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BYD Shares Fall After Disappointing Profit Estimate

1 Mins read

Shares of electric vehicle (EV) maker BYD experienced a decline on Tuesday following the release of a lower-than-expected profit forecast for last year. The Chinese company, which is backed by Warren Buffett, anticipates that its 2023 profit will be between 75% and 86% higher than the previous year, despite achieving record sales. However, investors had hoped for an even stronger performance.

BYD surpassed Tesla, the American EV giant led by Elon Musk, in terms of production at the close of 2022. The disappointing profit outlook highlights the intensifying competition among EV manufacturers, especially in China – the largest EV market globally.

Additionally, there are indications that demand may not be growing as robustly as anticipated. On Monday, French automaker Renault cancelled its planned initial public offering of shares in its EV unit named Ampere, citing a slowdown in EV growth in Europe as a contributing factor.

As a result, BYD’s shares fell 4.4% in Hong Kong trading, while its American depositary receipts dropped 5.5% in premarket trading. So far this year, the stock has experienced a 16% decline.

Conversely, Tesla’s shares rose 1.8% in premarket trading, whereas NIO, another Chinese EV manufacturer, experienced a 1.5% drop.

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