BYD profits fell sharply in the first quarter of 2026 overall. Revenue declined 12 percent year on year during the period. Slower domestic sales in China drove much of the downturn. BYD has recorded its steepest quarterly profit decline since 2020, underlining the mounting pressure facing the world’s largest electric vehicle seller in its home market despite success abroad. The company’s latest report showed that net profit in the first quarter of 2026 declined by 55.4 percent from the previous year, falling to 4.09 billion yuan, approximately $597 million. Revenue dropped by nearly 12 percent to 150.2 billion yuan ($22 million), the third consecutive quarterly decline and the lowest quarterly revenue figure since Q2 2024. However, the result still bested analysts’ prediction that revenue would be around 132-140 billion yuan. BYD sold 700,463 “New Energy Vehicle” (EVs and PHEVS) units in the quarter, down 30% year-on-year and nearly 48% below the record volumes of Q4 2025. Read: China Told Automakers To Stop Cutting Prices, BYD Just Made It Worse The Chinese market for electric cars is fiercely competitive. BYD has taken over as the market leader because of its low-priced models, yet price wars in its home market are intense. Meanwhile, the government has scaled back subsidies. China exempted NEVs from purchase tax entirely in 2024–2025, but for 2026 and 2027, the relief has been halved to a maximum of 15,000 yuan per vehicle. This policy shift pulled demand forward into Q4 2025, exacerbating the Q1 2026 slowdown. Sales in China have declined for several consecutive months, and profits are being squeezed even as exports grow strongly. Global Push Becomes Critical As Domestic Sales Cool BYD is looking to the overseas market as domestic sales decline. It plans to ship more than 1.5 million automobiles this year in an attempt to overcome sluggish domestic sales. Industry insiders expect massive export growth next year, but overall delivery growth will probably be less aggressive. This strategic shift was on display at the Beijing Auto Show, where BYD launched new products targeting the premium segment, including the Datang (Great Tang), a full-size electric SUV priced from 250,000 yuan, which attracted more than 30,000 pre-orders on its first day. Moving beyond low-end models is intended to help the company sustain profitability amid the mass-market price war. There’s a renewed focus on regaining technological superiority, too. The company is enhancing charging speed, among other features, to attract consumers who are not keen on switching from gas-powered cars. But BYD is at a crossroads as it stands. Its expansion across borders may be the answer to whether it can bounce back. Analysts say the next few quarters will be critical, with domestic EV demand recovery and robust export growth seen as the keys to a profit rebound.
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