BYD, which is a Chinese technology leader active in solar module, electric vehicles (EVs) and stationary battery production, has published mixed financial results for 2017.
While the firm posted a squeeze on its overall financials, the solar and battery divisions enjoyed a relatively positive year, with revenue increasing 18.85% against 2016 to reach RMB 8,442 million (US$1.34 billion).
BYD stated that it will actively expand its presence in the solar market in 2018. Despite the increased revenues, the solar division is still a loss-maker for BYD due to the “intensified market competition” in the PV space, BYD chairman Wang Chuan-fu said in a statement.
Last year, batteries and PV accounted for 8% of BYD’s total revenue, up from 7% in 2016.
Overall, BYD’s net profit declined by 19.5% in 2017 (down to RMB 4.07 billion) compared to the year prior – a plunge pinned on the scaled-back subsidies for new-energy vehicles (NEVs) in China. This is an industry in which BYD has invested heavily as it looks to take advantage on a growing clamor within China to adopt EVs to tackle the nation’s growing air pollution problem.
“As we are affected by reduction in NEVs subsidies, the profitability of the business, especially for electric buses, has declined substantially so as to bring great pressure to the group’s overall profit,” said Chuan-fu.
First quarter net profit for 2018 is expected to be between 75 – 92% lower than the same period last year following February’s cut by the Chinese finance ministry in support for NEVs. Faced with this new reality, BYD will seek to diversify its business in electric batteries and services throughout the year, the company said.