BYD’s Split Personality: Record Global Sales Mask a Brutal Domestic Profit Wipeout

BYD is living a double life. In China, the company is bleeding red ink — net profit crashed 55% in the first quarter to just 4.08 billion yuan, the weakest showing since early 2023. Revenue slid 12% to 150.2 billion yuan. Yet beyond its borders, the automaker is hitting milestones it has never reached before, with exports surging to an all-time high of more than 135,000 vehicles in April alone.

The disconnect is stark. On home soil, BYD delivered roughly 314,100 electric and plug-in hybrid vehicles in April — a 15.7% drop year-on-year. Over the first four months of 2026, cumulative sales have fallen 26.4% to just over one million units, marking the longest losing streak in the company’s history. The culprit: Beijing slashed the full purchase-tax exemption for EVs at the start of the year, replacing it with a maximum rebate of 15,000 yuan per vehicle — half the previous level. That pulled demand forward into the fourth quarter of 2025, leaving a gaping hole in early 2026. Rivals Leapmotor and Zeekr have been quick to exploit the vacuum, both posting record deliveries in April.

The margin pressure is relentless. A price war with competitors like Xiaomi and Geely has forced BYD into repeated cuts, which hit a two-year high in March. Profits have now fallen for four consecutive quarters. Financing costs added another 2.1 billion yuan in the first quarter — more than triple the year-ago level, driven largely by currency losses. Operating cashflow plunged 67% to 2.79 billion yuan, and free cashflow over the past twelve months has turned negative despite a book profit of 27.3 billion yuan.

Export Engine Roars to Life

Overseas, the picture could hardly be more different. April’s export record of 135,098 vehicles represented a 70% jump from the same month last year. That brings the year-to-date total to nearly 456,000 units, keeping the full-year target of 1.5 million foreign sales within reach.

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Europe is emerging as the most dynamic growth market. New registrations of BYD electric vehicles in the EU, EFTA, and the UK surged more than 155% year-on-year in the first quarter, according to ACEA data. The company has already started trial production at its Hungarian plant, with series production expected to begin in the second quarter. In a bold political move, BYD has applied for membership in ACEA — the first Chinese automaker to do so. If accepted, it would gain direct access to Brussels debates on emissions standards, charging infrastructure, and crucially, tariff frameworks. Some existing members are reportedly wary, as membership has traditionally required a longer production presence in Europe.

The UK has become a particular bright spot. BYD is now the best-selling EV brand in Britain this year, having delivered nearly 13,000 electric cars and overtaken established rivals such as Tesla and BMW. Its share of the electrified vehicle segment has climbed to almost 10%.

Brazil Breakthrough and Australian Surge

In South America, BYD has achieved something remarkable: it displaced Volkswagen as the leader in overall new vehicle registrations in Brazil. VW has been building cars there since the 1950s; BYD only started passenger car sales in 2021. At the same time, the King hybrid sedan overtook the Toyota Corolla as the country’s best-selling sedan.

Australia is also shifting. The new Sealion 7 was the most sought-after EV on the continent in April, beating the previously dominant Tesla Model Y. To sustain this momentum, BYD’s premium brand Denza plans to build its own fast-charging parks in Australia starting in October.

A Luxury Hedge at Home

Back in China, BYD is trying to defend its margins with a push upmarket. The Great Tang, a seven-seat SUV priced from 250,000 yuan, drew more than 30,000 orders on its first day of sales. Equipped with the latest-generation Blade battery, it promises a range of nearly 1,000 kilometers — a clear signal that the company hasn’t abandoned its premium ambitions even as the mass market comes under siege.

BYD at a turning point? This analysis reveals what investors need to know now.

Analysts see the first-quarter trough as a potential turning point. JPMorgan has raised its price target for BYD’s stock to 120 Hong Kong dollars, expecting sales to pick up from the second quarter onward. Citigroup points to an improving gross margin as a further positive sign.

Until the domestic headwinds ease, exports will remain BYD’s primary growth engine. With more than 450,000 vehicles already shipped abroad by the end of April, the company is betting that its global expansion can more than compensate for the pain at home.

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