The Rundown - Deep Dive: The Meteoric Rise of BYD

Episode Date: March 30, 2025

BYD has quietly become the world’s top electric vehicle company—outselling Tesla, topping $100B in revenue, and doing it all without selling a single car in the U.S. In this weekend deep dive, we break down how a little-known Chinese battery maker turned into a global auto powerhouse. From government subsidies to battery tech breakthroughs and geopolitical pushback, we explore the forces driving BYD’s rise and the risks that lie ahead.The content of the video is for general and informational purposes only. All views presented in this show reflect the opinions of the guest and the host. You should not take a mention of any asset, be it cryptocurrency or a publicly traded security as a recommendation to buy, sell or hold that cryptocurrency or security. Guests and hosts are not affiliated with or endorsed by Public Holdings or its subsidiaries. You should make your own financial and investment decisions or consult respective professionals. Full disclosures are in the channel description. Learn more at Public.com/disclosures.Past performance is not a guarantee of future results. There is a possibility of loss with any investment. Historical or hypothetical performance results, if mentioned, are presented for illustrative purposes only. Do not infer or assume that any securities, sectors or markets described in the videos were or will be profitable. Any statements of future expectations and other forward-looking statements are strictly based on the current views, opinion, or assumptions of the person presenting them, and should not be taken as an indicator of performance nor should be relied upon as an investment advice.

Welcome to the rundown for another weekend deep dive. Today, we are talking about one of the most important Chinese companies in the world, BYD. You've never heard of them? You're not alone. This little-known Chinese battery maker has become the biggest electric vehicle company on the planet, and it's leaving Tesla in the dust, at least for now. We'll take you through BYD's unlikely rise, the tech and cost advantage is driving its dominance, and why Elon Musk suddenly finds himself playing defense. We'll also look at the geopolitical storm forming around BYD's global expansion from stalled factories to 100% EV tariffs,

and the surprising side hustle that connects the carmaker to Apple's supply chain. We got a great one for you today. Let's dive in. BYD stands for Build Your Dreams, and the company was founded back in 1995. Now, initially the company focused on making rechargeable lithium ion batteries, and they were good at it. They supplied batteries to giants like Motorola and No. Nokia, you know, back when everyone had a flip phone and played snake.

Yeah, to be there. Then in 2003, BYD made a bold move. They bought a struggling Chinese car company. And most people kind of laughed this off, including a young Elon Musk, who literally laughed on camera when asked about BYD. In a 2011 interview with Bloomberg, he mocked BYD when he was asked about them. Take a listen. As you're familiar with, BYD, which is also on the West Coast, I think they're ramping a production

of their electric vehicles. Warren Buffett owns 10% stake in that. Why do you laugh? D is trying to compete. Why do you laugh? Have you seen their car? I have seen their cars. Yes. In fact, at the Berkshire Hathaway meeting, I saw their cars. Yeah. Well, they are on a difference. They're in a difference. Tell me why you're laughing. You don't see them at all as a competitor. No. Well, fast forward to 2024. BYD sold 4.3 million cars. That's up 41% from the year before and basically puts them on par with Ford in terms of volume. BYD's business is booming. They crossed $100 billion in revenue last year.

That's the first time they've topped Tesla since 2018. And they don't plan on slow on down moving forward. They're projecting 5.5 million cars sold this year, which would put them at the halfway mark of catching Toyota, which is the number one car maker in the world. And here's the crazy part. BYD has been able to do all of this without selling cars. cars in the U.S. The U.S. is the second largest auto market in the world behind only China.

And BYD has no plans to sell in the U.S. or Canada anytime soon because of the 100% tariffs on Chinese-made EVs. And they don't really need to because there's clearly enough demand for their cars everywhere else. BYD plans to double its overseas sales to 800,000 units this year. BYD is building momentum across Asia, Australia, and Europe, extending its dominance well beyond China. As part of the expansion, BYD is developing manufacturing plants in its second largest market, Brazil.

And they're also developing one in Thailand, Turkey, and Hungary. Meanwhile, things aren't looking so hot for Tesla. Tesla sales dropped in 2024 and it hasn't been a good start in 2025. Especially in Europe, their sales fell by 47% in February after a 50% drop in January. And this has come at a time where EV sales across Europe actually went up 24%. So the demand for EVs are still there across Europe. These poor sales numbers by Tesla have dinged their stock price, which has lost about a third of its value year to date.

