TECH - Why Tesla Rival BYD Charges Up To 3x More For EVs In Europe While China Prices Remain Shockingly Low | Benzinga
While fears of a Chinese EV invasion grip the United States, a surprising trend has emerged: China’s top electric vehicle maker, BYD Co. (OTC:BYDDY) (OTC:BYDDF), isn’t flooding Europe with bargain-basement cars. Instead, it’s charging significantly higher prices compared to their home market, raking in hefty profits.
BYD Looks At High Prices, High Profits: A Reuters investigation reveals BYD is marking up export prices by massive margins – sometimes nearly triple – for popular models like the Atto 3 and Dolphin compared to China. In Germany, for instance, the Atto starts at a whopping $42,789, compared to a much friendlier $19,283 price tag in China.
So, Why The Disparity? It all boils down to profits. BYD faces fierce competition in China’s cutthroat EV market, forcing them to keep prices low. By jacking up export prices, they capture significantly higher margins they can’t achieve domestically.
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Cost Advantages Fueling Profits: BYD enjoys several cost advantages over foreign competitors. They control most of their production chain, from raw materials to batteries, leading to significant cost savings. Additionally, China heavily subsidizes EV production, further lowering costs. This edge allows BYD to offer competitive prices in Europe, even after substantial markups.
Tesla’s More Modest Markup: Interestingly, Tesla, Inc. (NASDAQ:TSLA) with a higher cost base than BYD, only marks up its Chinese-made Model 3 by 37% in Germany. This suggests BYD’s ...