BYD’s Global Ambitions Face a Dual Squeeze as Profits Crash and Trade Barriers Rise
Published on 06/23/2026 at 15:42 | Redaktion boerse-global.de
BYD’s first-quarter net profit collapsed 55%, dragging its shares to within a whisker of their 52-week low and laying bare the strain on China’s electric-vehicle champion from a vicious domestic price war and a tightening international trade environment. The stock has slumped 23% since the start of the year and now trades at 8.46 euros, barely above the 8.37-euro floor set a day earlier. Over a 12-month horizon, the decline is nearly 39%.
Ironically, the company’s export engine is roaring. In May, overseas sales hit a record of more than 160,000 vehicles – an 80% leap from the same month last year – accounting for 42% of total deliveries. Yet that strength has done little to lift the share price, as investors fixate on the regulatory clouds building in two critical markets: Europe and North America.
The European Commission is reportedly preparing to extend its anti-subsidy tariffs to Chinese plug-in hybrids, according to a Handelsblatt report. That would broaden the trade weapon already trained on battery-electric models since 2024. BYD, along with Chery and SAIC, is said to be on the list of targeted manufacturers, though the Commission declined to comment. The move threatens to block the very export-driven escape route that has powered BYD’s recent volume growth.
Should investors sell immediately? Or is it worth buying BYD?
In response, BYD has signalled a striking shift in strategy. Together with Chery and Geely, it has approached the Canadian government to explore joint ventures for local vehicle production – a direct reversal of its earlier rejection of such partnerships. The calculus is clear: manufacturing in Canada and meeting the USMCA’s 75% North American content threshold would allow tariff-free entry into the U.S. market. The former CAMI plant owned by General Motors in Ingersoll, Ontario, has been discussed as a possible site, though talks remain exploratory. The company is also diversifying beyond cars, supplying battery storage for Chile’s Elena project and planning to start production at its first European passenger-vehicle factory in Hungary in the fourth quarter of 2026.
At home, the picture is darker. BYD sold just 223,000 vehicles in China in May – a 24% year-on-year drop – as price competition erodes margins. The 55% net-profit decline in Q1 reflects that strain. On the technical side, the shares are now 21% below their 200-day moving average of 10.91 euros and more than 40% off the July 2025 peak of 14.80 euros. The relative strength index has fluctuated between 20.8 and 22.2 in recent sessions, deep in oversold territory, but buying interest remains muted.
Investors are demanding concrete catalysts. The stock’s fate hinges on whether Canada’s exploratory talks harden into binding agreements and whether the EU’s hybrid tariff review delivers a formal blow. The Hungarian plant’s ramp-up later this year will provide a first operational test of BYD’s ability to outrun the trade barriers that now encircle its global growth story.
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