When it comes to car companies with relatively high sales of new energy vehicles among independent brands, I believe that many netizens will think of BYD. Especially in batteries, electronic controls and motors, we have deep technical reserves. Recently, BYD released the latest first-quarter financial report data. So, how does it perform?
Operating income of approximately RMB66.8 billion, net profit increased by approximately 240% year-on-year
Those familiar with BYD know that its business is not limited to passenger cars, but also includes mobile phone-related components, rechargeable batteries and photovoltaics. According to the data, BYD achieved operating income of 66.825 billion yuan in the first quarter, an increase of more than 63% year-on-year. Net profit exceeded 800 million yuan, an increase of about 240% year-on-year.
It can be seen that in terms of operating income or net profit, BYD's performance is relatively good. However, in terms of gross profit margin, it has decreased slightly compared with the same period last year. Public data shows that BYD's gross profit margin in the first quarter of this year was 12.40%, compared with 12.59% in the same period last year.
The reason for the decline is mainly related to the higher increase in raw material prices in the first quarter of this year. In particular, the manufacturing cost of batteries has increased surprisingly. In addition, raw materials such as steel and automotive chips related to car manufacturing have also risen in price.
Gross margin declined, but auto sales grew at a high rate
For a long time, the business of mobile phone-related components has been an important source of REVENUE for BYD. However, in recent years, the growth rate of the global smartphone industry has declined significantly. In this environment, BYD naturally cannot be alone. Public data shows that in the first quarter of this year, BYD's mobile phone parts and assembly business increased by only 5.2% year-on-year.
Although, BYD's performance in the mobile phone components and assembly business is sluggish. However, in the automotive sector, it has achieved rapid sales growth. According to the company's public data, more than 280,000 units were sold in total from January to March, which was eye-catching.
Anyone familiar with the automotive industry knows that economies of scale are very important. From the perspective of average monthly sales, BYD has become one of the leading enterprises of its own brand. Therefore, while the cost of raw materials has risen sharply, BYD can still maintain a good profit performance.
Abandoning the pure fuel vehicle business, BYD is determined to go to the high end
In early April, BYD released a blockbuster message. Starting in March this year, the production of fuel vehicles will be discontinued. In the future, it will only produce pure electric and plug-in hybrid vehicles, and become a 100% new energy vehicle company.
Among the traditional automakers, BYD became the first to abandon the pure fuel vehicle business. The reason why it is so decisive is that the sales structure of BYD's models has completely shifted to new energy. Public data shows that in March this year, BYD sold about 104,000 passenger cars, all of which are new energy sources. Among them, the pure electric model is about 53,600 units, and the plug-in hybrid is about 50,000 units.
While abandoning the fuel vehicle business, judging from BYD's recent "actions", its strategy towards high-end has become more prominent.
The first is the release of the latest model - BYD Seal, positioning the sports coupe, the competitor locked in tesla Model 3, the price is expected to be in the range of 200,000-300,000 yuan after listing. Equipped with dual front and rear motors, it has a strong acceleration performance and is built for consumers who are looking for performance.
Its Denza brand has also released the latest medium and large MPV model - Denza D9. From the design point of view, it is quite domineering, and it does not lose imported high-end MPVs at all. In terms of interior, it adopts a simple design concept and is equipped with a 15.6-inch central control large screen and a 10.25-inch full LCD meter. The introduction of a large number of comfort features shows a strong sense of luxury. It is reported that the new car will be listed in the near future and is expected to be priced at 450,000 yuan. From the perspective of positioning, it will lock in high-end models of joint venture brands, such as Mercedes-Benz's V-Class and so on.
Public opinion: Although IND has experienced a significant slowdown in mobile phone components and assembly business in the first quarter of this year, thanks to the strong sales performance of the automotive sector, the group's overall operating income and net profit have maintained a rapid growth momentum. With the official announcement of abandoning the traditional fuel vehicle business, IND will undoubtedly be more focused in the field of new energy. However, there are still many challenges in the future, that is, the continuous rise in the price of battery raw materials and the gradual cancellation of subsidies may affect the subsequent profit performance. Therefore, it is a very test of BYD's ability in corporate operations, let us continue to pay attention to it.