China's BYD, which just dethroned Tesla as the leader in fully battery electric vehicles, is showcasing its driver-assist systems and gearing up to announce an expansion into Indonesia. The EV and battery giant also reportedly is in talks with Brazil's Sigma Lithium.
BYD To Unveil Smart Car Tech
The EV giant will tout its advanced driver assistance systems (ADAS) and other smart car tech at Tuesday's ongoing "BYD Dream Day" event.
It unveiled its "Xuanji" smart-car architecture and DLink intelligent cockpit, as well as two-way satellite communications. It's likely that some features will only be available on premium brands like Yangwang to start.
It showed a video of Denza N7 using advanced ADAS on city streets, with N7 owners about to get those capabilities with an over-the-air update.
BYD has not pushed ADAS much until now, but will need to step up if it wants to compete in key market segments.
The vertically integrated company has been doing a lot of in-house R&D but also has a number of driver-assist alliances. BYD recently disclosed that it won regulatory approval in July to test Level 3 ADAS on China's highways. L3 systems are self-driving vehicles under certain conditions, with drivers not expected to immediately be able to take control.
Advanced Level 2 systems are increasingly standard on premium vehicles in China and quickly coming down in the price scale. Leapmotor has launched a Lidar-enabled C10 SUV electric vehicle for roughly $26,000.
If BYD's offerings are well received, it could be a boon for sales and earnings. If they are viewed as lacking, profit margins could come under pressure. So this may be a defining moment for the new EV king.
Given its massive market share in China, BYD ramping up ADAS would greatly accelerate its broad adoption.
That could put further pressure on Tesla's China sales. Tesla still has high brand power in China, but mainstream ADAS in China would undermine a key selling point for the U.S event giant. Tesla announced modest China price cuts on Friday.
BYD unit FinDreams Technology will hold a tech exhibition on Jan. 20, including smart-car tech.
BYD is expected to unveil next-generation battery and hybrid systems within the next several weeks or months.
BYD Indonesia
The EV giant is touting a major announcement with local auto dealer Arista in Indonesia for Jan. 18, signaling that it will enter the world's fourth-most populous country.
A move to begin sales in Indonesia will almost certainly be paired with plans to build an assembly plant in the country. Indonesia adopted rules in December that waive import duties and luxury taxes for EV makers that agree to domestic production.
All of BYD's full assembly plants are in currently in China. But a factory in Thailand will open in a few months, with plants in Brazil and Hungary planned. In addition to Indonesia, BYD has discussed possible operations in Vietnam.
BYD loaded its first car carrier on Monday with nearly 6,000 vehicles heading for Europe. Along with the Thai plant and future ships and plants, it's a big step to ramping up capabilities for overseas sales, which boomed in 2023.
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BYD-Sigma Lithium
BYD and Brazil's Sigma Lithium have held talks ranging from a possible supply deal to a joint venture or outright acquisition, the Financial Times reported Sunday. Alexandre Baldy, BYD's Brazil's chief met with Sigma CEO Ana Cabral Gardner last month.
"Nothing is concrete," Baldy told the FT in an interview.
Volkswagen and Chinese battery giant CATL are reportedly suitors for Sigma Lithium.
SGML stock in February 2023, jumped on reports that Tesla was mulling a bid for Sigma Lithium.
In July, Sigma said it was in talks with possible bidders. In December, Nasdaq-listed Sigma Lithium said planned to list Sigma Brazil on the Nasdaq and Singapore Stock Exchange, "for the purpose of closing the strategic transaction."
BYD has significant lithium investments around the world for its massive battery production, including Chile.
BYD is building an EV plant in Brazil, so securing local lithium could save costs and help meeting sourcing requirements.
Brazil is already a significant overseas market for BYD.
Sigma Lithium just started recording revenue in the third quarter.
Shares plunged since mid-2023 amid tumbling lithium prices, only partially offset by a late 2023 rebound. SGML stock has plunged 16.9% to start 2024, as slowing EV demand continues to weigh on lithium prices.
SGML stock rose modestly early Tuesday.
BYD Earnings
BYD will release preliminary fourth-quarter results before the end of January, possibly this week.
For the full Q4 results, investors will likely have to wait until late March, when BYD reports full-year financials.
BYD Stock
BYD stock edged up 0.9% last week to 27. That came as Tesla stock tumbled 7.8%, breaking below key levels. China EV makers Li Auto, Nio and XPeng also were big losers last week.
BYDDF stock hit a 10-month in December and hasn't made much progress, still below its 50-day and 200-day lines.
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