Munich Would you buy a Chinese car? “Not really,” says a young woman. A man with a three-day beard shakes his head. “I don’t intend to do that,” explains a passer-by. And a pedestrian says, “I think I’m a long way from buying a Chinese car.”
A little later, two of the four interviewees in the image film of the car manufacturer BYD raved about the design and the quality of the “Han” sedan. The Mercedes-Benz and Porsche museums in Stuttgart pass by in the background. The casual message: The car was indeed invented in Germany; but the future lies in China – specifically at BYD.
The video dates from the summer of 2020 and shows how meticulously the leading manufacturer of electric cars from the People’s Republic has been pushing ahead with its expansion into Europe for years. BYD is now about to make the leap to Germany, the most important market in the EU. To this end, the company has entered into a sales partnership with the Hedin Mobility Group.
The Swedish dealer group with 235 sales locations in eight countries has now announced that it will start selling BYD models in October 2022. The first vehicles should be delivered to customers by the end of the year. In Germany, the BYD products are to be presented and offered in a few hand-picked stores run by Hedin partners.
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Details about the shops and the prices of the vehicles are not yet known. In the course of the month, however, a separate German website (www.bydauto.de) is to go online. Either way, BYD’s entry into the German market should cause a sensation.
BYD controls the entire value chain – from the mine to the assembly line
“They are at the forefront of electric mobility and will also go their own way in Europe,” says Stefan Bratzel. The head of the Center of Automotive Management in Bergisch Gladbach particularly praises the Group’s high level of vertical integration. In contrast to most western car manufacturers, BYD manufactures the battery cells for its Stromer itself and produces the necessary lithium in its own mines.
This gives the company full control over the performance and cost of the battery, the heart of every electric car. That pays off. The “Blade” batteries from BYD are considered to be particularly durable and currently enable an electric range of up to 600 kilometers.
Also thanks to the good price-performance ratio, BYD is selling more and more vehicles. According to data from the statistics portal BSCB, there were 584,000 vehicles in the Chinese home market alone in the first half of 2022, more than twice as many as in the first half of 2021. For comparison: almost all major competitors, including VW, Toyota, Honda, Nissan and Geely, had to occasionally accept severe double-digit slumps in sales over the same period.
According to Jan Burgard, partner at the strategy consultancy Berylls Group, BYD’s success is based on a combination of a clever drive mix with pure electric motors and plug-in hybrids, a comprehensive model portfolio, a competitive price strategy and the development and in-house production of important components such as battery cells.
Insight into the production of the car manufacturer in Xi An in north-west China.
(Photo: imago images/Xinhua)
“In my opinion, BYD will continue the success story,” says Burgard. The group will also “cause a lot of attention” in Western markets. So far, the Asians in Europe have mainly been active in Norway. So far, the company has offered the all-electric family SUV “Tang” with seven seats and all-wheel drive.
European expansion could be dangerous for Volkswagen
At the end of last year, BYD was able to deliver the thousandth vehicle in Norway. According to data from Jato Dynamics, there were already more than 900 units in Europe in the first half of 2022. And now BYD also wants to sell its electric cars in the Netherlands, Sweden and Germany.
The Chinese attack could be dangerous for Volkswagen in the long term, since BYD has a broad and competitive range, especially in the entry-level and mid-range segments, says Berylls partner Burgard.
CAM director Bratzel even thinks that BYD has “the potential to play in a similar league to Tesla in the future”. However, the group would still have to catch up with digital networking. When it comes to e-drives, on the other hand, the Chinese have long since made it into the top five in the industry.
In addition to BYD, a number of other Chinese car companies also want to enter the German market and are challenging VW, BMW and Mercedes-Benz. The sales figures for Aiways, Nio, Xpeng, MG or BYD are still manageable with a total of 60,000 vehicles in Europe in the first half of the year.
For the German managers in the car strongholds in Wolfsburg, Munich and Stuttgart, the enormous growth rates of the group are quite worrying. They are sometimes more than 100 percent – per month.
More: Electric car maker BYD could overtake Volkswagen in China