Latest news with #Made-in-China
Business Times
9 hours ago
- Automotive
- Business Times
China warns BYD, rivals to self-regulate as price war heats up
[BEIJING] Chinese officials summoned the heads of major electric vehicle makers, including BYD, to Beijing earlier this week to address concerns about the long-running price war, according to people familiar with the matter. The meeting was hosted by the Ministry of Industry and Information Technology, the market regulator and the top economic planning agency, said the people, who asked not to be identified discussing private information. The gathering was attended by senior executives from more than a dozen manufacturers that also included Zhejiang Geely Holding Group and Xiaomi, the people said. Officials told EV makers to 'self-regulate,' and that they should not sell cars below cost or offer unreasonable price cuts. They also addressed issues such as 'zero-mileage' cars and mounting bills owed to suppliers that are squeezing cash flow along the supply chain and acting as quasi-debt financing for automakers, the people said. It is rare for China's market, industry, and economic regulators to jointly host a meeting with the car industry on operational matters like pricing. The move shows how much scrutiny the nation's top leadership is paying to the sector, amid concerns the price war is becoming unsustainable and could send weaker companies into bankruptcy. However, the gathering did not result in a mandatory directive and it's not clear what consequences manufacturers would face if they don't follow the verbal warnings, the people said. BYD and Xiaomi did not respond to requests for comments. A representative from Geely referred to a recent speech by chairman Li Shufu who said the company resolutely rejects price wars and will compete on technology and its values. The Ministry of Industry and Information Technology, the State Administration for Market Regulation and the National Development & Reform Commission did not reply to faxed questions. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The warnings come after BYD kicked off the latest round in the price war late last month with discounts of as much as 34 per cent, leading to criticism from industry bodies and state media. Without naming BYD, the China Automobile Manufacturers Association released a statement saying the move by a certain company started a new round of 'price war panic' that was plunging the sector into a 'vicious cycle' and threatening supply chain security. 'Disorderly price wars intensify vicious competition, further compressing corporate profit margins,' the association said. Media outlets directly controlled by the Communist Party leadership including Xinhua, the People's Daily and state broadcaster CCTV have all published reports in recent days that called for automakers to stop discounting and restore order to the industry. Otherwise, this could lead to low-priced and low-quality products that will damage the international reputation and the image of 'Made-in-China,' the People's Daily said. This week's meeting marked the second time in recent days that industry leaders have been rebuked over 'zero-mileage' cars – a practice in which automakers that have failed to meet their sales targets offload new vehicles to supply chain financing companies or used car dealers. These essentially new cars then appear on the resale market with no mileage, while manufacturers record them as sales despite them not having reaching the end-consumer. The Ministry of Commerce also met with at least two major carmakers and online used cars platforms last week on the issue. Carmakers have been trying to pass on the hit from the price war to suppliers, demanding lower prices for parts and delaying bill payment by months. A price cut demand by BYD to one of its suppliers late last year attracted media coverage and scrutiny of how the EV behemoth may be using supply chain financing to mask its ballooning debt. A report by accounting consultancy GMT Research puts BYD's true net debt at closer to 323 billion yuan (S$57.8 billion), compared with the 27.7 billion yuan officially on its books as of the end of June 2024, through delaying its payments to suppliers and other related financing. BLOOMBERG
Mint
9 hours ago
- Automotive
- Mint
China Warns BYD, Rivals to Self-Regulate as Price War Heats Up
Chinese officials summoned the heads of major electric vehicle makers, including BYD Co., to Beijing earlier this week to address concerns about the long-running price war, according to people familiar with the matter. The meeting was hosted by the Ministry of Industry and Information Technology, the market regulator and the top economic planning agency, said the people, who asked not to be identified discussing private information. The gathering was attended by senior executives from more than a dozen manufacturers that also included Zhejiang Geely Holding Group Co. and Xiaomi Corp., the people said. Officials told EV makers to 'self-regulate,' and that they shouldn't sell cars below cost or offer unreasonable price cuts. They also addressed issues such as 