BYD Shares Face Technical Pressure Despite Robust European Growth

While BYD continues to post impressive delivery figures, particularly in the European market, its stock encountered selling pressure in Hong Kong trading. This divergence highlights a clash between strong fundamental performance and concerning signals from technical analysis.

Despite the positive operational news, BYD's Hong Kong-listed shares closed the session at HKD 93.10, marking a decline of 1.84%. In the US, the company's ADRs (BYDDY) traded near $12 in pre-market activity.

The technical picture reveals a classic short-term sell signal: the 10-day moving average has crossed below the 20-day average. Such a pattern, often triggering algorithmic selling and profit-taking, can temporarily overshadow fundamental strengths. From a chart perspective, the support zone around HKD 90.00 is now critically important. A successful defense of this level would significantly diminish the bearish implications of the current signal.

European Expansion Gains Remarkable Momentum

Recent data from the European Automobile Manufacturers' Association (ACEA) underscores BYD's accelerating traction across the continent. The company registered 21,133 new vehicles in Europe during November, representing a staggering year-on-year increase of 221.8%.

This performance brings BYD's volume in close proximity to Tesla's, which saw European registrations fall by 11.8% to approximately 22,800 units for the same month. Globally, BYD's sales from January through November reached 4.182 million vehicles, reflecting growth of 11.3%.

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A key driver behind the European surge is the expansion of fleet partnerships. The cooperation with the leasing giant Ayvens was extended to seven additional European markets this year, a move that is now generating substantial volume and contributed significantly to the strong November registration numbers.

Solid Fundamentals Underpin the Long-Term View

The fundamental outlook for BYD remains robust, presenting a more stable picture than the daily stock movement suggests. Even after adjusting for the 3:1 stock split executed in June 2025, the current share price remains elevated. Long-term investors largely view the recent weakness as a consolidation phase following a year of significant market share gains.

In Europe, brand awareness has increased notably this year. Marketing initiatives, such as the company's role as the official partner of the UEFA U21 European Championship in Slovakia in June, are translating into stronger order books for models like the Sealion 7 and the updated Seal series.

Concurrently, BYD's vertically integrated structure—spanning battery production to vehicle assembly—provides a crucial advantage amid ongoing price competition in the EV sector. This allows the company to maintain aggressive pricing while defending margins, a challenge many traditional automakers face with their electric vehicle programs.

Key Catalysts for 2026

As the year draws to a close, market attention is shifting to several specific catalysts for 2026:

• New Hungarian Factory: Production is scheduled to commence in early 2026. Local manufacturing is expected to circumvent EU tariffs, reduce logistics costs, and improve European margins over the medium term.
• Annual Delivery Figures: The complete delivery numbers for 2025 are anticipated in the first week of January. Analysts forecast a slight beat against already revised projections.
• Technical Levels: The HKD 90.00 support zone remains decisive. As long as the price holds above this level, the prevailing market interpretation will likely view the decline as a standard interim correction within a larger growth trend.