byd spends more than it earns, why is it doing "loss-making business"?
2024-09-20
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recently, major domestic listed automakers have successively announced their financial reports for the first half of 2024. byd, geely auto, great wall motors and seres have achieved good results in both operating income and profits. among them, byd achieved revenue of 301.127 billion yuan and net profit of 13.631 billion yuan, ranking first among listed automakers.
in terms of profit per vehicle, great wall motor, geely auto, ideal auto, byd, and seres ranked in the top five. it is worth noting that although byd is firmly in the leading position in sales, revenue and net profit, it ranks only fourth in profit per vehicle, about 8,500 yuan. what is even more shocking is that in the first half of this year, byd's r&d investment was as high as 20.2 billion yuan, far exceeding its net profit. why does byd spend more than it earns in this "loss-making business"?
cultivate a "technical fish pond" for high-quality development
it is not difficult to find out from the financial report that byd has invested heavily in r&d, market expansion, brand building, etc. these factors have led to the company's relatively low profit per vehicle.
in the first half of this year, byd's r&d investment reached 20.2 billion yuan, a year-on-year increase of 42%, about 6.6 billion yuan higher than the net profit in the same period, setting a record high. among the more than 5,300 listed companies on the a-share market, byd's r&d expenses rank first. as of now, byd's cumulative r&d investment has approached 150 billion yuan, which is an astonishing figure. at the same time, byd's technical talent team is also growing. currently, among the 900,000 employees, there are nearly 110,000 technical r&d personnel, making it the automaker with the most r&d personnel in the world.
taking the employee salary item in r&d expenses as an example, byd's expenditure in the first half of this year was 11.28 billion yuan, an increase of 42.1% from 7.94 billion yuan in the same period of 2023. this is a necessary expenditure for byd to expand its r&d team and talent pool.
currently, byd has a team of more than 4,000 people in the field of intelligent driving, including 3,000 software engineers alone. in terms of scale, byd's intelligent driving team is second only to huawei, whose intelligent driving team will exceed 7,000 people by the end of 2023, exceeding the scale of intelligent driving teams of xpeng, zeekr, xiaomi and others.
popularizing new energy vehicles benefits consumers
from the "lower price of electricity than oil" at the beginning of the year to the fifth-generation dm technology launched in the middle of the year, byd has continuously optimized product design through technological innovation under the vertical integration strategy, enabling more consumers to enjoy advanced new energy technologies at lower prices. through "technological equality", byd has played the "three good" trump card of "good technology + good products + good prices", and truly benefited consumers with its hard power.
at the same time, byd pays more attention to market acceptance and consumer interests in its pricing strategy, and tends to launch new energy vehicles into the market at more affordable prices.
in the long run, this strategy is of great significance to byd's sustainable development. by continuously lowering the purchase threshold and use cost of new energy vehicles, byd can attract more consumers to pay attention to and purchase new energy vehicles, thereby promoting the rapid development and popularization of the new energy vehicle market and truly revitalizing the entire new energy market. at the same time, through continuous technological innovation and product upgrades, byd can also continuously improve product performance and quality, meet the growing needs of consumers, and further consolidate and expand market share. the two-way rush between the enterprise and the consumer side has become a solid foundation for promoting the long-term high-quality and sustainable development of the enterprise.
at the same time, byd's success has also set an example for other chinese brands in the auto market. led by chinese brands such as byd, the chinese auto market is gradually breaking the pattern of joint venture profiteering monopoly, achieving a breakthrough in market share and rapid growth of new energy vehicles. this is not only a historic change in the chinese auto market, but also an important adjustment in the global auto market structure. according to the data from the china passenger car association, the market share of chinese brand passenger cars reached 63.4% in august, a record high. it broke the pattern of joint venture profiteering monopoly in the traditional chinese auto market. the rapid growth of new energy vehicles is the key factor in the rapid increase in sales of chinese brands. in july this year, the market share of new energy passenger cars in china exceeded 50% for the first time in a single month, reaching 51.1%; in august, the penetration rate of new energy vehicles further increased to 53.9%. it has become a fact that new energy vehicles continue to seize the fuel vehicle market, and the differentiation of "ice and fire" has further intensified.
in just a few years, new energy vehicles have developed from niche models to the mainstream of the market. this change is inseparable from the independent brands' insistence on technology research and development to continuously improve product strength. i believe that with the joint efforts of chinese brands such as byd, the chinese auto market will usher in a more prosperous, healthy and sustainable future.
proofread by xu heng
