BYD (HKG: 1211, OTCMKTS: BYDDY) has been in the spotlight over the past week following comments by the chairman of domestic rival Great Wall Motor (GWM) that sparked discussions about whether it is the "Evergrande of the automotive industry."
Now, Li Yunfei, the brand and public relations head of the new energy-vehicle (NEV) giant, has issued an official response on Weibo, using data and facts to explain why BYD is not as the allegations suggest.
"Recently, many friends have told me they've seen numerous articles, comments, and videos implying that we are the 'Evergrande of the automotive industry,'" Li wrote on Weibo today.
"To be honest, I'm confused -- it's both frustrating and amusing!" Li wrote.
He said it all stemmed from GWM chairman Wei Jianjun's shocking remarks last week: the "Evergrande of the automotive industry" already exists, it just hasn't erupted yet.
As background, 61-year-old Wei made this remark during an interview with Sina Finance last week, sparking speculation that BYD is the "Evergrande of the automotive industry."
Evergrande is one of China's largest real estate developers but is currently embroiled in a debt crisis.
In his Weibo post, Li refuted recent allegations by citing BYD's debt ratio, total liabilities, and payment cycles to suppliers.
BYD's debt ratio is 70 percent, but Ford's is higher at 84 percent, General Motors' is 76 percent, Apple's is 80 percent, Boeing's is 102 percent, Geely's is 68 percent, and Seres' is 76 percent, according to Li.
The company's total liabilities amount to about RMB 580 billion ($80.6 billion), while Toyota's total liabilities are about RMB 2.7 trillion, Volkswagen's are RMB 3.4 trillion, Ford's are RMB 1.7 trillion, Geely's are RMB 504.7 billion, and SAIC's are RMB 610.4 billion.
In terms of interest-bearing liabilities, BYD is significantly lower than its peers.
According to latest annual reports, BYD's interest-bearing debt is RMB 28.6 billion, Geely's is RMB 86 billion, SAIC's is RMB 94.5 billion, Toyota's is RMB 1.8 trillion, Ford's is RMB 1.1 trillion, and Volkswagen's is RMB 1 trillion, according to Li.
In terms of accounts payable to suppliers, BYD has RMB 244 billion, SAIC has RMB 241.1 billion, and Geely has RMB 182.4 billion, as noted by Li.
BYD also has a lower accounts payable-to-revenue ratio than its peers, at 31 percent. By comparison, Geely is at 32 percent, SAIC is at 38 percent, and GWM is at 39 percent.
In terms of payment cycles to suppliers, BYD is 127 days, Geely is also 127 days, GWM is 163 days, and SAIC is 164 days, Li noted.
BYD's revenue for the full year of 2024 was RMB 777.1 billion, net profit was RMB 40.3 billion, R&D expenditure was RMB 54.2 billion, domestic taxes paid were RMB 51 billion, and cash reserves were RMB 154.9 billion. This represents BYD's best operational performance in the past 30 years, Li emphasized.
"Over the past few years, BYD has achieved rapid growth, while some companies have stagnated, with their NEV businesses even lagging severely behind," Li said, implying GWM.
Overall, the asset-liability ratios of China's mainstream automakers are better than those of foreign automakers, he said.
There is no such thing as a "Evergrande of the automotive industry" among China's mainstream automakers, and any remarks undermining China's NEV industry are unacceptable, Li said.
He said BYD has reported evidence and related information to regulators and will pursue legal action against malicious parties.
($1 = RMB 7.1949)
