Chinese EV maker BYD sets higher annual sales target, brokerage report shows

BEIJING (Reuters) - Chinese electric automaker BYD aims to sell 4 million vehicles this year, Morgan Stanley said in a report on Monday, suggesting an 11% upward revision to the company's 2024 sales target set earlier this year.

The goal would put BYD almost at par with Ford Motor which ranked sixth by global sales in 2023 with 4.4 million vehicles sold.

BYD attributed the extra sales growth to this year's introduction of new models with its latest plug-in hybrid technology known as DM-i 5.0, which would also contribute a better margin, Morgan Stanley analysts wrote in a report dated Monday, citing comments by BYD executives at a roadshow event.

The order backlog of such models including Qin L and Seal 06 DM-i, both priced from 99,800 yuan ($14,019), has exceeded BYD's production capacity, the report said, adding that BYD showed no intention to hike prices in the rest of the year.

BYD launched the fifth-generation DM-i 5.0 plug-in hybrid technology in May, which improves fuel and cost savings. The world's second largest EV vendor after U.S. rival Tesla touted a record low fuel consumption of 2.9 litres per 100 km (62.1 miles) on depleted batteries with the technology.

It still dominates the segment of EV models priced between 100,000 yuan and 150,000, and the BYD executives expected limited competition from peers such as Xpeng's Mona M03, which is priced from $17,000, according to the report.

The higher sales target implies that BYD, which had its best ever month in August with 373,083 auto sales, would sell around 418,000 vehicles per month in the fourth quarter.

Of that, more than 11% would be sold overseas as the company aims to double exports to 450,000 vehicles this year.

BYD set a 3.6-million-vehicle sales target for 2024, a jump of 20% from its record-breaking sales last year, Reuters reported in March.

The company improved net profit in the second quarter, even though it led a protracted price war with aggressive discounts on its best-selling models.

Under pressure to catch up with rivals in smart driving features, BYD has ramped up its efforts of in-house development of such technologies. The company uses Momenta's system in its Denza cars and Huawei's technology in the Fangchengbao Bao 8 SUV.

($1 = 7.1188 Chinese yuan renminbi)

(Reporting by Qiaoyi Li, Zhang Yan and Kevin Krolicki; Editing by Emelia Sithole-Matarise)