'zero-mileage' cars and mounting bills owed to suppliers that are squeezing cash flow along the supply chain and acting as quasi-debt financing for automakers, the people said. It's rare for China's market, industry, and economic regulators to jointly host a meeting with the car industry on operational matters like pricing. The move shows how much scrutiny the nation's top leadership is paying to the sector, amid concerns the price war is becoming unsustainable and could send weaker companies into bankruptcy. However, the gathering didn't result in a mandatory directive and it's not clear what consequences manufacturers would face if they don't follow the verbal warnings, the people said. BYD and Xiaomi didn't respond to requests for comments. A representative from Geely referred to a recent speech by Chairman Li Shufu who said the company resolutely rejects price wars and will compete on technology and its values. The Ministry of Industry and Information Technology, the State Administration for Market Regulation and the National Development & Reform Commission didn't reply to faxed questions. The warnings come after BYD kicked off the latest round in the price war late last month with discounts of as much as 34%, leading to criticism from industry bodies and state media. Without naming BYD, the China Automobile Manufacturers Association released a statement saying the move by a certain company started a new round of 'price war panic' that was plunging the sector into a 'vicious cycle' and threatening supply chain security. 'Disorderly price wars intensify vicious competition, further compressing corporate profit margins,' the association said. Media outlets directly controlled by the Communist Party leadership including Xinhua, the People's Daily and state broadcaster CCTV have all published reports in recent days that called for automakers to stop discounting and restore order to the industry. Otherwise, this could lead to low-priced and low-quality products that will damage the international reputation and the image of 'Made-in-China,' the People's Daily said. This week's meeting marked the second time in recent days that industry leaders have been rebuked over 'zero-mileage' cars — a practice in which automakers that have failed to meet their sales targets offload new vehicles to supply chain financing companies or used car dealers. These essentially new cars then appear on the resale market with no mileage, while manufacturers record them as sales despite them not having reaching the end-consumer. The Ministry of Commerce also met with at least two major carmakers and online used cars platforms last week on the issue. Carmakers have been trying to pass on the hit from the price war to suppliers, demanding lower prices for parts and delaying bill payment by months. A price cut demand by BYD to one of its suppliers late last year attracted media coverage and scrutiny of how the EV behemoth may be using supply chain financing to mask its ballooning debt. A report by accounting consultancy GMT Research puts BYD's true net debt at closer to 323 billion yuan , compared with the 27.7 billion yuan officially on its books as of the end of June 2024, through delaying its payments to suppliers and other related financing. This article was generated from an automated news agency feed without modifications to text.
Malaysian Reserve
15 hours ago
- Business
- Malaysian Reserve
Chinese EV trucks will build our future cities
IF YOU think the world is starting to get used to surging sales of Chinese-made electric cars, the next wave of exports is going to be bigger, and more powerful. That's because the construction machinery giants that grew fat off the country's property bubble are looking for new markets to offset the downturn at home. Combined with looming electrification, the effects could be quite as dramatic as the other Made-in-China export booms which have so troubled trading partners. Consider Sany Heavy Industry Co. In 2020, 83% of its business was selling excavators, cranes, concrete mixers and the like to domestic developers. In the space of just four years, China's property crash has caused its turnover in that market to shrink by two-thirds. Overseas markets now account for more than 60% of revenue. It's hoping to raise US$1.5 billion (RM6.55 billion) via a Hong Kong IPO to help it double international sales to 100 billion yuan (RM60 billion), the South China Morning Post reported last month. Sany isn't alone. Its local rivals XCMG Construction Machinery Co, Zoomlion Heavy Industry Science & Technology Co and Guangxi LiuGong Machinery Co are all facing the same collapse of activity on the home front, where housing starts in the first four months of 2025 fell to their lowest level since 2003. That's left dismal returns on all the assets they built to service a market that's since disappeared — below 5%, less than half what Caterpillar Inc manages and well below the 7.7% at Komatsu Ltd. The best way out of this problem is to find export markets to get the production lines for all those diggers, dozers, lifters and trucks humming again. Zoomlion's international sales have