Japanese engineers reveal how BYD's internal production of car components and batteries drives its competitive pricing in the EV market.
BYD's internal production strategy
Japanese engineers have uncovered the strategy behind BYD's ability to offer electric cars at highly competitive prices. At a conference organized by the Japanese Economic and Commercial Bureau, more than seventy suppliers from the automotive industry revealed that BYD produces almost all components of its vehicles internally.Disassembly reveals self-reliance
To prove this, Japanese engineers disassembled a BYD Atto 3, the brand's first model introduced in Japan in January 2023, and sold in France starting from 34,990 €. They found that almost no part of the vehicle was purchased from external suppliers.Limited reliance on external suppliers
In reality, BYD turns to external suppliers only for windows and tires, which allows them to eliminate intermediaries and reduce production and assembly costs. BYD is the second largest manufacturer of batteries for electric vehicles, with a market share of 16.4%, just behind its Chinese competitor CATL, which holds 37.1%.Innovative e-Axle system
This figure is crucial for understanding why BYD cars are so competitive in terms of price, the battery representing about a third of the total cost of each vehicle. BYD has developed an innovative system called e-Axle, which combines the motor, inverter, transmission, and power supply into a single component, thus simplifying the manufacturing process and reducing the number of necessary parts.Logistics and manufacturing efficiency
According to UBS, BYD distinguishes itself by manufacturing 75% of its parts internally, compared to 46% for a Tesla Model 3 produced in China. In addition, the Chinese giant excels in logistics management thanks to its own maritime fleet, including the BYD Explorer No. 1, a ship capable of transporting thousands of electric vehicles to Europe.Local production in Europe
BYD has proven that industrial autonomy, covering everything from components to batteries and logistics, is essential for offering affordable and technologically advanced electric cars. This model, still unprecedented among Western and Japanese manufacturers, could revolutionize production and pricing standards at a time when electric mobility is booming. In Europe, BYD has a new strategy to reduce its costs and avoid sanctions against Chinese manufacturers: manufacturing its vehicles locally in its new plant in Hungary, which will soon become BYD's new European headquarters.
