China's BYD charges way more for EVs sold in export markets. It's not just fees and tariffs driving up costs.
LONDON — U.S. and European politicians have raised alarms that their domestic auto industries could be destroyed by a wave of cheap Chinese electric vehicles. But so far, China's top EV maker, BYD, has dramatically hiked export prices compared to what it charges at home rather than undercut foreign rivals.
BYD’s big export markups also underscore the massive cost advantages that China’s EV industry has over foreign competitors. China’s EV leader has squeezed costs from every stage of production, from raw materials to batteries, land and labor, according to experts on China's auto industry and battery-cost data provided to Reuters.
For now, Chinese automakers, led by BYD, are content to keep export prices elevated and reap the profits, said Ben Townsend, head of automotive at UK-based Thatcham Research, an industry-funded firm that works on safety issues with automakers, including some from China. He said Chinese EV makers often struggle to break even or squeeze out a small profit in their home market.
By comparison, the Reuters analysis found that Tesla, which has a higher cost base than Chinese rivals, sells its Chinese-made Model 3 for only 37% more in Germany than in China, according to Tesla’s web site. ‘BARGAINING POWER’ BYD has emerged as the dominant player in China's electric-vehicle market. It's now investing heavily and growing sales in markets worldwide.
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