In the past year, BYD's sales of new energy vehicles increased by 208.64%, and the total sales volume reached 1,863,500 vehicles, which not only took the lead in the field of new energy vehicles, but also took the lead in the total sales volume of automobile enterprises.
For BYD, over the past three years, market sales have consistently shown a leapfrog growth. In 2020, BYD's new energy vehicle sales were only 179,000 units, surging to 580,000 units in 2021, and reaching 1.8623 million units in 2022, with a continuous annual sales growth rate exceeding 200%.
Figure1: Wangchuanfu, chairman of BYD
The hot sale new energy vehicles of BYD, together with its "BYD Micro", is also following the trend, the reason is only provided automotive grade chip for BYD new energy vehicles can fulfill business valuation and be doubled to 20 billion yuan. To provide greater development space, BYD worked for three years to promote the separation and independent listing of its semiconductor industry. However, at a critical moment, BYD announced the termination of the semiconductor plan. What are the specific reasons behind this decision?
Think outside the box, BYD call of its semiconductor industry
The success of BYD in the field of new energy vehicles is closely related to its emphasis on independent research and supply. From blade batteries to automotive grade chips, BYD avoids concerns about being dependent on others and worries about high component costs. This approach meets the self-sufficiency needs and allows BYD to become a key component seller in the field. For example, selling "blade batteries" to competitor TESLA.
For BYD, the driving force brought by battery is very important, and the performance advantage brought by chip as the "brain" of automobile is equally important. Compared with traditional fuel vehicles, new energy vehicles have greater demand for chips, and the consumption is three or four times higher than that of fuel vehicles.
Figure2: technical staff are discussing
BYD is developing new energy vehicles, and at the same time, it is also laying out semiconductor business, which is indeed a prescient choice. For BYD Semiconductor three years ago, the urgent problem was to expand the market scale. After all, BYD's own production of new energy vehicles and the use of vehicle regulation chips were limited at that time. To expand the market scale, the simplest way is to push BYD Semiconductor to split from its head office and become a new enterprise that can be listed independently.
In order to solve this problem, BYD planned and prepared for three years. However, just when everyone was anticipating BYD Semiconductor's listing on the growth enterprise market, BYD suddenly announced the halt of the previously ongoing BYD Semiconductor "independence" initiative on December 30, 2022 .
Figure2: functions of IGBT
Clearly, it has been in full swing for three years and made great efforts, but suddenly announced the termination of all plans. It has to be said that BYD does not play cards according to common sense. Doesn't BYD want its semiconductor business to expand anymore?
The business wisdom of BYD, change with market changes
While peers think BYD group is capricious, insiders have clearly summed up BYD's business wisdom through two points. First of all, For the booming BYD, it has seen the huge potential of the new energy vehicle market. If it is eager to promote the listing of the semiconductor sector at this time, it will become a constraint to limit the expansion of BYD's semiconductor scale.
In the past three years, from 179,000 vehicles to 1,862,300 vehicles, BYD's own sales scale is growing, and the average monthly sales volume is almost 200,000 vehicles. It is no longer necessary to rely on the semiconductor sector to go public to collect money, and the huge wealth brought by the sales business of new energy vehicles is enough to "transfuse blood" for enterprises to create research and expand their scale.
Figure3: Energy vehicle assembly line
Secondly, BYD have to self-sufficient. When BYD advocated promoting the split and listing of the semiconductor sector, the annual sales volume of BYD's new energy vehicles was only 179,000 vehicles, and now it has increased by more than 10 times, which has already put great pressure on the output of its semiconductor wafer chip production capacity. If it promotes the listing, there will inevitably be more foreign orders, and BYD Semiconductor will probably lose sight of one thing and the other.
Wang Chuanfu's goal is to increase BYD's monthly sales to more than 340,000 vehicles by 2023. For this reason, he has specially invested a large amount of money to establish brand-new production bases for car gauge chips in Changsha and Jinan, adding production lines and increasing production capacity. According to the new sales target set by Wang Chuanfu for BYD, BYD Semiconductor must at least achieve self-sufficient for its new energy vehicles before it can have free time to go public and export.
BYD Semiconductor's car-level IGBT chip contains a large number of core technologies. After conquering IGBT6.0 version, BYD Semiconductor has already had the strength to compete in the international market. Since there is strength, it is not important listed early or late,What is important is to strengthen technology first and then think about the future.
Figure4: Wangchuanfu, chairman of BYD
In the past ten years, Chinese local enterprises have paid more and more attention to investment in technology research and development, emphasizing "development and scientific research", which is true of HUAWEI and BYD. The rise of technology and self-sufficiency of core components have become the support for local enterprises to straighten their spine. Although the sudden termination of BYD Semiconductor's listing is somewhat regrettable, I believe Wang Chuanfu will make BYD better and better with his own business strategy.
Suspend of BYD Semiconductor Plans, Wangchuanfu, Chairman of BYD Shows Another Marketing Strategy-China.exportsemi.com