And it probably doesn't help that Elon Musk, their CEO, is shifting his focus to the Department of Government Efficiency, which has prompted someone Wall Street to voice their concerns. So I wonder how Elon feels about BYD these days. He's probably not laughing anymore. So how did BYD pull this off? You know, going from a relatively unknown battery maker to one of the biggest car companies in the world. Well, it all starts with batteries. Remember, that's their origin story. And it's because of that they have one of the best EV batteries in the industry. It's called the blade battery. The blade battery

is cheaper to make. It charges faster and has better safety ratings than most lithium ion batteries. In fact, even Tesla is using these batteries in their Model Y cars that they're making at the Berlin factory. But BYD didn't just stop there. They recently unveiled its super E platform, which is an ultra-fast charging system capable of adding approximately 400 kilometers of range in just five minutes of charging. I mean, that is insane. Just for comparison, Tesla's batteries

can do about 275 kilometers of range in 15 minutes of charging. So this leap in battery tech addresses one of the biggest pain points for EV adoption, charging time and range anxiety. This new battery tech makes charging an EV like filling up a gas tank.

Now, Tesla says they're working on some new battery tech, too. They plan on introducing a 500-kilawatt charger later this year. So we might be in a bit of a technological arms race that could reshape the industry's landscape. All this innovation is great for the EV industry. BYD looks to have the lead right now, but we have to mention BYD's home field advantage. BYD got some serious support from the Chinese government. We're talking like $4.3 billion in subsidies from 2015 to 2020. That helped them scale up big time and undercut the competition on price. But the company is starting to face some challenges. So let's talk about it. B.YD's global expansion isn't all just smooth sailing these days. They're starting to feel the heat from Western

governments. The European Union is investigating BYD's plant in Hungary over concerns that Chinese subsidies are giving them an unfair advantage. If the EU finds anything sketchy, BYD could face significant penalties, including asset divestagers and fines, potentially escalating trade tensions between the EU and China. And China's dominance in the EVs, supply chain, particularly in battery production and critical minerals, has raised alarms in the U.S. and Europe. This dependency carries geopolitical implications, prompting Western nations to come up with strategies to reduce their reliance on Chinese manufacturing and secure their own supply chains. And then to add another layer of complexity, the Chinese government recently delayed the approval

of BYD's proposed plant in Mexico because they were concerned that BYD's technology could leak to the U.S. So this move highlights like the interest. balance between business ambitions and national security considerations in the EV industry. And it looks like BYD seems to be caught in the crossfires. Now, before you wrap up, I need to talk about BYD's side hustles because BYD's business has always extended beyond cars. Right now, autos makes up about 80% of their total revenue. The other 20% comes from batteries and a few other side hustles.

You might be surprised to hear this, but BYD assembles about 30% of Apple's iPads leverage its manufacturing expertise. They started doing this back in 2009, initially focusing on processing components. These days, that's evolved to include the production of structural components and assembly services. I think BID's ability to do all this stuff,

this diversification of skills not only broadens their revenue stream, but it also shows they're able to adapt to the latest technological needs. And I think it's a key reason for BID's innovation and growth. So there you have it, the story of BYD,

how in a short amount of time, they were able to go from a punchline of a joke to one of the most important companies in the world. These days, they're outselling Teslas, expanding globally, building faster, cheaper EVs with better batteries. They seem to have an edge in technology, a cost advantage, but geopolitical headwinds could slow them down. Either way, I think it's time to take BYD seriously.

And one day, who knows, maybe we'll be able to buy a BYD car here in the U.S. Well, all right, guys, that's it for today's weekend. If you guys enjoyed today's show, don't forget to subscribe to the podcast, especially on YouTube or Spotify. We filmed these deep dives with video, and you can watch it on Spotify and YouTube. I highly recommend checking that out. And if you guys have any topics you think we should cover in future deep dive shows, let us know in the comments. Thank you guys again for listening. Shout out to Mike and Connor for all the help behind the scenes.

And we'll see you guys back here on Monday.