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BYD shares plummet as profit-slip hints at further downturnBYD Co. shares sink as Wang Chuanfu warns of brutal EV knockout stage, with profit and margins falling, China sales weakening, and reliance on exports rising.By CNBCTV18.com March 30, 2026, 7:52:38 AM IST (Published)3 Min ReadShares of BYD Co. plummeted after the company's earnings fell short of forecasts and Chairman Wang Chuanfu issued a dire warning about the future of China's electric vehicle sector.

On Monday, the stock began trading 4.6% lower in Hong Kong.

According to a Bloomberg report, Wang stated that the rivalry "has reached a fever pitch and is undergoing a brutal 'knockout stage" in a letter to shareholders on Friday. The automaker's fourth-quarter net income dropped 38% to 9.3 billion yuan ($1.3 billion) and revenue dropped roughly 14% to 237.7 billion yuan, both of which fell short of analyst projections, prompting the pessimistic evaluation.

Despite outselling Tesla Inc. worldwide, BYD's fourth-quarter profitability reduction was sharper than anticipated, capping a year in which the business suffered its first annual profit decline in four years and its weakest revenue rise in six.

As it struggles with decreasing domestic sales, the Chinese car giant's rise to global dominance is being put to the test. The industry bellwether is being forced to make significant investments to keep up with the introduction of tech-centric vehicles by companies like Xiaomi Corp.

While revenue increased 3.5% to 804 billion yuan in 2025, BYD's profit dropped 19% to 32.6 billion yuan. Its widely regarded that gross margin dropped from 19.4% in 2024 to a three-year low of 17.7%.

There hasn't been a finer start to the year. After controlling the Chinese market for years, BYD has recently lost the top rank to Geely Automobile Holdings Ltd. due to a decline in sales during the first two months of this year.

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Because of this, BYD is looking more and more overseas, where demand for its models is high and the automaker makes more money on each sale.

In contrast to the decline in domestic sales, exports have remained steady thus far in 2026. BYD hopes to sell 1.3 million cars outside of China in 2026. However, the EV brand is investing heavily in the construction of plants abroad in order to get around tariffs and other trade restrictions, making it a costly and risky endeavour.

Citigroup Inc. predicted that BYD's car sales in China will become unprofitable in the first quarter due to inflation driving up expenses, forcing the company to rely solely on exports to generate revenue in its primary auto sector.

Early indications suggest that BYD and other Chinese EV manufacturers are profiting from the subsequent spike in crude oil prices, even though automakers have not yet released their sales numbers for March, the first full month since the Persian Gulf crisis started.

With a few notable outliers, like Japan, EV adoption rates have been increasing throughout Asia even before the oil shock of the Iran War. More than half of all cars sold in China are EVs or plug-in hybrids because of the government's efforts to foster the development of a domestic alternative energy sector.Continue Reading(Edited by : Juviraj Anchil)TagsBYD Autoelectric cars