NBC NEWS
Elon Musk dismissed BYD in 2011 by laughing at their products during a Bloomberg interview.
“Have you seen their car?” Musk quipped. “I don’t think it’s particularly attractive, the technology is not very strong. And BYD as a company has pretty severe problems in their home turf in China. I think their focus is, and rightly should be, on making sure they don’t die in China.”
BYD did not get wiped out. Instead, it dethroned Tesla in the fourth quarter as the top EV maker, selling more battery-powered vehicles than its U.S. rival.
“Their goal was to be China’s largest auto manufacturer and put China manufacturing on the map,” Taylor Ogan, CEO of Snow Bull Capital, said of BYD’s long-standing ambition.
So how did the Chinese company, which began by making phone batteries, become an electric car giant?
BYD’s history
While BYD is now known as an electric car giant, its tentacles stretch into many areas from batteries to mining and semiconductors, which is a large reason behind its success.
Chemist Wang Chuanfu founded BYD in 1995 in the southern Chinese city of Shenzhen, China’s massive tech hub. It was founded with 20 employees and 2.5 million Chinese yuan of capital, or $351,994 at today’s exchange rate.
In 1996, BYD began manufacturing lithium-ion batteries, the type that are in our modern day smartphones. This coincided with the growth of mobile phones. BYD went onto supply its batteries to Motorola and Nokia in 2000 and 2002, respectively, two of the mobile phone industry’s juggernaughts at the time.
In 2002, BYD listed on the Hong Kong Stock Exchange, riding the wave of its success in lithium-ion batteries.
BYD’s pivot to autos
It wasn’t until 2003 that BYD acquired a small automaker called Xi’an Qinchuan Automobile.
Two years later, it launched its first car called the F3, which was a combustion model. And then in 2008, it launched the F3DM, its first foray into electric vehicles. The F3DM was a plug-in hybrid electric vehicle.
That same year Warren Buffett’s Berkshire Hathaway made what was at the time a $230 million investment in BYD.
This gave a boost to BYD’s electric car ambitions.
BYD continued to push into the EV space and this is where its history as a battery maker came into play. In 2020, the company launched the Blade battery, which many argued helped spark BYD’s growth in EVs.
It is an LFP or lithium iron phosphate battery. At the time, according to Ogan, many battery makers were moving away from LFP batteries due to perceptions that they had poor energy density, i.e. they were too heavy for the amount of energy they were able to provide.
But BYD touted the Blade as a breakthrough that provided good energy density and high levels of safety. It committed to putting this in its Han, a sporty sedan which was released in 2020 and seen as a rival to Tesla’s Model S. BYD then put the Blade in subsequent models it released.
