BYD, backed by Warren Buffett, said it expects a more than 300% increase in third-quarter earnings. Despite headwinds including a resurgence of Covid in China, rising material costs and a slowing economy, BYD remained fairly resilient.
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Shares of the Chinese electric car manufacturer BYD rose on Tuesday after the company forecast a huge surge in third-quarter earnings.
Late Monday, the Warren Buffett-backed company said net profit in the three months to September 30 was estimated to be between 5.5 billion yuan and 5.9 billion yuan ($764.5 million to $820 million). dollars), an increase of 333.6% to 365.11% compared to the same period last year.
Shares of Hong Kong-listed BYD rose 5.6% in afternoon trading.
“In the third quarter of 2022, despite the complex and serious economic situation, the spread of the pandemic, extremely high temperatures, high raw material prices and other unfavorable factors, the new energy vehicle industry continued to accelerate its upward trend,” BYD said. in a report.
The company said the sales volume of its new energy vehicles, which include electric cars, “continued to reach record highs”, helping to increase market share and “resulting in a significant improvement in profits and relieving effectively the earnings pressure induced by rising upstream commodity prices.
A number of electric car makers, from Tesla to BYD, have been struggling with the rising cost of raw materialssuch as lithium, which are critical for batteries.
From the start of the year to the end of September, BYD sold 1.18 million new energy vehicles, surpassing Tesla’s figure by just over 900,000 deliveries.
The different BYD models are among the best-selling new energy vehicles in China which is the largest electric car market in the world.
While the Shenzhen-based company has remained fairly resilient in the face of headwinds such as a resurgence of Covid in China and a slowing economy, its smaller rivals have struggled.
In August, Chinese electric car startup Xpeng announced low third quarter vehicle delivery forecast.