Shanghai (Gasgoo)- Chinese automaker BYD and local government of Chongqing Bishan District signed an investment cooperation agreement on August 23, planning to invest RMB 10 billion in building a power battery program with an annual capacity of 20GWh, which is designed to manufacture such core products as power battery cell, module and develop other supporting industries.

Wang Chuanfu, chairman of BYD, revealed that the company has been facing the shortage in battery production capacity. BYD's annual battery capacity reached 16GWh by the end of 2017. As its planning goes, the automaker will see its battery capacity increase to 29GWh, 34GWh and 39GWh in 2018, 2019 and 2020 respectively.

As a bellwether in China's new energy vehicle (NEV) domain, BYD has took the championship by NEV annual sales for 4 years in a row. In 2017, the automaker delivered 114,000 NEVs in total. Besides, BYD's Jan-June NEV sales in 2018 amounted to 71,200 units, skyrocketing 106% year on year.

Despite the strong NEV sales performance, BYD witnessed its net profit constantly drop in recent period affected by the phase-out of NEV subsidy. Last year, the company's annual net profit declined 19.5% over the previous year. Then, BYD reported a steep year-on-year net profit drop of 83.1% in the first quarter of 2018. The automaker is expected to attain a year-on-year jump of 40% to 50% in annual revenues with its revenue performance evidently climbing in the third and fourth quarter, according to the statement given by Wang Chuanfu at BYD's 2017 general meeting of stockholders.  

BYD has long been known for its closed-loop NEV ecology and the business mode of producing and marketing power batteries by itself. However, the company is now adopting more open strategies to survive the plight of profit slump. In April, 2017, BYD announced the spin-off of its power battery business, which is expected to be completed at the end of 2018 or in early 2019, according to Shen Xi, vice general manager of BYD's lithium battery business unit. 

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