Note
BYD, a Chinese electric car company, has expanded globally by targeting emerging markets and focusing on small countries like Malta to boost sales. Initially facing challenges with unimpressive car designs, BYD invested in research and development, integrated its supply chain, and introduced the game-changing Blade battery, leading to a significant increase in sales. Despite facing tariffs in major markets like the US and the EU, BYD has seen success in the EV industry, with plans for further expansion in countries like Brazil, Thailand, Turkey, Hungary, and Mexico. BYD’s success is attributed to its innovative approach, mastering affordable EVs, and the power of China’s brand of capitalism, rather than solely relying on government support.
Highlights
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2024-10-29 11:14 In 2004, at the Beijing Auto Show, Wang outlined his vision to use batteries to change the future of the automotive industry. Very few investors took him seriously, but a very important one did. In 2008, Warren Buffett’s Berkshire Hathaway invested $232 million in BYD. Call it the Buffett effect, but shares of BYD have jumped 500% since Buffett.
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2024-10-29 11:14 The early models of BYD were so unimpressive that Elon Musk, CEO of Tesla, publicly laughed at BYD’s design in a Bloomberg interview in 2011.
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2024-10-29 11:16 They brought in expensive designers from Alfa Romeo and Audi to make better looking cars. They also developed what’s called a vertically integrated supply chain. Here’s Danny again. BYD largely creates its own products. It doesn’t have to rely on external forces for the most important components to make its automobiles. From the mining of the materials to make the electric vehicle batteries, all the way through to the components that power the cars, from the chips, semiconductor chips, to even the seats, for example, that it is able to controls so much of a supply chain.
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2024-10-29 11:17 Wang and his team went against the tide and chose to make batteries with lfp, which is in general cheaper and safer. But it comes with a huge flaw. It lacks energy density, meaning it couldn’t go very far on a single charge. People thought LFP could never be used for an individual who wants to go on a road trip, things like that. But through his engineering innovations, the work they had done to improve the energy density of LFP chemistry, and the work they did to design a pack and a software system that can kind of get the maximum amount of energy out of that battery.
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2024-10-29 11:18 Today, Ford, Tesla and Toyota all use LFP batteries in their cars in China, as do many Chinese automakers.
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2024-10-29 11:18 And in just three years after BYD released the Blade battery, it went from selling under 180,000 electric and hybrid cars to selling 10 times that much.