followed Sany's in becoming the largest element of its revenue, and XCMG and LiuGong aren't far behind. There's plenty of work to go around. In the Persian Gulf, governments are using the windfall from the oil boom of the early 2020s to build a swath of major infrastructure projects, from the Middle East's first Walt Disney Co theme park in Abu Dhabi, United Arab Emirates, to a new international airport in Riyadh, Saudi Arabia, and a US$22 billion, five-year infrastructure plan for Qatar. Construction markets are also booming across South and SouthEast Asia and in parts of Africa. China's export market share in major categories of work vehicles has soared in recent years. As with passenger cars, electrification offers a potent route for further disruption. Batteries are often considered an ill fit for construction machinery, which has extreme power needs that diesel is particularly well-placed to deliver. But that's changing as lithium-ion cell-makers build cheaper and longer-lasting power packs that can often keep running as long as an eight-hour work day, according to IDTechX, a consultancy. Electric construction equipment sales will grow at 21% annually up to 2044, when they'll hit US$126 billion, IDTechX predicted last year. Chinese manufacturers have an advantage here. Local battery-makers Contemporary Amperex Technology Co and BYD Co are market leaders in LFP (lithium ferrophosphate), the cathode chemistry that's likely to be best-suited to site vehicles, thanks to its stability and low costs. Already, local construction machinery manufacturers produce about two-thirds of the electric bucket loader models on the market. Circumspect governments should be looking at ways to outcompete this shift. Instead they're raising the drawbridge. The European Union (EU) in April set tariffs as high as 67% on Chinese construction machinery, while the UK has more recently imposed duties of more than 30% on excavators made by Sany, Liugong and XCMG. The Indian joint venture between Tata Motors Ltd and Hitachi Construction Machinery Co last year called on New Delhi to raise levies against imported Chinese products, saying they'd already grabbed 22% of the market. Things are even worse in the US, where the US President Donald Trump administration is busy unpicking the heavy-duty vehicle emission standards introduced by former President Joe Biden. That removes much of the incentive for US-exposed manufacturers such as Caterpillar, Komatsu, Volvo AB and Deere & Co to innovate and compete with the coming onslaught. Work vehicles have tended to fly below the radar in discussions of urban emissions, but their vast size and power requirements give them a disproportionate share of engine pollution. China's 10 million construction machines emit more particulates than its 417 million road vehicles, according to the International Council on Clean Transport. With low-emission zones spreading across cities worldwide and older diesel vehicles increasingly restricted on the roads of major cities such as London, Paris and Madrid, construction machinery is increasingly going to find itself in the crosshairs as one of the biggest contributors to urban pollution. When that happens, Chinese manufacturers will have a solution ready to be driven from their parking lots. Will their incumbent overseas competitors be ready, too? — BLOOMBERG This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. This article first appeared in The Malaysian Reserve weekly print edition
Yahoo
3 days ago
- Automotive
- Yahoo
BYD Shares Sink as Carmaker Faces Backlash Over EV Price War
(Bloomberg) -- BYD Co. shares fell, bringing losses over the past week to more than 17%, on concern that its price cuts are drawing government scrutiny and becoming unsustainable for the Chinese EV industry. Billionaire Steve Cohen Wants NY to Expand Taxpayer-Backed Ferry Where the Wild Children's Museums Are The Economic Benefits of Paying Workers to Move Now With Colorful Blocks, Tirana's Pyramid Represents a Changing Albania NYC Congestion Toll Brings In $216 Million in First Four Months In a commentary on Sunday, the People's Daily — the mouthpiece of China's Communist Party — criticized the 'rat-race competition' and warned that price wars can seriously affect supply-chain security. Low-priced and low-quality products would seriously damage the international reputation of 'Made-in-China,' it said, without naming any specific companies. Also over the weekend, China's automobile industry association warned against 'vicious competition' that would hurt profit margins, impair product quality and hinder the healthy development of the industry. The Ministry of Industry and Information Technology agreed with that stance and will step up measures to root out unhealthy competition in in the auto sector and protect market order and consumer rights, media outlet Cailian reported. BYD has led the bruising price war that's engulfed China's auto industry, hurting profit and clouding the outlook for the fast-growing sector that leads the rest of the world in electric vehicle technology. Even though BYD sold 382,476 vehicles in May, its best