BYD to take fight into JV segment

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BYD have run amok in the Chinese car industry in the past two years, seemingly coming from nowhere with their purchase of a bankrupt state owned car maker into one of the power houses of the Chinese car industry that has made Chery’s and Geely’s growth look rather meager in comparison.

BYD saw sales of over 400,000 vehicles in 2009, and is aiming to double that for 2010 with 800,000 vehicle sales and now they are attempting to enter the premium segment, which BYD has identified as being vehicles that are priced 100,000rmb ($14,646USD) and up.

According to a recent interview with BYD’s deputy general manager, Mr. Wang Jian Jun, 2010 is set to be BYD’s year for brand building year, where BYD will aim to build a global brand and will be producing some high end vehicles in which to accompany it.

Mr. Wang commented that cars priced 100,000rmb and rising are mostly cars developed by joint venture companies, but due to joint venture companies continually offering lower priced models, it is time for BYD to march into their pricing territory.

Until now, BYD’s cars have been priced from 30,000rmb to 100,000rmb, which has covered their base from mini cars to large sedans, by entering into the 100,000rmb and up price segment BYD can reach their sales goal of 800,000 cars.

BYD’s second factory in Xi’an city will be online in 2012, which will expand their production in Xi’an to 300,000 to 400,000 vehicles which will give them greater production capacity, and will no doubt serve as a production facility for them to continue into the 100,000rmb and up segment.

BYD have also set up different sales networks which target rural, sub-urban and urban with different models which makes sure that BYD models are suited to each market, and means that BYD dealers are never left with models that they cannot sell in specific markets.

The BYD F3DM plug in electric hybrid has gone on sale in Shenzhen to private buyers, and the pure electric E6 MPV is already under going road testing as a taxi in Shenzhen city, although the F3DM only sold 14 units it has already sold more than expected.

Mr. Wang believes that pricing is no longer an issue for electric car sales, especially as the government is offering subsidies of upto 50,000rmb on pure electric cars and hybrid cars to consumers, Mr. Wang believes that the biggest hurdle is now the lack of charging equipment which is putting consumers off buying something that could essentially become a large paperweight.