BYD’s outperformance highlights China’s manufacturing capabilities
In the fourth quarter of 2023, Tesla’s electric vehicle delivery volume reached 485,000 units. Although it exceeded expectations, it was lower than BYD’s 526,000 units, and it lost its position as the leader in electric vehicle production. In fact, this is just a comparison of electric passenger cars. BYD also produces buses, trucks and various hybrid vehicles, and its total output is much stronger than Tesla.
Musk, the founder of Tesla, risked accusations of political incorrectness and came to China to set up a factory because he saw China’s strong potential in manufacturing. Tesla’s ability to turn a profit from a loss is entirely due to the high efficiency of the Shanghai factory to reduce overall production costs.
After Musk saw China’s production capacity with his own eyes, he felt ashamed and believed that China would sooner or later surpass Tesla in new energy vehicles and become the world’s leader, but he did not expect that day to come so soon.
In 2023, BYD will sell a total of 3.024 million new energy vehicles, which is 67% more than Tesla’s 1.81 million vehicles, leaving it some distance behind. However, Tesla mainly produces mid- to high-end passenger cars; while BYD produces many affordable cars that cost less than 100,000 yuan. Because big and small take all, China has surpassed the United States, South Korea, Germany and Japan in the past few years to become the world’s largest exporter of passenger cars.
China’s automobile manufacturing industry has always been lagging behind. One of the important reasons why it can make a big turnaround this time is that the automobile manufacturing industry has to change its track, from manufacturing gasoline vehicles to manufacturing electric vehicles. This has led to the United States, Japan and European countries. The valuable experience accumulated in manufacturing automobile engines was suddenly wiped away, giving China the opportunity to compete with them on the same starting line; in this way, China’s advantages in manufacturing were fully revealed.
China has a large local market. Global passenger car sales in 2022 will be 68.7 million units, of which 23.6 million units (34.4%) will be sold in China. With such a large market demand, it is enough to support the growth of local manufacturing without being restricted by export sales. This is the basis for China to develop its own unique technology. BYD’s breakthrough in self-developed blade batteries is largely due to its large scale, which makes it easier to accumulate experience and achieve the effect of quantitative changes and qualitative changes.
The automobile manufacturing industry has always been an industry with a relatively high proportion of assembly; some companies specialize in making engines, some specialize in gear shifting clutches, some specialize in chassis, some specialize in spindles, and some specialize in appearance design. For many big brands, only about half of their parts are manufactured by their own companies. BYD has 70% of its parts produced by its own company. There are three key links in the production of electric vehicles: batteries, electric motors (motors), and AI automatic control. BYD has its own dedicated research and development team. Unlike Tesla, which has shortcomings in batteries.
The advantage of China’s manufacturing industry is that it has a complete industrial chain and not only technical talents, but also production management talents. Its self-sufficiency capability is much higher than that of Western countries. China originally did not mind using some parts produced by the West to learn from its strengths and offset its weaknesses. However, in recent years, Western countries, instigated by the United States, have boycotted and banned China. The problem is that the West has far more shortcomings in the industrial chain than China. The Western approach can be described as exploiting one’s own shortcomings and attacking others’ strengths, which is really unwise.
2024-01-09 20:31:55
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