BYD Slows Factory Expansion And Reduces Production Shift In China, What's Up?

JAKARTA - A well-known automotive manufacturer from China, BYD has taken steps to slow its intensity in expanding factories over the past few months in China.

More than that, the company has also reduced the schedule for factory shifts in the bamboo curtain country.

Reuters reported on Thursday, June 26, the decision was taken because BYD has experienced a positive sales trend in recent years that has made it the king of electric cars at home to beat Tesla. For this, it also has an impact on the increasing inventory side even though Tesla has offered a large discount on China's highly competitive automotive market.

According to an anonymous source, BYD has canceled night shifts and reduced production by at least a third of the capacity in some of its factories.

Additionally, one source said the previously unreported action was in place at at least four factories and BYD had also suspended several plans to establish new production lines.

However, another source said that the move had to be taken because it was to save costs. While others said this action was taken due to sales failing to meet the target.

BYD itself did not provide any comments regarding this phenomenon.

BYD's global sales yielded positive results last year by successfully selling 4.27 million, most of which are Chinese markets.

However, this manufacturer has a target to boost sales by 30 percent this year globally to 5.5 million units.

As measures to reduce production shifts were taken, production growth from BYD slowed to 13 percent and 0.2 percent from year-on-year in April and May. This is the slowest rate since February 2024 when factory activity is disrupted by the Lunar New Year holiday for a week.