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China’s internal EV war heats up as officials at BYD, Huawei trade criticisms

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A battle over electric vehicles (EVs) is unfolding in China, with officials at rival brands BYD and Huawei exchanging some verbal barbs. Huawei recently acknowledged the ultra-low prices of BYD’s EVs, insinuating that these low costs come at the expense of other features.

“We are not good at competing with ultra-low prices,” Yu Chengdong, the chairman of Huawei’s smart car unit, reportedly said at a public forum in Shenzhen. “Rather, we are good at competing with value, intelligence, luxury, comfort, safety, high quality, excellent and comfortable user experience.”

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BYD quickly responded to the criticism, challenging Huawei to a direct comparison of their vehicles and going on to suggest a joint showcase of the two companies products. A representative from BYD invited Huawei to present their cars side-by-side, allowing consumers to judge which is superior.

“Personally I have great respect for Huawei,” said Li Yunfei, general manager of branding and public relations at BYD, in a video post on Weibo. “But, I feel that if Mr. Yu can make fewer comparisons, either at press conferences or public forums, more people will like him, and Huawei’s brand would also gain points. We welcome other brands to show their cars at our booth and compete with ours on the same stage.”

In the midst of this corporate skirmish, BYD also took aim at the U.S. and European auto industries. These comments follow the tariff hike imposed by the U.S. on Chinese EVs, raising the duty to 100%. Europe is expected to soon follow suit with its own rate hike. BYD’s top executive argued that these moves stem from fears that Chinese EVs might outperform their Western counterparts.

“There are many examples of politicians in other countries who are worried about EVs in China,” Wang Chuanfu, CEO of BYD, said at a recent industry event. “If you are not strong enough, they will not be afraid of you.”

This exchange comes amid the ongoing price competition among Chinese automakers. The drive to offer the cheapest EVs has led to a reduction in profit margins across the industry. The average profit margin for China’s auto sector has dropped to 5%, the lowest in at least a decade, as domestic brands aggressively vie to outdo each other.

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[JACK AYLMER]

A BATTLE OVER ELECTRIC VEHICLES IS HEATING UP IN CHINA.

THE CEO’S OF RIVAL CHINESE EV BRANDS, BYD AND HUAWEI, EXCHANGING A WAR OF WORDS.

HUAWEI ACKNOWLEDGED THE ULTRA LOW PRICES OF THEIR COMPETITOR-

INSINUATING THAT BYD IS ABLE TO OFFER SUCH CHEAP EVS BECAUSE THEY LACK IN OTHER AREAS.

INCLUDING COMFORT, SAFETY, QUALITY, AND MORE.

BYD QUICKLY HIT BACK AT THE CRITICISM-

CHALLENGING HUAWEI TO PUT THEIR VEHICLES TOE TO TOE WITH THEIR OWN PRODUCTS.

ONE OFFICIAL AT BYD SAID THEY WOULD INVITE HUAWEI TO SHOWCASE THEIR CARS TOGETHER ON THE SAME STAGE-

ALLOWING PEOPLE TO DECIDE FOR THEMSELVES WHICH ONE IS BETTER.

BYD ALSO TOOK A SWING AT THE US AND EUROPEAN AUTO INDUSTRYS-

AS AMERICAN TARIFFS ON CHINESE EVS HAVE ALREADY BEEN RAISED TO 100 PERCENT, WITH EUROPE EXPECTED TO IMPLEMENT A RATE HIKE OF THEIR OWN SOON. 

BYD’S CEO SAYING THESE MOVES WERE MADE OUT OF FEARS THAT CHINESE EVS WILL BE STRONGER THAN WHAT U.S. AND EUROPEAN BRANDS CAN OFFER.

THIS ALL COMES AMID ONGOING COMPETITION OVER EV PRICES BETWEEN CHINESE AUTOMAKERS.

PART OF THE REASON THESE VEHICLES ARE SO CHEAP IN CHINA IS BECAUSE DOMESTIC BRANDS ARE TRYING TO OUTDO EACH OTHER.

AND THAT HAS ACTUALLY HURT THE PROFITS OF CHINESE CAR COMPANIES.

THE AVERAGE PROFIT MARGIN FOR CHINA’S AUTO INDUSTRY SLID TO 5 PERCENT, ITS LOWEST LEVEL IN AT LEAST A DECADE.

AS THE ELECTRIC VEHICLE TRANSITION CONTINUES, COMPANIES AROUND THE WORLD ARE CONSTANTLY SHIFTING STRATEGIES TO KEEP UP WITH THIS EVER EVOLVING LANDSCAPE. 

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