BYD Faces Domestic Headwinds as Global Ambitions Accelerate

The world's largest electric vehicle manufacturer, BYD, is navigating a complex landscape of record-breaking monthly deliveries coupled with a concerning year-over-year decline. Despite shipping an unprecedented 480,186 vehicles in November, the figure represents a 5.25% drop compared to the same period last year. This marks a third consecutive monthly retreat, raising questions about the company's trajectory.

At an extraordinary general meeting on December 5, Chairman Wang Chuanfu delivered a candid assessment. He publicly acknowledged for the first time that BYD's technological edge is diminishing, stating it is "not as strong as in previous years" and that the "wow factor" of its innovations is fading. He pointed to increasing product homogeneity across the auto industry as a key driver of intensifying competition.

The pressure is manifesting in market share. In September, rival SAIC Motor briefly overtook BYD with 439,800 monthly sales versus BYD's 396,300. Other domestic competitors, including Geely, Changan, and Chery, are consistently gaining ground.

The Divergence Between Home and Abroad

A deep dive into November's sales figures reveals a stark dichotomy:
* Domestic Sales: 348,300 units, a significant 26.81% decrease year-over-year.
* Export Sales: 131,700 units, exploding by 297% compared to the previous year.

This contrast highlights where BYD's current weakness is concentrated: its home market of China. In response, management has revised its full-year sales forecast downward from 5.5 million to 4.6 million vehicles. With 4.182 million units delivered so far in 2025, the company has achieved 90.9% of this revised target.

Operational Challenges and Strategic Pivots

Beyond market competition, BYD is managing immediate operational issues. The company has issued a recall for 88,981 Qin Plus DM-i plug-in hybrid vehicles manufactured between January 2021 and September 2023. Inconsistencies in battery pack assembly could reduce performance or disable pure electric driving mode. The remedy involves a software update and complimentary battery replacements where necessary.

Should investors sell immediately? Or is it worth buying BYD?

Concurrently, BYD is dismantling its digital payment network, Di Lian, used for settling supplier liabilities. Following regulatory scrutiny over concealed receivables financing, the company is transitioning over two to three years to cash payments or standardized invoices.

On the innovation front, Chairman Wang promised the introduction of new "heavyweight technologies" in coming months, though specifics were withheld. He emphasized that incremental improvements are insufficient, citing persistent customer complaints like slow charging speeds in cold weather as areas requiring breakthrough development. BYD plans substantial R&D investment over the next two to three years, focusing on next-generation electrification and smart vehicle technologies, leveraging its workforce of 120,000 engineers.

A bright spot emerges from BYD's premium brand portfolio—Fang Cheng Bao, Denza, and Yangwang. These marques now contribute 10.8% to total sales, indicating progress in the higher-margin vehicle segment.

International Expansion Gains Momentum

Overseas operations are providing a crucial counterbalance to domestic softness. November marked the first time BYD's monthly exports surpassed 100,000 units. In Germany, sales surged eightfold to 4,026 vehicles in November, a period during which Tesla registrations fell by 20.2%. Furthermore, on December 1, BYD launched its first plug-in hybrid for the Japanese market, the Sealion 6 SUV, signaling deepening global ambitions.

The company's path forward hinges on its ability to reignite growth in China while capitalizing on its potent international expansion to offset domestic pressures.