BYD Company

The "BYD" name is the pinyin initials of the company's Chinese name Biyadi, which itself was created from company's original trademark Yadi Electronics (亚迪电子, named after the Yadi Road in Dapeng New District, where the company was once based) and the character Bi was just conveniently added to give the company an alphabetical advantage in trade shows. The company later created a backronym slogan, "Build Your Dreams".^[21][22]

BYD was founded on 10 February 1995 with a focus on rechargeable nickel–cadmium (NiCd) batteries. While working as a vice supervisor at the Beijing Nonferrous Research Institute, BYD's founder, Wang Chuanfu, noticed an opportunity presented by the shift in Japanese companies from NiCd to high-value nickel–metal hydride (NiMH) and lithium-ion (Li-ion) batteries. Having identified this market shift in 1993, he moved to Shenzhen with his cousin Lu Xiangyang and founded Shenzhen BYD Battery Company Limited in 1995 to capitalize on the opportunity.^[23] Wang started his business in the back alleys of Buji, a neighbourhood in Shenzhen. Having achieved little success, in 1997 Wang moved his business, also consisting of a battery research institute to Longgang in Shenzhen, where BYD started receiving orders from multinational companies.^[24]

BYD grew its business in its early days by implementing a redesigned manufacturing approach by incorporating more manual labour, in contrast of the capital-intensive and highly automated processes in Japan. This manufacturing process, along with in-house production of key machinery, contributed to a substantial reduction in unit costs compared to Japanese competitors. Despite BYD's nominal productivity being ten times less than Japanese companies, the unit cost of a Japanese battery was five or six times higher.^[25] As the result of its competitiveness, BYD rapidly ascended to become the world's leading NiCd battery manufacturer by July 2002, accounting for 65 percent of global production. Within seven years, the company secured its position as the second-largest producer of NiMH batteries and the third-largest in Li-ion batteries.^[25] By 2012, BYD had captured more than half the world's mobile phone battery market and was the largest Chinese manufacturer (and in the top four globally) of all types of rechargeable batteries.^[26][18]

BYD started producing mobile phone components in the early 2000s. Its electronic business was spun off in 2007 as BYD Electronics.^[27]

In September 2008, MidAmerican Energy Holdings, a subsidiary of Warren Buffett's Berkshire Hathaway Inc, invested about US$230 million for a 9.89%^[28] share of BYD at HK$8/share.^[29] BYD topped the 2010 Bloomberg Businessweek Tech 100 list, a list of large, fast-growing tech companies.^[30]

In 2016, BYD unveiled a working monorail prototype marketed as "Skyrail" (Chinese: 云轨; lit. 'cloud rail')^[31][32][33] and announced they will enter the global rail transit market.^[34] The first public Skyrail line opened as a 9.7 km (6.0 mi) long loop line in Yinchuan's flower expo in 2018.^[35][36]

Due to the slowdown of BYD Auto's sales, between 2017 and 2019, BYD saw its net profit has falling sharply for three consecutive years, especially in 2019 when it dropped to CN¥ 1.6 billion. Wang Chuanfu described it as the "darkest moment", since at that time the company had only one goal, which was to survive.^[37] However, Wang insisted on investing CN¥ 8.4 billion in research and development.^[38] In 2020, BYD received the equivalent of €2.1 billion in Chinese state subsidies.^[39]

In 2002, Wang created a new affiliate to be listed on the Hong Kong Stock Exchange. The initial public offering (IPO) published on 31 July 2002^[40] focused solely on BYD's ambition to become the world's second-largest battery firm, with no mention of venturing into the automobile industry.

In January 2003, Wang made the unexpected decision to acquire Xi'an Qinchuan Auto Company Limited (Qinchuan Auto), despite facing disapproval from the BYD Company's board of directors. At that time, China had 28 car manufacturers, both foreign and local, prompting the government to restrict new entries into the automobile industry unless through the acquisition of an existing player. BYD invested CN¥250 million in Qinchuan Auto, aiming to enter the Chinese automobile industry and securing a license for car manufacturing. However, Qinchuan Auto's technology was outdated, and expansion capacity was limited. BYD responded by constructing a new manufacturing plant in the Xi'an Development Zone within the same province, producing conventional petrol-powered cars.^[41]

Within two years, its first car, the BYD F3 made a debut with production starting in April 2005.^[25] The company produced its first plug-in hybrid vehicle, the BYD F3 DM in 2008, followed by its first production battery electric vehicle, the BYD e6 in 2009.^[42][43] In March 2022, BYD ended the production of pure internal combustion engine vehicles to focus on plug-in electric vehicles.^[44]

