• 55 mins Gold Miners Brace For Seasonal Downturn
  • 8 hours The Silver Plunge Continues
  • 24 hours 7 COVID Vaccine Stocks To Plan Upside Moves
  • 1 day Rhodium Climbs Reaches Record Highs
  • 2 days Tesla Tumbles After Battery Day Fails To Impress
  • 2 days Three Energy ETFs To Watch This Decade
  • 3 days What To Do With $2 Trillion In Suspicious Bank Transactions?
  • 4 days How The Stock Market Predicts Electoral Victory
  • 4 days Tesla's "Battery Day" Could Deal A Blow To Cobalt Miners
  • 5 days New TikTok Deal Hopes To Bypass National Security Concerns
  • 5 days Where Will Gold Go From Here?
  • 6 days COVID-19 Is Fueling A Pastic Waste Crisis
  • 6 days Gold Output Set To Decline
  • 7 days Uber And Lyft Look To Go Electric
  • 8 days COVID-19 Is Crushing Palladium Demand
  • 9 days This ‘Once-Boring’ Tech Company Is Now Super Hot
  • 10 days Will Air-Based Protein Be Our Future Food?
  • 10 days Google Pledges To Go Carbon-Free By 2030
  • 11 days A New Twist In The TikTok Saga
  • 11 days Gold Inches Closer To $2,000
Britain Crosses Key Energy Landmark

Britain Crosses Key Energy Landmark

Britain is about to pass…

Short Sellers Are Piling Into Oil

Short Sellers Are Piling Into Oil

Short sellers have added more…

Three Energy Casualties In The Coronavirus Crisis

Three Energy Casualties In The Coronavirus Crisis

Energy markets are reeling from…

Irina Slav

Irina Slav

Oilprice.com

Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.

Contact Author

  1. Home
  2. Commodities
  3. Energy

China’s EV Industry Is Booming

EV

A Chinese electric vehicle maker, BYD, is attracting a lot of positive sentiment from analysts covering the company, according to a Bloomberg poll among 27 analysts. A total 18 of these have a “buy” stance on the company despite it losing US$3 billion in market cap because of lower government subsidies and intensified competition from foreign manufacturers.

The revision in the subsidy regime for electric vehicles hurt the company badly. BYD recently said its first-quarter income would be a staggering 92 percent lower than in the previous quarter because of the lower subsidies. Yet the company will later benefit from higher subsidies that Beijing will continue providing for longer-range electric vehicles.

Speaking of long-range electric vehicles, BYD is one of the Chinese companies driving a potentially major decline in diesel fuel demand in China with their fast-growing electric bus fleet. This fleet could displace almost 280,000 bpd in fuel demand.

Bloomberg reported today that electric bus fleets across Chinese cities are expanding at the rate of 9,500 every five weeks. Last year, 99 percent of all electric buses in the world—some 380,000 of them—were in China. BYD’s electric bus production to date is 35,000, but it now has the capacity to roll out 15,000 annually. Related: China’s $33 Trillion Finance Industry Opens To Foreign Investment

Foreign competition is not a cause for concern for BYD, according to the analysts Bloomberg polled, even from Tesla or Nissan, which produces the most-sold electric car, the Nissan Leaf. In fact, Bloomberg estimates that BYD’s earnings per share this year will jump by 32 percent, which will outperform the rest of the sector in the country. For the Chinese EV industry as a whole, Bloomberg has estimated EPS growth at 29 percent.

China is pushing electric vehicle adoption urgently as part of efforts to deal with pollution. Beijing has a target of a sevenfold increase in the sales of the so-called new energy vehicles and is considering a ban on gas guzzlers. Still, the subsidies for new energy vehicles are planned to be phased out by 2020, which means that local and international EV makers have less than three years to find ways to survive on their own without subsidies.

By Irina Slav for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment