BYD Co., the world’s largest electric-vehicle (EV) maker, reported a sharp decline in third-quarter profit as mounting domestic competition and heightened industry scrutiny weigh on its sales outlook.
The Shenzhen-based automaker said Thursday that quarterly profit fell 33% from a year earlier to 7.82 billion yuan ($1.1 billion). Total revenue also dropped 3% to 194.98 billion yuan, falling short of analyst expectations of 216 billion yuan.
During the period, BYD delivered 1.15 million new energy vehicles, including pure-electric and plug-in hybrid models, marking a 1.8% decrease compared with the same quarter in 2024. By contrast, domestic rivals Geely Automobile Holdings and Chongqing Changan Automobile Co. posted strong third-quarter gains of 96% and 84%, respectively.
The company faces challenges in maintaining its dominance in China, where a prolonged EV price war has raised government concerns about potential declines in product quality. Earlier this year, BYD lowered its 2025 sales target by 16% to 4.6 million units. In September, it lost its spot as China’s best-selling automaker to state-owned SAIC Motor Corp., following its first year-on-year sales decline in 18 months, according to the China Association of Automobile Manufacturers.
Analysts attribute the slowdown largely to BYD’s strategy of reducing inventory ahead of its 2026 model launches. Citigroup reported that the company’s absolute and relative inventory measures fell month-over-month in September.
“A ‘de-stocked’ BYD could regain market favor, thanks to its defensive margin trends and cost advantages compared with peers,” analysts including Jeff Chung noted. They also highlighted the company’s strong export growth, with overseas sales up 160% year-on-year in the third quarter, driven by demand in Europe and Latin America.
BYD is also ramping up investment in research and development to support future product updates and the expansion of its high-end luxury Yangwang and Fangchengbao brands next year.
While Beijing has urged industries, including automakers, to end unsustainable price wars, the impact so far has been limited. Market watchers nonetheless anticipate a potential sales boost in the final quarter before certain subsidies and tax incentives are phased out.
