---
title: "BYD's Wang Chuanfu: The automotive industry has entered the elimination round, and the industry's window of opportunity is only 3-5 years."
type: "News"
locale: "zh-HK"
url: "https://longbridge.com/zh-HK/news/89776422.md"
description: "Wang Chuanfu pointed out that in the period of intensified competition, companies must have three abilities to win: core technology, precise strategic direction, and fast decision-making mechanism. He believes that BYD is in the best period in the company's history and is confident in gaining a higher market share in the next three to five years. He frankly stated that battery energy density is no longer customers' top priority, and safety and cost-effectiveness are the correct direction to compete."
datetime: "2023-06-08T16:57:52.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/89776422.md)
  - [en](https://longbridge.com/en/news/89776422.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/89776422.md)
---

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# BYD's Wang Chuanfu: The automotive industry has entered the elimination round, and the industry's window of opportunity is only 3-5 years.

On Thursday, June 8th, BYD held its 2022 annual shareholder meeting. When talking about the current intense competition in the new energy vehicle industry, Chairman Wang Chuanfu said that the automotive industry has entered the elimination phase, and the industry's opportunity window is only three to five years.

He mentioned that compared with the previous years when new energy vehicles were in short supply, it is obvious that the market has entered a period of oversupply this year. During this period, the industry will see survival of the fittest, or elimination, as competition is necessary for prosperity.

He believes that the new energy vehicle industry will undergo a major transformation in the next three to five years, and the speed of change is accelerating, often exceeding expectations. In a period of intensified competition, companies must have three abilities to win:

> "First, they must have core technology." The transformation of new energy vehicles is essentially a technological revolution, with internal combustion engines and engines being replaced by electromagnetic, motor, and electronic control technologies. Only companies with core technology can survive in the elimination phase. If they only do simple assembly and assembly, the probability of survival is very small.
> 
> "Second, they must have precise strategic direction." The industry's opportunity window is only 3-5 years, and the choice of models and technology routes is crucial. They cannot go the wrong way and waste time, otherwise they will not only lose money but also be left behind by competitors. Only with strategic leadership and accurate direction for each route can they survive in competition with their competitors.
> 
> "Third, they must have a fast decision-making mechanism." They must accurately find direction in the rapidly changing market. Car companies are often large in size, and decision-making mechanisms are lengthy, but the new energy vehicle market is a battlefield. In the later stages of the revolution, predictability is very low, and some car companies may collapse. After a long decision-making process, they may face major problems.
> 
> According to a report by 21st Century Business Herald, Wang Chuanfu said, "A fast decision-making mechanism is one of BYD's important advantages. Currently, BYD's core decision-making layer is the founding team. We are personally involved and will complete the revolution no matter how hard it is. We will personally command and participate in major decision-making judgments, and then fully authorize them after the revolution period is over."

Wang Chuanfu said, "BYD is in its best period in history in terms of both capital and talent reserves." The most difficult period has passed, and they have entered a strategic opportunity period. BYD will use its existing advantages in the industrial chain, cost, technology, and products to further optimize its brand image and lead China's new energy vehicles to the world. "We are confident that we will gain a higher market share in the next three to five years."

According to another report by National Business Daily, BYD's cumulative sales in 2022 reached 1,868,543 units, a year-on-year increase of 152.5%, once again winning the global new energy vehicle sales championship, and has been the top-selling new energy vehicle in China for ten consecutive years. The company's goal is to become China's largest car manufacturer by the end of this year. BYD's sales target for this year is to start at 3 million vehicles and strive for double growth to 3.6 million vehicles.

In May of this year, BYD's sales reached 240,220 units, a record high for the month, an increase of 109.4% YoY. From January to May, the cumulative sales exceeded one million vehicles, reaching 1,002,591 units, an increase of 97.63% YoY, which is equivalent to the sales in the first five months of this year exceeding 50% of last year's total sales.

From January to April this year, among the top ten groups of new energy vehicle sales, BYD ranked first with a 34.3% market share, followed by Tesla with a market share of 13.7%. Last year, BYD's market share of new energy vehicles was 27%, an increase of nearly 10 percentage points YoY.

Wang Chuanfu also mentioned that BYD has been vigorously expanding production capacity in various regions since last year, and has basically solved the problem of supply and demand balance. Currently, the company's production capacity and various component outputs can meet future market demand. At the same time, the company has made sufficient preparations to meet the growing demand of overseas markets in the future.

The media also noticed that the day before the shareholders' meeting, BYD publicly stated that it will launch a new brand with high professionalism and personalization in 2023. This is also the promise made by Wang Chuanfu at the BYD 3 million new energy vehicle offline release conference in November last year. It is expected that this new brand, with the internal code name "F brand", will be named on June 9th, and it is widely believed in the industry to be "Formula Leopard".

This brand will focus on new energy vehicle models with multiple varieties and uniqueness, covering styles such as sports cars, off-road vehicles, and coupes. It is positioned between BYD and Tengshi, and its first product may be positioned as a "hardcore off-road vehicle", equipped with BYD's new hybrid power system, with a comprehensive range of up to 1,200 kilometers, and overall performance comparable to the Mercedes-Benz G-Class, aiming at Great Wall's tank brand, and is expected to be unveiled this year with an estimated price between 400,000 and 600,000 yuan.

In addition, according to the summary of Economic Observer's on-site report, Wang Chuanfu also mentioned at the annual shareholders' meeting that the current market demand for batteries has changed, and energy density is no longer customers' first demand. With the popularization of charging stations and the reduction of mileage anxiety, the most important indicator for general economic cars may be battery safety and cost-effectiveness:

 The appearance and interior design of "Reuters" circulated on the Internet, with internal mechanical buttons.

> "A range of 400 to 500 kilometers is a turning point in the market demand for electric vehicles. Consumers are becoming more rational and objective in their requirements for energy density and range. Whoever can provide safer batteries and better cost-effectiveness may be on the right track in the future."

Wang Chuanfu further explained that "the first half of new energy vehicles is electrification, and the second half is intelligence." He believes that unmanned driving is not the core definition of intelligence. Due to the unclear issue of accident liability for unmanned driving, a safety accident could ruin the entire market space for a vehicle model. Therefore, advanced driver assistance is the mainstream path that can form a commercial closed loop.

BYD will highly coordinate the development of power batteries and energy storage batteries in the future, forming a larger business space. Regarding the development of its newly controlled subsidiary, Yian Insurance, BYD will use its large user base and accumulated technology and sales experience to empower the new energy vehicle insurance industry in terms of cost savings and scientific claims.

Regarding the view that "the automotive industry has entered an elimination race," according to the Shanghai Securities News, Zeng Qinghong, Chairman and Party Secretary of Guangzhou Automobile Group, also made similar remarks at the 2023 China Automotive Chongqing Forum, stating that "the current Chinese automobile industry is at the most critical historical node, and the automobile industry is bidding farewell to the golden age of high growth, and the elimination race is accelerating."

He proposed five major industry trends:

> Bid farewell to the golden age of high growth, and the market will present a long-term and fierce competitive situation;
> 
> The elimination race in the auto market is accelerating, and some international and domestic brands will struggle to survive;
> 
> Domestic brands will comprehensively grasp the discourse power of mainstream price range electric vehicles and "big three electric";
> 
> Intelligent driving and artificial intelligence are iterating rapidly, and rebotaxi may have explosive growth in the future;
> 
> OEMs are transforming into data and software companies, and R&D and services based on customer experience will become core capabilities.

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