Despite fierce competition in the Chinese market, China’s leading electric car maker BYD on Monday reported a tripling of its half-year net profit.

In a report to the Hong Kong Stock Exchange, it said its net profit for the January-June period was 10.95 billion yuan ($1.5 billion), up nearly 205 percent year-on-year.

The result was in line with estimates given by the company in July, which ranged from 10.5 billion to 11.7 billion yuan. ($1 = 7.29 yuan).

Half-year sales also rose sharply year-on-year, up 73 percent to 260.1 billion yuan.

Demand for electric cars has surged in recent years in China, the world’s largest emitter of greenhouse gases.

The company, which counts US investment firm Warren Buffett among its investors, wants electric and hybrid cars to dominate its sales by 2035.

Generous subsidies have helped boost sales in recent years, while local manufacturers have also helped spur growth in the industry.

“In the first half of 2023, it benefited from the shift towards electric, smart and networked cars, and emerged as a strong contender in a tough market,” the company said, adding that it “ranked first in passenger car sales among Chinese car companies.”

The company initially specialized in the design and manufacture of batteries, and later the company diversified to include the automotive sector in 2003.

Foreign manufacturers rely on BYD for batteries, including Tesla, BMW, Mercedes and Audi.

This month, the company became the first global manufacturer to surpass five million in production of electric vehicles, crowning itself “the world’s leading manufacturer of new energy vehicles and electric batteries.”

Fierce competition in the electric car world in China

Analysts say China is leading the world in electric vehicle production.

The country has been investing heavily in related technology since the early 2000s.

Federal and local authorities have offered billions of dollars in subsidies and tax breaks, and awarded public transportation contracts to electric car companies.

The company, based in Shenzhen, a technology hub in southern China, stopped producing petrol-powered cars last year and now focuses exclusively on hybrid and electric models.

Chinese electric vehicle brands have gained popularity in recent years as the company faces stiff competition from several local brands including XPeng, Nio and Geely.

Under intense pressure to outdo each other, Chinese automakers are engaged in a price war, especially amid the country’s turbulent post-pandemic economy as consumer spending slows.

In July, BYD was still the biggest seller of electric vehicles in China, selling about 262,000 units, the company said.

According to China Automobile Association data, in the first half of 2023, the group’s new energy vehicle market share expanded to 33.5%, an increase of 6.5% from 2022, continuing to solidify its leading position in China.

In comparison, US Tesla, its main competitor, sold around 64,000 units during the same period. BYD has overtaken German “Volkswagen” as the best-selling car brand in China.

(AFP, The New Arab)