BYD Co Ltd the Chinese electric automaker backed by Warren Buffett, will start providing a full suite of EV components to competitors and aspiring automakers to diversify its revenue sources amid declining car demand.
Among the parts that the Shenzhen-based company makes and now sells are electric-car batteries, powertrains and lights, founder Wang Chuanfu stated in an online press conference on Sunday. BYD, China’s biggest automaker of automobiles powered by alternative energy for the last six years, will use the brand FinDreams for the parts business.
Electric-car sales have been slumping in China since July, when the country reduced purchase subsidies, and the reduction has been exacerbated by the coronavirus outbreak. BYD, which is financially more stable than majority of local EV competitors, is betting the new business will help it get back to growth quicker even as the market contracts.
“BYD will open its technology and products to the entire world,” Wang stated. “FinDreams units will help change the role participants in Chinese auto industry play in the global new energy arena.”
BYD, established as a mobile-phone battery maker, has been rising by expanding into new businesses during the past two decades. The company started auto manufacturing in 2003 and presented its first vehicles powered by lithium-iron-phosphate batteries in 2006. It has since included electric buses, utility cars, energy storage equipments, monorail and insulated gate bipolar transistors to its lineup.
To help combat the spread of the coronavirus, the company broadened to face masks and reached a daily production capacity of 10 million units this last week, according to Wang.
The versatility of its producing operations has helped BYD become self-reliant on electric-car components. While until now it concentrated on making components only for itself, the company is now looking forward to take advantage of a potential recovery and future development of the market.
The annual value of batteries utilized in electric cars, electric buses and related energy storage is set to increase about 10 times to a potential $500 billion by 2050, as per Sanford C. Bernstein & Co.
To show its competitiveness, BYD on Sunday revealed test results of its so-called “blade battery,” touting it as a cost-competitive, more safe and compact offering. Nearly all automakers are in discussions with BYD over collaboration on the product, according to He Long, head of BYD’s auto battery business.
Last year, BYD signed an agreement with Toyota Motor Corp. on electric vehicle battery supply and joint product development, with the automakers setting up an jointly owned venture this month. BYD also works with Daimler AG on building Denza brand electric vehicles.