BYD wins the highest profit growth rate among self-independent brands

Gasgoo.com (Shanghai August 24)–Released data shows GWM ranks first among all self-independent brands in terms of sales volume in the first half of 2016, while the profit performance lags it behind. One main reason comes that its main force model, SUV, are in fierce competition, and the rising sales volume fails to bring up its profit.

The profit of GWM’s self-independent brands reaches RMB 8.06b in 2015, increasing only RMB 20m with the previous year and rising 0.25%. Chana, a shining star in 2015, also faces the problem. Although its sales volume and profit all exceed GWM, its 24% profit growth rate is resulted by the 76% sales growth rate. However, the crazy growth rate is obviously unsustainable.

Compared with other self-independent brands, BYD has the highest profit growth rate, which sales volume increases 4% but profit increases 84.61% in 2015. In the first half of 2016, BYD even predicts that its profit will increase 400% with the same period of last year.

In fact, we can figure out the reason from BYD’s sales structure. On one hand, BYD lags behind other brands in traditional energy vehicle market, and its sales volume in the market decreases 8.22% from January to May this year, highest among top 10 self-independent brands. On the other hand, facing fierce competition in passenger vehicle market, BYD tries out another way of electric vehicles to make profits.

BYD Energy sells 61,700 and 46,000 units’ vehicles in 2015 and the first half of 2016, increasing 234.7% and 120% respectively. The huge profit margin between traditional vehicles and alternative energy vehicles shows the secret why BYD makes great profits.

Although BYD’s sales volume ranks bottom among the five self-independent brand giants, its profit ranks third among them. Following the current growth, we can predict that in the next four or five years, BYD will make the most money among self-independent auto companies.