Analysis of BYD’s Business Model and Future Development Prospects
This paper uses PEST analysis and SWOT analysis to explore the macro environment and development prospects of BYD in the Chinese market. The study found that BYD has clear advantages in terms of price and business scope, but technological innovation and sales channels are areas that BYD needs to focus on and improve promptly. In addition, the favourable policies for the new energy industry introduced by China in recent years indicate that the macro environment of China at this time is very conducive to BYD’s future growth. BYD’s outstanding strengths and the environment in which it operates indicate that it has a very bright future. Exploring the future of BYD will not only give the public a clearer picture of the company, but can also be used as a reference for investors to help them make further decisions. More importantly, BYD is the industry benchmark for new energy vehicle companies in China. The study of BYD’s future development direction can also provide some guidance and reference to the study of the development of China’s new energy and automotive industries. byd owner's manual.byd user manual,byd maintenance manual,byd service manual,byd repair manual,byd wiring diagrams,byd fault codes.
As the largest developing country, China’s economy has gained momentum in recent years, with GDP reaching RMB 2,493.1 billion in the first quarter of 2021, up 18.3% year-on-year. Against the backdrop of a Chinese economy that is expected to continue to reach new heights, industry insiders are optimistic about the prospect of China’s development. In this context, China is paying more and more attention to the development of new energy vehicles, as evidenced by the gradual strengthening of environmental policies and the introduction of a carbon-neutral perspective in recent years. As a result, new energy vehicles have gradually become the future trend of development of China’s automotive industry, and more and more traditional Chinese car companies have begun to transform themselves from the traditional fuel car market to the new energy vehicle market.
Among them, BYD Co. Ltd. (BYD) can be called the representative enterprise of these transforming car enterprises. In addition, BYD’s research and development in blade batteries have helped it dominate the Chinese new energy vehicle market. At present, the main listed companies in China’s new energy vehicle industry include BYD, GAC Group, Geely and Changan Automobile, and so on. According to the sales volume of Chinese energy vehicle companies in 2020, BYD achieved 183,200 units of sales, becoming the company with the highest sales volume of new energy vehicles in China. Meanwhile, BYD is ranked third among the top 10 global new energy vehicle sellers in 2020 by EV Sales. With such outstanding results, BYD makes one wonder what its future trends and prospects will be.
This paper focuses on BYD’s current business situation, analyses its strengths, weaknesses, potential risks and opportunities through the SWOT and PEST models, and finally predicts the prospect of BYD’s development. SWOT analysis is a widely used tool to provide a systematic approach and support for decisionmaking situations and to analyse the internal and external environment. It analyses an organization’s S (Strengths), W (Weaknesses), O (Opportunities), and T (Threats) by integrating and generalizing internal and external conditions to provide a basis for strategic planning [1-3]. Kotler suggests that external factors can be classified according to their attractiveness and likelihood of success, i.e., opportunities, and severity and the likelihood of occurrence, i.e., threats. Internal factors can be defined in a hierarchy based on their performance and importance [4]. Weihrich proposed the TOWS matrix in 1982 [5]. The purpose of this matrix is to identify the relationship between strengths, weaknesses, opportunities, and threats. In addition, Weihrich also worked out a structure for generating strategies based on these relationships [5]. PEST analysis refers to the analysis of the macro-environment in which a company operates, usually through the four factors P (political), E (environmental), S (social), and T (technological), to analyse the situation faced by the company [6]. The economic aspects include the level of economic development, growth rates, government revenues and expenditures, inflation rates, and so on [7-9]. The political aspect includes the political system, government policies, national industrial policies, relevant laws, and regulations, etc. [10]. Social aspects include population, values, moral level, etc. The technological aspect contains breakthroughs in high technology.
The remainder of the article is organized as follows. The second part of the paper will introduce BYD’s company profile, including its corporate development, main businesses, and key events. The third and fourth parts of the paper will analyse BYD’s strengths and weaknesses, its environment, and the risks and opportunities it is likely to face in the future, using the SWOT and PEST models, respectively. The fifth section will further analyse the prospects of BYD on this basis and make constructive suggestions for BYD’s future development. The final part of the paper will summarize the previous analysis, highlight the paper’s shortcomings, and propose future research plans.
BYD was founded in 1995 and has four major industries - IT, new energy, automotive, and rail transportation. The company employs more than 220,000 people, with approximately 23,000 R&D staff, and has a turnover and market capitalization of over RMB100 billion. According to BYD’s official website, the automotive business is the company’s core business, accounting for 53.64% of revenue in 2020. To date, the company has launched over 50 models, with sales reaching a peak of 520,000 units in 2018. Due to the gradual increase in market competition, BYD’s sales of conventional fuel vehicles have been on a general downward trend from 2014-2019, with a gradual decline in market share. In contrast, BYD’s new energy vehicle sales experienced rapid growth during 2015-2018. This shows that the new energy vehicle is the main direction of the Company’s future strategic development.