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(Bloomberg) — BYD Co.’s shares slumped after steep year-end discounting to meet its 2023 sales goals hurt earnings, despite the Chinese automaker overtaking Tesla Inc. as the world’s top seller of electric cars.
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The EV giant’s Hong Kong-listed shares fell as much 4% as in early trading in Hong Kong on Tuesday, after it reported preliminary 2023 net income of between 29 billion yuan ($4 billion) to 31 billion yuan. While that was a record, it fell short of analyst estimates of 31.5 billion yuan.
Record deliveries in the fourth quarter didn’t translate into another bumper profit. Fourth quarter net income will be between 7.2 billion yuan to 9.2 billion yuan, according to Bloomberg calculations, down from the previous quarter’s 10.9 billion yuan
BYD’s shares have fallen 16% this year.
Like other EV makers, BYD has been hit by a price war in China, the world’s largest auto market. In November, the Shenzhen-based automaker discounted its popular Qin, Han and Tang models by as much as 10,000 yuan in a bid to reach its annual delivery target of 3 million vehicles, which it slightly exceeded.
Geopolitical tensions are also taking a toll. BYD is one of three carmakers selected for further scrutiny in the European Commission’s anti-subsidy investigation to determine whether state support from the Chinese government has given the manufacturers an unfair advantage.
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