Why BYD is breaking into transport

The Chinese language electric-vehicle maker has been notably good at increasing into totally different, associated companies. Not solely can it make high-performing and protected batteries for automobiles, nevertheless it additionally does virtually every little thing in home, from designing automobile chips to mining lithium and different supplies. The truth that it has subsidiaries in each step of the EV provide chain allows the corporate to maintain its prices down and promote automobiles at extra aggressive costs.

Now, to drag that off as soon as once more, BYD is beginning a sea freight enterprise. As I simply wrote in a narrative revealed at this time, the corporate is assembling a fleet of at the least eight car-carrier ships that may transport BYD automobiles from factories in China to promote in Europe, South America, and different markets.

BYD has had a meteoric rise to develop into the Chinese language EV sector’s poster little one in recent times, and 2023 was notably good for the corporate. It bought 3 million electrical automobiles and plug-in hybrid fashions final 12 months, up from 1.8 million in 2022. BYD managed to beat Tesla to develop into the world’s top-selling EV firm within the fourth quarter of 2023. 

Whereas the vast majority of these automobiles have been bought in China, BYD’s export enterprise has been increasing considerably. It exported over 240,000 automobiles in 2023, greater than a fourfold improve from 55,000 automobiles in 2022; and the latter quantity was itself greater than a fourfold improve from 13,000 in 2021.

However one factor has been getting in the best way of those bonkers numbers: the shortage of car-carrier ships internationally. A bust cycle within the worldwide transport business since 2008, the technological problem of creating ships greener, and the truth that present vessels are sometimes already reserved by automakers in different international locations—these elements have collectively resulted in ever-rising prices to rent a ship that may transport Chinese language EVs overseas.

So Chinese language corporations like BYD and SAIC Motor are following within the footsteps of Japanese and Korean automakers: they’re constructing, chartering, and managing their very own fleets of ships. This January, one boat operated by BYD and one other operated by SAIC Motor set sail for the primary time, between them carrying over 10,000 autos towards Europe.