The EV Frontier
BYD is closing the gap on United States firm Tesla as the world's biggest maker of electric vehicles. The rise of the Guangdong-based company comes amid a soaring global takeup of EVs. BYD has recently intensified its focus on Japan, where consumers and manufacturers have been slow to adapt.
Auto industry portal Marklines reports global sales of EVs hit 1.4 million in December last year. That's almost 25 percent of all vehicles sold. China was the biggest market, followed by the US and Germany. In worldwide share, battery-powered vehicles climbed from about 10 percent in 2021 to almost 20 percent in 2023.
Japan is a different story. Sales of electric vehicles last year accounted for less than 2 percent of the market. This is where BYD sees its chance.
BYD vs Tesla
With global sales of almost 1.6 million vehicles last year, BYD looks like it may wrest the number-one ranking from Tesla, which produced about 1.8 million cars. Indeed, in the 4th quarter of 2023, the Chinese maker overtook Tesla for the first time.
From batteries to autos
BYD was established in 1995 as a producer of batteries for smartphones and laptops. It became one of the world's biggest EV battery makers before it started building cars. The company also manufactures hybrids.
BYD in Japan
BYD exports its cars to over 70 countries, where they are sold through local affiliates. Starting from January 2023, however, Japan became the first country where BYD has direct management operations. The company reports it has secured about 1500 orders.
A Japanese customer who recently switched from a domestic hybrid to a BYD says he believes batteries are the heart of an electric vehicle, explaining he chose the Chinese brand because unlike Japanese carmakers, BYD produces its own batteries in-house. He also said he chose BYD because it is the only foreign EV maker in Japan with dealerships that provide a satisfactory level of service.
Plans for 100 outlets
Tofukuji Atsuki, president of BYD Auto Japan, says the firm plans to open 100 outlets across the country by the end of 2025. Tofukuji says in-person dealerships are especially important in Japan, even as more automakers turn to selling their cars online.
Tofukuji says about 90 percent of Japanese owners drive domestic brand cars. Customers are accustomed to high-quality, personalized service, even after making their purchase, whether it's fixing small dents or asking for assistance in operating new functions in their cars. So, in order to encourage Japanese consumers to make the switch, he wants BYD to provide the same level of attention.
Tofukuji points out Japan is the fourth-largest car market in the world and highly competitive, with 11 automakers operating in the country. He suggests that by setting up a wholly owned office, BYD is taking a long view on gathering all kinds of information about the auto industry, and what drivers want. He says the Japanese office will provide input for product development back home.
Establishing dealerships is not the only way BYD hopes to woo Japanese customers, who are seen as some of the world's most picky. Its offerings include features unavailable on other vehicles. For example, BYD cars sold in Japan were the first vehicles equipped with devices to prevent drivers from mistaking the accelerator for the brake. This came amid a rise in accidents mainly involving elderly drivers mixing up the two pedals.
Experts say although BYD may not sell too many cars right away, the move will reward the firm eventually. He says the Japanese market is very established, with highly demanding customers, and if the company can be successful here, it can gain invaluable experience for other countries.
Tofukuji says the firm plans to be in Japan for the long term. He wants BYD to be in the best position when the EV market finally takes off.