month yet for 2025, year-on-year growth of 15% was the slowest since August 2020, except for a drop in deliveries in February last year due to the Lunar New Year holiday. BYD was at the fore of the latest round of discounting, slashing prices as much as 34% last last month in a move that was followed by rivals including Zhejiang Leapmotor Technology Co. and Geely Automobile Holdings Ltd. Analysts at Citigroup estimated that after BYD's discounts, traffic to its dealerships may have surged between 30% to 40% week-on-week. So far this year, BYD has sold 1.76 million units against a full-year target of 5.5 million. Morgan Stanley analysts including Tim Hsiao estimate that sales would need to average about 534,000 units per month for the rest of 2025 to reach its goal. The fourth quarter is typically a strong one for all carmakers as they try to move stock before the end of the calendar year. The deep discounting appears to be helping other automakers boost sales. Leapmotor sold 45,067 vehicles in May, up 148% year-on-year, while Geely Auto's deliveries increased 46% to 235,208 units. Meanwhile Xpeng Inc. saw sales triple in May, driven largely by its mass-market MONA M03 model. Notably, BYD's battery passenger electric vehicle sales of 204,369 last month topped its plug-in hybrid sales of 172,561, only the second time pure EV sales have been in front since early 2024. The company is also ramping up overseas sales, delivering more than 89,000 units in May, its highest on record. YouTube Is Swallowing TV Whole, and It's Coming for the Sitcom Millions of Americans Are Obsessed With This Japanese Barbecue Sauce Mark Zuckerberg Loves MAGA Now. Will MAGA Ever Love Him Back? Will Small Business Owners Knock Down Trump's Mighty Tariffs? Trump Considers Deporting Migrants to Rwanda After the UK Decides Not To ©2025 Bloomberg L.P. Sign in to access your portfolio
Straits Times
4 days ago
- Automotive
- Straits Times
BYD faces growing backlash over EV price war as May sales jump
HONG KONG – BYD shares continued their plunge despite monthly sales climbing to the highest in 2025 as the steep discounts the industry uses to entice buyers draws scrutiny from Beijing. The electric car manufacturer sold 382,476 vehicles last month, including 376,930 passenger cars, according to a statement on June 1. While that marked a high point for 2025, the year-on-year growth of 15 per cent was the slowest since August 2020, except for a drop in deliveries in February 2024 that coincided with a broad slump due to the Lunar New Year holiday. Despite the sales boost, BYD stock dropped almost 5 per cent in Hong Kong on June 2, which follows a more than 15 per cent slump last week, after a series of reports over the weekend indicated the industry's lengthy price war has caught the attention of the government. In a commentary on June 1, the People's Daily – the mouthpiece of China's Communist Party – criticized the 'rat-race competition' and warned that price wars can seriously affect supply-chain security. Low-priced and low-quality products would seriously damage the international reputation of 'Made-in-China', it said, without naming any specific companies. Also over the weekend, China's automobile industry association warned against 'vicious competition' that would hurt profit margins, impair product quality and hinder the healthy development of the industry. The Ministry of Industry and Information Technology agreed with that stance and will step up measures to root out unhealthy competition in in the auto sector and protect market order and consumer rights, media outlet Cailian reported. BYD has led the bruising price war that's engulfed China's auto industry, hurting profit and clouding the outlook for the fast-growing sector that leads the rest of the world in EV technology. The latest round of discounting came late last month, when BYD cut prices as much as 34 per cent in a move that was followed by rivals including Zhejiang Leapmotor Technology and Geely Automobile Holdings. Leapmotor sold 45,067 vehicles in May, up 148 per cent year on year, while Geely Auto's deliveries increased 46 per cent to 235,208 units. Meanwhile Xpeng saw sales triple in May, driven largely by its mass-market MONA M03 model. Notably, BYD's battery passenger electric vehicle sales of 204,369 topped its plug-in hybrid sales of 172,561, only the second time pure EV sales have been in front since early 2024. The company is also ramping up overseas sales, delivering more than 89,000 units in May, its highest on record. Analysts at Citigroup estimated that after BYD's discounts, traffic to its dealerships may have surged between 30 per cent to 40 per cent week on week. So far this year, BYD has sold 1.76 million units against a full-year target of 5.5 million. Morgan Stanley analysts including Tim Hsiao estimate that sales would need to average about 534,000 units per month for the rest of 2025 to reach its goal. The fourth quarter is typically a strong one for all carmakers as they try to move stock before the end of the calendar year. BLOOMBERG Join ST's Telegram channel and get the latest breaking news delivered to you.
