​Suppliers to Reduce Costs amid Cost Wars: BYD and Competitors in China

China’s electric car market is the world’s largest — and its most fierce, with dozens of companies jostling for position. Chinese automakers are pressuring providers to give significant cost savings in the rapidly expanding but crowded home industry for electric vehicles. According to a supplier’s contact, which was evidently leaked and broadly distributed on the internet in China, BYD, the largest maker of electric vehicles in the world, requested a 10 % price reduction starting in the new year. According to the internet with the content line” BYD Passenger Vehicle Cost Reduction Needs in 2025,” He Zhiqi, BYD’s executive vice president, said the competition for so-called “new energy cars was entering a “decisive war” or “knockout match.” We need the entire supply chain to collaborate and keep costs down in order to increase the competitiveness of BYD passenger vehicles, according to Mr. He wrote. A BYD official stated on Wednesday that supplier negotiations are a regular practice in the auto industry on Weibo, a Chinese social media platform. He added that because of BYD’s large size, it sets “price decrease targets” for providers that are not required and can be negotiated. He did not specifically address the internet or inquire as to whether other companies had made similar requirements. Despite requests for comment, BYD did not respond. Earlier this month, SAIC Maxus Automotive, an shoulder of Taiwanese state-owned automobile manufacturer SAIC, sent a letter to its providers asking for a 10 cent reduction in costs, citing oversupply in China’s car industry, according to reports reviews in state media. The letter noted that the price war is not anticipated to end soon because there are so many car manufacturers releasing new models. The article content is retrievable with difficulty. In your browser’s settings, kindly enable JavaScript. Thank you for your patience while access is verified. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times. Thank you for your patience while access is verified. Already a subscriber? Log in. Want all of The Times? Subscribe. 

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