Currently, the automotive business constitutes the majority of BYD's revenue. In 2022, BYD reported a revenue of around CN¥324.69 from automotive and related products, a year-on-year increase of 151.78 percent and accounted for 76.57 percent of BYD's total revenue. Additionally, revenue from mobile phone parts, assembly, and other product businesses reached CN¥98.81 billion yuan, marking a 14.3 percent year-on-year increase.^[45]

The company has its corporate headquarters in the Pingshan District, Shenzhen, Guangdong province of China. Its North American headquarters are in Downtown Los Angeles, and BYD has sales offices in various countries.^[46]

BYD Electronics Co., Ltd. (比亚迪电子) manufactures handset components and assembles mobile phones for its customers as an OEM or ODM. Created as a subsidiary of BYD in 2002, it issued an IPO on the Hong Kong Stock Exchange in 2007 having been incorporated in Hong Kong on 14 June 2007.^[47] The company operated several overseas factories,^[48] such as in Cluj, Romania;^[49] a Komárom, Hungary, production base that was acquired through the February 2008 purchase of Mirae Hungary Industrial Manufacturer Ltd;^[49] and a Chennai, India, base, which was also completed in 2008.^[49] In addition, BYD Electronic has production bases in Huizhou, Tianjin, and at Baolong Industrial Park, Longgang District, Shenzhen.^[50] In May 2024, it was announced that BYD Electronic International Co. would be added to Hong Kong’s Hang Seng Index.^[51]

Since 2020, BYD Electronics became one of the original equipment manufacturer (OEM) of Apple's iPad.^[52] It also produces iPads in its factory in Vietnam, which went operational in July 2022. The Vietnamese factory is located at the Phu Ha industrial park in the Phú Thọ province. The first phase of the facility has an annual capacity of 4.32 million tablets and 50 million optical prism products.^[53][54]

In August 2023, BYD has agreed to buy several Chinese factories operated by Jabil, a U.S. manufacturer that supplies major components to Apple.^[55]

BYD Semiconductor Co., Ltd. was established in 2020 as the successor to the BYD IC Design Department that was established in 2002.^[19] manufactures and distributes semiconductor products such as integrated circuits, insulated gate bipolar transistor modules, light emitting diodes, single chips, and other products.^[56] The company planned to issue an initial public offering (IPO) before cancelling it in November 2022 as the company chose to increase investments in wafer production.^[57]

BYD Forklift was established in 2009 and headquartered in Zhenjiang, Shaoguan. It develops and produces electric forklifts with an annual production capacity of 30,000 units. The company marketed its forklifts since 2014.^[58]

FinDreams

Product type	Automotive components
Owner	BYD Company Limited
Country	China
Introduced	March 2020; 4 years ago (2020-03)
Chinese name
Simplified Chinese	弗迪
Hanyu Pinyin	Fúdí

FinDreams (Chinese: 弗迪; pinyin: Fúdí) is the brand name used by four automotive supplier companies owned by BYD. These companies were announced in March 2020 as spin-offs from BYD. The establishment of FinDreams companies was done to grow sales of components to other automotive companies. The companies include FinDreams Battery, FinDreams Powertrain, FinDreams Technology, FinDreams Vision (cancelled),^[59] and FinDreams Precision.^[60][61]

Its Chinese name, 'Fudi' comes from a poem in the Classic of Poetry, which means honesty, trustworthiness, steadfastness and diligence.^[62]

FinDreams Battery Co., Ltd. was registered on 5 May 2019 as a successor to BYD Lithium Battery Co. Ltd., which was established in 1998. Its products include consumer batteries, electronic batteries, electric vehicle batteries and energy storage batteries.^[63] It specializes in lithium iron phosphate (LFP) batteries, including blade battery.^[64] As of November 2021^[update], the company has established 15 major production bases in more than 10 cities across China.^[65] The subsidiary also owns Shenzhen BYD Energy Storage Co., Ltd., (previously Shenzhen Pingshan FinDreams Battery Co., Ltd.) that produces energy storage products.^[66] It produces the BYD Home Energy System, simplified as BYD HES, an integrated product combining solar panels, battery, inverter, etc.^[67][68] This system generated electricity from solar power, and then stored it.^[69] As of December 2023^[update], FinDreams Battery is the world's second largest producer of electric vehicle batteries below CATL.^[70]

In early 2022, the company started construction of a joint venture plant with FAW Group called FAW-FinDreams to produce battery packs. BYD held 51 percent of the shares, while FAW held the rest. Located in Changchun, Jilin, the plant was designed with a total capacity of 45 GWh. The first battery pack rolled off the plant in July 2023, and the plant went operational in September 2023.^[71]

In June 2023, FinDreams Battery established a joint venture with Huaihai Holding Group, which is best known for electric tricycles and electric scooters, intending to establish the world's largest supplier of sodium-ion batteries.^[72] In January 2024, construction of the sodium-ion manufacturing plant was started. The CN¥10 billion (US$1.4 billion) plant will have a 30 GWh annual production capacity.^[73]

