The Chinese Manufacturing Company of Electric Vehicles BYD faces pressures in order to restore investor confidence after a sale shares worth $ 45 billion.
At the same time, there are increasing concerns about its ability to face competition amid a devastating price war with other rival companies in China. BYD shares listed in Hong Kong have fallen more than 30% of the historic high that arrived just four months ago, are left behind by their competitors.
Analysts’ sale ratings for BYD have risen to the highest level by 2022according to data collected by Bloomberg.
Investors are losing their patience with BYD’s strategy leading the major discounts, while the government is taking strict measures against the so -called “repetition” that causes chaos in the industry. At the same time, competitors such as Geely Automobile and Zhejiang Leapmotor Technology are gaining ground.
The company reported a 30% drop in June quarter profitsthe first drop in more than three years due to the impact of the price war. Byd, China’s leading electric cars manufacturer, has been the main driver of multiple rounds of discounts in recent years as manufacturers are fighting for market share.
In the meantime, Beijing has become more and more vocal in its efforts to limit excessive competition, which it considers to create deflationary pressures and damages the international reputation of the Chinese industry. Byd is now awaiting deliver 4.6 million vehicles this yeara sharp fall from the previous target of 5.5 million.
To even achieve this reduced goal, the company must deliver about 1.7 million points in the last four months – which is difficult, given its old range of products and the new regulatory environment.