I was visiting a large taxi fleet operator in Southern China as part of a consulting project Momentum Works did for the municipal transportation authorities.
The General Manager showed me their gigantic charging station for electric cars – as part of the government mandate, they have to gradually replace their fossil fuel taxis with electric ones:
BYD’s price surge
Governments across the world seem to be finally giving a strong push (other than subsidies) to the electric cars, but setting timelines where fossil fuel cars are no longer allowed to be sold, or even operate on roads.
In September, when Chinese government expressed that they would be making similar timelines, the stock price of BYD, the leading electric car manufacturer in China, surged:
For a long while, there were numerous criticisms that BYD essentially survived on government subsidies and would not be viable otherwise.
The only reliable player
The truth is, they are moving fast with their own battery technology. Few critiques noticed that, when BYD started in 1995, it was a battery company.
And by 2003 they were the second biggest battery manufacturer in the world. During the same year, they bought an automobile company and started their journey making cars.
The General Manager of the taxi fleet I visited told me that, after evaluating all the electric cars available in the market, “there is no doubt you would buy BYD because they are far ahead of the others. In fact, they are the only reliable player in the domestic market.”
While the whole sector is not yet mature and the costs still too high, he is confident that one day, probably very soon, prices will fall to affordable levels and batteries will be fast charging and long lasting.
Guess who will reap the biggest benefits then?
By the way, the biggest foreign shareholder of BYD is …. Berkshire Hathaway Energy.
Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].