BYD's Wang Chuanfu: The company's global long-term sales target is 10 million units, with half of them overseas

One of the highlights of BYD's performance in 2023 is its overseas expansion. Currently, BYD's presence has spread to more than 70 countries and regions, over 400 cities worldwide. BYD has started investing in building factories in overseas regions such as Brazil, Thailand, and Hungary.

On March 29th, a report released by a team led by JP Morgan analyst Lai Yizhe pointed out that recently, BYD Chairman Wang Chuanfu and senior management conducted a performance roadshow together. The management team has set a long-term global sales target of 10 million units for BYD, with half of them overseas. From the second half of 2024 to 2026, BYD's overseas production capacity will start to ramp up, with an initial total capacity of 700,000 to 800,000 vehicles.

The financial report shows that in 2023, BYD's overseas revenue reached 160.222 billion RMB, a year-on-year increase of 75.2%. Overseas revenue accounted for 26.6% of total revenue, an increase of 5.03 percentage points compared to the same period in 2022. In 2023, BYD's passenger car exports reached 242,000 units, a 334% increase year-on-year.

JP Morgan pointed out in the report that BYD's strategy is to focus on markets without local brands, such as ASEAN, Latin America, the Middle East, and Africa, while seeking opportunities to enter some EU countries. The company's overseas profitability is expected to remain higher than domestic.

Accelerated Expansion of Overseas Business

Wall Street News previously mentioned that since 2021 when BYD announced its strong expansion into overseas markets, its overseas business has entered a period of accelerated growth.

BYD's overseas market expansion has a clear strategic plan: continuously expanding the number of export countries on one hand, and striving to improve its product matrix on the other. Currently, BYD has a presence in over 70 countries and regions across six continents, spanning over 400 cities.

In terms of product matrix, BYD's current exported product line is relatively single, mainly focusing on the Dynasty series models. In order to gain a larger market share and influence in the global market, BYD plans to expand its overseas market by introducing multiple brands such as Tang, Song Pro, and Yuanwang to target different user groups.

In terms of export volume, in 2023, BYD's export volume reached 243,000 units, a 337% increase year-on-year. The overseas sales growth rate not only far exceeds BYD's domestic sales growth rate (61%), but also surpasses the overall domestic electric vehicle export growth rate (80.9%).

This has led to BYD's overseas business revenue reaching 160.22 billion RMB in 2023, a 75.2% year-on-year increase, significantly higher than the 32.9% growth in domestic business; at the same time, the revenue proportion has also increased by 5 percentage points to 26.6%.

As the domestic market share of new energy vehicles approaches its ceiling, the overseas market is expected to become a key driver for BYD's sales and profit growth.

Morgan Stanley pointed out in its report that during this roadshow, Wang Chuanfu emphasized the importance of using artificial intelligence to improve the level of factory automation, especially in overseas factories, in order to save labor costs. This is a major positive factor for enhancing BYD's profitability