends to introduce new BYD models later this week, some of which may be priced lower.
Prior to the U9’s release, BYD began yet another round of its months-long pricing war by reducing the base price of its new plug-in hybrid models to CNY79,800, a decrease of CNY20,000 from earlier iterations.
Citi analyst Jeff Chung recently said that the layoffs are more of a “strategic move to grab more market share from traditional internal-combustion-engine segment” than an effort to clear stockpiles.
Because of the turmoil in China’s markets caused by fears of falling demand and inflation, BYD’s stock has not yet benefited from increasing sales.
Shares listed in Shenzhen rose 1.8% after BYD’s chairman suggested doubling the amount of the company’s share repurchase program on Sunday. The benchmark Shenzhen Composite Index rose 0.4%, but shares are still down 6.1% for the year and 30% for the past 12 months, even though that was better.