In February 2024, the company signed an 8-year agreement with American automotive supply company, BorgWarner. FinDreams Battery will supply BorgWarner with blade cells for manufacturing LFP battery packs in Europe, the Americas and several Asia Pacific regions. BorgWarner will also secure an intellectual property license to use FinDreams battery pack design and manufacturing process.^[74]

In March 2024, FinDreams Battery became a cell supplier to Tesla's energy storage manufacturing in China which operates at the newly built Shanghai Megafactory. It will start supplying 20 percent of the cells needed to produce Tesla's Megapack starting from the first quarter of 2025.^[75]

FinDreams Powertrain Co., Ltd. develops and produces engines and powertrain-related parts such as transmissions, axles, electric car platforms and plug-in hybrid systems.^[19][63]

FinDreams Technology Co., Ltd. develops and produces automotive electronics and chassis-related parts that are used in passenger cars, commercial vehicles, and rail transit.^[63] It has ten major products such as vehicle thermal management, vehicle wiring harness, smart cockpit, advanced driver-assistance system (ADAS), passive safety, braking system, suspension and exhaust, body control, steering system, and body accessories.^[19]

FinDreams Precision Co., Ltd. (previously FinDreams Molding)^[59] operates moulding manufacturing and research and development.^[63]

BYD constructed monorail systems around the world, including the Guang'an Metro and the Guilin Metro in China, Line 17 in São Paulo and the SkyRail Bahia, both in Brazil. BYD is also part of a consortium that was awarded a pre-development contract to build a monorail from the San Fernando Valley to LAX via the Sepulveda Pass in Los Angeles.^[76]

BYD also offers a rubber-tyred tram product, known as "SkyShuttle" (Chinese: 云巴; lit. 'cloud bus').^[77] Bishan rubber-tyred tram in Chongqing is operational.^[78]

In 2021, BYD had 288,000 employees. BYD workforce reached 570,000 employees in 2022, after the company hired 280,000 employees in a single year. At that year, BYD became the privately owned company with the largest workforce in China, and only below several state-owned companies such as China National Petroleum Corporation, State Grid Corporation of China and China Post. By the end of 2023, the company had 703,000 employees, with 133,000 new hires that year.^[20] This workforce count is nearly double that of Toyota, which has 475,000 employees.^[79]

BYD heavily invested in core component development, with a substantial R&D budget and personnel. Founder Securities data reveals that BYD's R&D investment reached CN¥7.99 billion in 2021. The company witnessed a 12.9% rise in R&D personnel, totaling 40,382 in 2021. Notably, BYD achieved a 19.7% year-on-year growth in the number of patents, reaching 29,777 in 2020.^[16] In 2022, BYD invested CN¥18.65 billion billion in R&D, marking a year-on-year surge of 133.44 percent.^[45] In 2023, BYD spent CN¥39.91 billion on R&D which is 6 percent of its operating income.^[80] In 2023, the company recruited 33,000 new R&D personnel, increasing the total number to 102,000. Among these R&D employees, 60% are under the age of 30. Additionally, BYD disclosed in its financial report that the average annual salary for R&D personnel is around CN¥212,000.^[80]

BYD is characterized by its vertical supply chain system, originating as a battery company in 1995 before venturing into cars (via BYD Auto) in 2003. At the time, BYD also leverages China's low labor costs, transforming production lines for power batteries from capital-intensive to labor-intensive, ensuring a competitive edge through a robust supply chain system and reduced production costs.^[81] Post-entry into the automobile industry, BYD developed the entire automotive industry chain, emphasizing core technology research and development. Proficiency in key components, such as batteries, motors, and electronic control was achieved, marked by a large-scale, fully automated production line for batteries.^[16] While BYD's vertical integration bolsters its industrial chain and mitigates challenges such as the global chip shortage, the model poses challenges in adapting swiftly to market changes, influencing the company's gross profit margin.^[16]

BYD diversified into research and development of semiconductor by establishing BYD Semiconductor in 2020. Core components, including automotive chips and the DiLink automotive intelligent system, were independently developed. The establishment of FinDreams companies from December 2019 focused on power batteries, automotive lighting, electronics, powertrain, and moulding.

