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The electric car industry has a new market leader: China's BYD, which stands for Build Your Dreams. Who is this player of stature? And what makes the automaker unique? Five questions and answers about BYD.

While BYD is not yet well known in the Netherlands, it is a very different story in homeland China | Credit: Getty Images

In the last quarter of 2023, the Chinese automaker sold more cars than American Tesla. BYD was able to add 526,000 cars sold. Competitor Tesla ended up selling 484,000 units. Over all of 2023, Tesla did sell more electric cars.

What kind of party is BYD?

BYD was founded in 1995 in the city of Shenzhen in southern China. The brand has its origins in battery production. For example, it supplies lithium-ion batteries for cell phones to Nokia and Motorola. BYD also makes 65 percent of the world's production of rechargeable nickel-cadmium batteries. This gives the brand a good base for the production of electric cars. In 2003, the BYD Auto branch was established. Although BYD is not yet well known in the Netherlands, it is a very different story in China. It is among the country's largest manufacturers and sold 1,862,428 fully electric and hybrid cars in 2022.

What's special about this carmaker?

BYD develops the batteries for its cars itself. This is different from the bulk of manufacturers, which outsource battery production. So while many brands have to take into account the dimensions of third-party batteries in the design of cars, that does not apply to BYD. By doing the design and production itself, the Chinese carmaker can play with the design. The outcome is the so-called "blade battery," which through a new arrangement provides more space inside the car itself. The battery is not made of lithium ion, but lithium iron phosphate (LFP). That contains no nickel or cobalt, which allows BYD to stay away from mines notorious for poor working conditions and negative environmental impact. Also, the battery is cheaper to build.

Does that make BYD's cars cheaper?

The self-produced battery affects the price. BYD markets its models at a competitive rate. It says it does this to make electric driving accessible to everyone. German research firm Jato Dynamics calculated that a Chinese electric car is on average 29 percent cheaper than a European version. Although the very affordable cars generally do compromise a bit on power and range.

How popular is BYD in the Netherlands?

BYD's cars are now for sale in the Netherlands. To do so, the company works with Louwman, a dealer that also sells the Mercedes, Lexus and Toyota brands. In 2022, 180 cars were sold. In 2023, there were 1,230. The BYD Atto 3 is the most popular. Tesla is doing considerably better: last year nearly twenty thousand were registered in the Netherlands.

At the moment BYD is still very small in the Netherlands, but worldwide it has become the market leader. In Europe, too, the Chinese-brokered cars are in eager demand. Of all electric cars sold in Europe in 2021, four percent will come from China. Last year it was already eight percent.

How does Europe view the rise of Chinese car brands such as BYD?

While Europe encourages the use of electric cars, the European Commission is not happy with Chinese cars on the roads. "Electric cars are crucial for a clean economy. But worldwide markets are now flooded with cheaper Chinese electric cars," President Von der Leyen said earlier. "The price of those cars is kept artificially low with huge state subsidies. This distorts our market." An investigation should show what steps can be taken, such as increasing the import tariff. This has happened before with solar panels from China: in 2013, tariffs ran as high as 65 percent.

Also read:

  • Another new Chinese 'Tesla competitor' storms the European market

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