BYD August sales down 6% over July – is the dream running dry?
Reuters are today reporting that BYD’s August sales are down yet again which shows that BYD’s plans to roll out different varying models of the popular BYD F3 are not going to plan, also BYD’s different sales network maybe confusing potential consumers.
Reuters:
Chinese car and battery maker BYD Co Ltd (1211.HK), backed by Warren Buffett, said its August vehicle sales fell 5.9 percent from July on keen competition amid slowing growth in the world’s largest auto market.
BYD, which is 10 percent owned by Buffett’s Berkshire Hathaway Inc (BRKa.N), sold 31,069 vehicles in August, down 19 percent from the same month last year, the company said in an email to Reuters on Tuesday.
The homegrown automaker underperformed rivals as overall car sales in China rose 59 percent in August on year. [ID:nTOE681040]
“Overall car sales in China were weak in July and August, and some automakers cut prices,” said Paul Lin, a spokesman at BYD Auto, the car manufacturing unit of the group.
Vehicle sales for the first eight months of 2010 rose 43.4 percent to 353,129 units, representing about 59 percent of BYD’s revised sales target of 600,000 for the whole of 2010.
“We will watch for September and October, which are traditionally golden months for auto sales,” Lin said.
In late August, BYD launched two new models, the M6 and L3, which could help boost sales for the rest of the year, the spokesman said.
“We plan to launch the S6 by the end of the year,” he added.
Shares of BYD ended the morning session down 2.4 percent at HK$48.05, under performing the Hang Seng Index’s .HSI marginal gain.
China’s auto sales are returning to a more normal pace from the breakneck growth levels last year and the beginning of 2010, when government’s stimulus measures boosted sales.
BYD cut its 2010 sales target by 25 percent in July and its stock has lost about 30 percent so far this year on concern that high inventories with dealers could continue to pressure sales. (Reporting by Alison Leung; Editing by Chris Lewis)
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BYD cannot grow until it controls a significant chunk of China’s high-priced high margin market segment.
Toyota and Hyundai grew to become world class companies because they controlled local luxury car market, which generated a profit of $10,000 or more per car sold, and this profit fueled Toyota and Hyundai’s expansion.
SAIC can grow because of its profits from VW and Buick sales. BYD doesn’t have the luxury of high profit margin from high-priced luxury models and its future growth are stalled accordingly. This is a problem also shared by Chery. Geely might escape this fate depending on how well they use Volvo brand to tap into a high-margin luxury market.
IHC
Let me help you to complete the lines.
1. Chinese are sub-human race, cheap, dirty, uncivilized.
2. China has media censorship and no freedom in speech.
3. Chinese officials are badly corrupted.
4. Chinese products are full of toxic materials.
5. Chinese auto makers churn out unsafe and unreliable cars.
6. Chinese auto executives are short-sighted for quick money.
7. Chinese will not pay high price for quality cars.
8. Chinese steal IP from Korea, Japan, EU & America.
9. Korea will follow Japan conquering the US market.
….. will update !!!
Ah I remember one more.
US lawers will be waiting at the ports to confiscate any car from China.
IHC
I heard your Hyundai Equus will be launched in the US for over $500,000. I just wonder why an exclusive dealership is not setup for this premium brand but hiding under the generic name.
The real story is to raise the image of Hyundai. Genesis & Equus are by no means to head on with Lexus, Infiniti, Audi, BMW, Mercedes…they are just smoking guns. Azera, Sonata, Elantra are the real bullets to kill Camry, Accord, Corolla, Civic…
Am I correct?
@IHC
Why don’t you just say “Chinese companies cannot and will never succeed because they are just piles of crap churning out shit that nobody wants”.
That would make your job a lot easier instead of trying to find every little bit of detail you can use to bash and release your hatred towards Chinese companies.
You’ve never been to China- you never know how fast technology they develop these days… your country will rum after China soon or later, if you still keep criticising…and doing nothing- you too will loose your money because you keep paying your goods to much..