In early 2020, BYD transitioned its the parts and components division into subsidiary companies, collectively known as FinDreams. This shift enabled independent operations, making component supply to other automotive companies easier.^[16]

BYD has many production bases, including three locations in Shenzhen^[82] (one of which is on the self-titled 'BYD Road' (simplified Chinese: 比亚迪路; traditional Chinese: 比亞迪路; pinyin: Bǐyàdí Lù) in Pingshan District, Shenzhen),^[82] as well as sites in Huizhou,^[82] Shanxi,^[83] and Shanghai.^[83]

Auto production bases include an automobile assembly line in Xi'an, a K9 electric bus manufacturing plant in Dalian,^[84] a photovoltaic module (solar panel) Bloomberg New Energy Finance Tier 1 manufacturing plant in Beijing, an R&D center and nascent automobile assembly line in Shenzhen, and an R&D center in Shanghai.^[40]

US operations can be found in Elk Grove Village, Illinois, and San Francisco, California.^[18] BYD also acquired a site for a future North American headquarters in downtown Los Angeles, and has built and operates a manufacturing plant in Lancaster, California, near Los Angeles.^[85]

In 2019 a bus plant opened in Newmarket, Ontario to handle orders in Canada.^[86][87][88] BYD has three factories in Brazil, the first of which opened in 2015 for the production of electric buses.^[89] In April 2017, it inaugurated its second plant for photovoltaic modules. In 2020, BYD opened its third manufacturing plant in the country in Manaus, specifically for lithium iron phosphate batteries, for use in electric buses.^[90][91] BYD has two electric bus assembly facilities in Europe in Komarom, Hungary and Beauvais, France.^[92] BYD built a new facility in Chongqing, China for producing its blade battery,^[93] which are considered to be the safest EV batteries.^[94] The first plant of the company in India was opened in Chennai.

The company has been recognized for innovation; for example it has developed technologies that allow mobile phone batteries to be made at room temperature rather than in expensive, heated dry rooms.^[95] In 2010, BusinessWeek ranked BYD the eighth most innovative company in the world^[96] and that same year saw Fast Company ranking BYD as the 16th most innovative.^[97] In 2016, BYD won the Zayed Future Energy Prize award for Large Corporations for their development of robust rechargeable batteries.^[98] In 2017, PV Magazine awarded BYD the top category of innovation on its newly launched battery storage system that advances progress in three categories: modularity, charging and discharging capacity, and efficiency.^[99]

In September 2021, BYD appointed Lu Kewen, an online influencer known for spreading antisemitic tropes, as a spokesperson for the company.^[100]

On 5 November 2021, a 36-year-old employee was found dead in a rented home. According to his relatives, his sudden death was due to high-intensity overtime work. However, no autopsy was conducted, so the cause of death remains unclear. BYD agreed to pay the deceased employee's family a lump sum of ¥200,000 RMB in compensation.^[101]

On 27 April 2020, BYD hired attorney Charles Harder and filed a federal civil complaint in U.S. District Court, Southern District of New York,^[102] against Vice Media alleging defamation for a story about BYD using forced Uyghur labor in its supply chain which was published on 11 April 2020.^[87] BYD's case was dismissed with prejudice in March 2021.^[103]

In 2022, the United States Department of Commerce found that BYD had circumvented tariffs on solar panels by routing its operations through Southeast Asian countries.^[104] In August 2023, the U.S. Department of Commerce issued final determination on BYD, determining they circumvented tariffs.^[105]

The National Defense Authorization Act for Fiscal Year 2024 proposed the prohibition of US defense funding for BYD batteries on security grounds.^[106][107]

In addition to patent litigation^[29] Foxconn sued BYD in Hong Kong and Illinois in 2007, alleging BYD poached 50 Foxconn employees and was complicit in the stealing of trade secrets to set up a competing cell phone manufacturing operation.^[108] Court proceedings were brought before BYD Electronic was spun off by BYD later in 2007, delaying the public listing^[109] on the Hong Kong stock exchange by half a year.^[110]

Foxconn^[when?] also opened proceedings in the district where BYD is headquartered, at the Shenzhen Intermediate People's Court,^{[citation needed]} which referred the case to the Supreme People's Court, which in turn commissioned an appraisal by the Beijing JZSC Intellectual Property Forensic Center into files in BYD's possession which were alleged to belong to Foxconn.^{[citation needed]} Eventually^[when?] the Shenzhen court made the final judgment: BYD's files contained non-public information originating from Foxconn, which could bring economic benefits to the holders, thereby, BYD was found guilty of infringing Foxconn's trade secrets.^{[109][additional citation(s) needed]}

Afterwards, Foxconn withdrew the civil proceedings against BYD in mainland China, and sought criminal prosecution instead.^{[citation needed]} On 20 March 2008, the former executive director and Vice President of BYD was arrested.^{[citation needed]} Then on 24 and 31 March 2008 two former employees of Foxconn were arrested and sentenced to 1 year and 4 months, and 4 years in prison respectively.^{[109][additional citation(s) needed]}

BYD issued a counterclaim to Foxconn in Hong Kong court, alleging defamation and bribery of Chinese officials as well as intimidation on Foxconn's part.^[108]

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