JAKARTA - What is happening in China's automotive industry, especially in the electric car segment, is interesting to observe as the world's largest automotive market.
So many electric car manufacturers from China have increased domestic competition amid the issue of declining demand for electric cars. In addition, Tesla's actions in price wars since last year have finally made BYD inflamed.
Main players in the Chinese and Global electric car segments, BYD are actually heating up competition as they actually cut their cheapest electric car price, Seagull, by 5 percent.
Reported by Reuters, March 6, with this price cut, BYD Seagull's price tag is 69,800 yuan (around Rp. 151.5 million). Seagull itself is a compact electric car that was previously the product of BYD at the most affordable and one of the best-selling.
BYD is known to have aggressively paid off prices since the price war began by Tesla last year. This aggressive strategy has succeeded in making BYD the world's number one electric car seller, although most of its sales are still dominated by the Chinese market.
Throughout 2024, BYD has been offering price cuts. Previously, they also cut the price of the Yuan Plus crossover, their best-selling car known as Atto 3 in the international market, to nearly 12 percent. The price drop offered by BYD is deeper and includes more models than other competitors.
Amid China's slowing economic growth, electric car sales (including exports) are expected to continue to rise 13 percent to 11.5 million units by 2024. This figure is much lower than the 38 percent growth spike that occurred in 2023.
Apart from BYD, price wars are also being followed by other big players such as Tesla, Geely Auto, GAC Aion, Leapmotor, and Xpeng.
Chinese Merchants Bank International analyst Shi Ji predicts BYD will continue to provide discounts throughout 2024. This will indeed reduce BYD's profit margin, but some losses can be reduced by saving production costs from suppliers.
Until now, BYD's profit margin is still well maintained. According to a Reuters calculation, BYD posted a profit margin of 22 percent in the third quarter, up from 18.7 percent in the second quarter.
In addition to being aggressive in the domestic market, BYD is also actively expanding its wings to the international market. They are spearheading China's electric car expansion to Australia and are already starting factory construction in Brazil.
Meanwhile in Indonesia, BYD officially entered the Indonesian market on January 18 by releasing Seal, Atto 3, and Dolphin. And BYD just officially released their third price at the Indonesia International Motor Show (IIMS) 2024 exhibition.
Not only presenting superior products, this brand from China also provides the best program in order to provide a sense of security for consumers.
On each purchase of these three BYD models, the company will provide a warranty for six years or 150,000 km for vehicles, eight years or 160,000 km with a State of Health (SoH) of approximately 70 percent for battery traction, and eight years or 150,000 km for its driving unit.
For the price of a number of models, the manufacturer priced IDR 425 million on Dolphin as an entry-level EV, then Atto 3 worth IDR 515 million, and Seal which started with a tag of IDR 629 million for Premium type and IDR 719 million for Performance.
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