BYD Auto Analysis: 3Cs, Business Model Canvas, Value Proposition Canvas, SWOT, 7Ps, Porter’s Five Forces, STEEPLE

A quick review of BYD Auto, focussing on EVs, using a number of frameworks.

BYD is a Chinese conglomerate manufacturing company founded in 1995. They have two divisions, BYD Auto and BYD Electronics. While they produce ICE vehicles, their emphasis is on electric vehicles (EVs). They are the world’s largest electric vehicle (BEV + PHEV) manufacturer and one of the world’s largest battery manufacturers.

Tesla was the first household EV name, and has become famous worldwide. It is the largest BEV manufacturer, and the second-largest EV manufacturer (BEVs + PHEVs) behind BYD.

Traditional automakers from the USA, Europe, and Asia have, especially since circa 2020, started moving into the EV space, including Ford, Volkswagen, and Hyundai/Kia. Outside of the Chinese market, many of these currently outcompete BYD.

After the Chinese Communist Party introduced several EV subsidies and grants, hundreds of automakers entered the scene, although these have since consolidated into a handful of large brands. BYD produces many of the top-selling EV models in China.

EVs have moved from the early adopter stage to the early majority stage in many developed countries. However, given EVs are still more expensive than ICE vehicles, BYD’s customer are typically more financially well-off than the average citizen. They serve markets across every continent excluding Antarctica, and continue to expand rapidly, although ~70% of their revenues still come from the Chinese market.

For commercial vehicles, BYD provides buses to transit authorities and organisations across Asia, Latin America, and Europe. Significant sales have been to Brazil, Colombia, and Singapore.

  • Individuals, typically middle-income
  • Fleets
  • Governments
  • Transit organisations
  • Mid-price EVs
  • Environmental sustainability
  • Online
  • Company retail stores
  • Online account management
  • Brand community and social media
  • Vehicle sales
  • Maintenance
  • Charging networks
  • Tech/engineering talent
  • Capital
  • Materials
  • R&D
  • Manufacturing
  • Supply chain/distribution
  • Marketing/sales
  • Material suppliers
  • Charging networks
  • Dealerships
  • R&D
  • Manufacturing
  • Materials
  • Marketing
  • Affordable personal transport
  • Tech features
  • Environmental sustainability
  • Convenience
  • Cost savings
  • Tech experience
  • Reduced environmental impact
  • Range anxiety
  • Charging access
  • High upfront cost
  • Long range EVs
  • Fast charging network
  • Over-the-air updates
  • Strong position in Chinese EV market
  • Vertical integration with battery production reduces supply chain risks and increases flexibility
  • Earlier focus on EVs vs competitors has led to manufacturing expertise and scale
  • Charging network infrastructure with hundreds of thousands of EVCPs
  • Less brand recognition outside China
  • Lagging autonomous driving technology
  • No established distribution in many markets
  • Growing global EV adoption, particularly at the non-premium price range
  • Expanding charging networks
  • Advancing battery technology capabilities
  • Competition from established automakers
  • Potential battery supply constraints
  • Trade tensions between China and other markets
  • Reduced government EV subsidies long-term
  • Various EV models, including cars, buses, and trucks
  • Mostly mid-range, with some low-range offerings and high-range concepts
  • Digital marketing
  • Experiential events to promote tech image
  • Online and physical dealerships
  • Tech-savvy salespeople with deep product knowledge
  • Online purchase process
  • Test drives
  • Retail stores for service and demonstrations
  • Test drives

Many major automakers are competing for EV market share, although BYD are currently growing at a faster rate than competitors.

High barriers to entry but new EV startups are emerging, especially in China (although this has been tempered in recent years due to government regulation).

Other transport options like public transport and e-bikes/e-scooters can substitute in certain situations, but personal transport is still popular and EV sales are increasing.

Individual consumers don’t have much power, but large fleet and government buyers have more influence, in particular with commercial vehicles.

BYD are highly vertically integrated, so require less on third party suppliers than competitors. Many commodity components reduces supplier power.

  • Increasing environmental awareness driving demand for EVs
  • Technology-laden EVs can be seen as “cool”, “sexy”
  • Advances in battery tech enabling longer range EVs
  • More technology integrated into vehicles, especially EVs, such as driver assists and infotainment
  • Rising incomes in China allowing more consumers to afford EVs
  • Economic difficulties globally reducing spending on luxury and non-essential goods such as EVs
  • EVs don’t rely on fossil fuels and the related environmental impacts of both sourcing and burning them
  • EVs help reduce air pollution through zero tailpipe emissions
  • Government subsidies and regulations favouring EVs in many countries
  • EVs being used as a political tool in democracies for gaining votes (either pro- or anti-EV)
  • Emissions and fuel economy regulations on automakers
  • Upcoming bans on petrol and diesel vehicles
  • Perception of EVs as more ethical/sustainable than fossil fuel-powered vehicles
  • Ethical concerns with supply chains, such as child labour cobalt mining in DRC for batteries and claims of forced Uighar labour for vehicle manufacturing