China's BYD reports 632% jump in profits as competitor Tesla falters – Quartz

Electric car manufacturer BYD goes faster than Tesla in terms of profitability. The Chinese company today (April 28) reported a profit of 632% in the first quarter from a year ago. Earlier, the American car company led by Elon Musk announced one of the worst quarters ever.

BYD is the world's largest manufacturer of electric vehicles (membership), although the brand is not recognized outside China. It started out as a battery machine 25 years ago and went over to the automotive industry just over ten years ago, making both conventional fossil fueled cars and "new energy vehicles." The success of its first mass production hybrid captured legendary US investor Warren Buffett, who in 2008 bought a 1[ads1]0% stake in BYD for $ 230 million. That investment seems to really pay off now.

There is increased demand for electric vehicles in China, BYD says, and it expects continued growth. The company's profits increased to around 750 million yuan ($ 111 million) in the first quarter, compared to 102 million yuan a year ago. BYD sold 117,578 new energy vehicles in the quarter, up 5% from a year ago. The company now sells more electric vehicles than conventional cars.

"New energy vehicles are expected to continue to sell well in the second quarter, and the new energy company sales and revenues continue to maintain strong growth," the company's latest stock exchange filing reports. According to Reuters, BYD expects to sell 655,000 cars by 2019, a significant portion of the 1.6 million electric vehicle that China's car dealership expects to be sold this year.

In stark contrast to this positive news for BYD, its US rival Tesla lost nearly $ 700 million in the first quarter. It attributed over $ 120 million in losses to a higher return than expected after raising Model S and Model X prices. In its quarterly earnings call, Tesla, CFO, Zachary Kirkhorn described the first quarter as "one of the most complicated … in the company history. "

Beyond its staggering quarterly surplus, Tesla also had some bad news in China to fight with recently. Last week, a video circulating a lot on Chinese social media showed a parked Tesla Model S suddenly caching four in Shanghai, where the company plans to build its first foreign factory. Earlier this month, a parked Tesla in the United States also fire.

However, the two electric car manufacturers have something in common. Tesla and BYD both plan to expand into each other's markets. China is the world's largest car market, and the United States comes second.

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