#BYD

Daimler’s R&D chief Thomas Weber told Germany’s Wirtschaftswoche a big secret: Daimler will show an electric car at the Beijing auto show that opens in the last week of April. Of course, TTAC readers already knew the secret. But it is always nice to have independent verification.

Real Chinese brands are losing market share to joint ventures. The Chinese government wants to keep up appearances, and strongly suggests to joint ventures with foreigners that they should start a separate “Chinese” brand. Latest to say “hao” (yes, ok, jawohl) is Daimler. Its joint venture with BYD to make electric cars in China will dispense with making electric Mercedes first and will instead immediately head to second base and launch a Chinese brand.

Everybody in the business knows that the BYD S6 SUV is a blatant copy of the last generation Lexus RX350 SUV. The rip-off is so blatant that BYD even registered a European patent for their carbon copy. If you don’t look close enough, pretty much the only parts that differ are the grille and some BYD badges. Mei wen ti! No problem!

If you’ve followed TTAC for the last several, you’ve been able to watch the meteoric rise of Build Your Dreams from humble upstart to Buffett-backed behemoth. Two years ago, BYD seemed poised to launch an unstoppable onslaught of cheap Chinese electric cars that seemed like an attractive proposition at a time when gas price angst was everywhere. Today, however, things have changed considerably. Bloomberg reports that BYD has opened its US headquarters in Los Angeles, a year behind schedule, and with fewer jobs than initially promised. And no wonder: for all intents and purposes, BYD has practically abandoned its charge to leverage its cell phone battery know-how into electric car dominance. According to Bloomberg, BYD

“has delayed plans to sell electric cars to retail buyers, citing limited availability of public chargers. Instead, it’s focusing on solar panels, batteries, LED lighting and rechargeable buses.”

Employees of Saab will soon collect unemployment benefits from the Swedish government instead from Victor Muller. They can find solace in the fact that they are not alone. It looks like former media darling and wunderkind BYD is hitting the skids.

Except here, people are not kept around for months doing nothing . They are fired. This is China, not socialist Sweden. According to Chinacartimes, BYD announced that it will cut up to 1,800 members of staff, including underemployed 1,000 members of its sales team.

After a lot of prototypes presented at Chinese car shows with hoods closed and long cables going to mock charging stations, EV development appears to get serious in China. Yesterday, Nissan announced that it is developing an EV for the Chinese market that will be sold under the Venucia brand by 2015. Daimler of all people could be further ahead.

This is the BYD F0. I’ll leave it to the experts which other car this resembles. It reminds me a bit of that car, but maybe only because it’s so small and red. It should be red. It’s embarrassing.

BYD made a big splash a few years back when it became the first Chinese automaker to develop a highway-capable plug-in vehicle. That announcement brought a flurry of publicity and a Warren Buffett investment in the firm, but has yet to translate into real plugin sales success. Now, BYD is making a big splash again, by announcing another first for a Chinese automaker: an in-house, stratified-injection, all-aluminum turbocharged engine with a dual-clutch transmission. The 1.5 liter engine creates 178 lb-ft of torque from 1750-3500 RPMs, according to a BYD release, putting “[power] equivalent to a 2.4 liter gasoline engine” through “an advanced 6-Speed Tiptronic dual-clutch design” transmission. BYD insists that the drivetrain’s technology was developed in-house, but some may point to the firm’s ties to VW as a source of the know-how in China’s first modern engine.

Why does Warren Buffett have a headache? For quite a while, China’s BYD had been nothing but a miracle. Now, the Buffett-backed wunderkind turns outcast. To move their cars, BYD slashes prices down to the bone.

Yesterday night, I skyped with Ash Sutcliffe of Chinacartimes, and he kvetched that TTAC doesn’t give him enough “link love”. I pride myself in the knowledge of esoteric ways of showing affection, but link love? Would it have something to do with chains? Finally, it dawned on me that I make link love to Ash by topping his URL with TTAC’s high traffic words. And there is no better moment than this. Ash found the first real review of a real BYD plug in hybrid, performed by a real, card-carrying member of the press. My link love goes out to you for this, Ash!

Troubled BYD has even more problems: Dealers defect the Chinese car maker, because the alleged master of the electric vehicle has perfected one ancient tradecraft: The art of channel stuffing. A Beijing BYD store switched to another brand because BYD required them to carry a whopping six times the monthly selling rate on the lot. The poor dealer that moved 70 BYDs in a good month was sitting on a steadily restocked inventory of 400 units.

Even that generous inventory strategy did not help:

BYD had a bit of a rough time lately. This might cheer them up: According to a report by the Wall Street Journal, a joint design team of BYD and Daimler has finished the styling of an all-electric battery car that will be launched by a BYD/Daimler ( or “Benz” as they call them in China) joint venture.

And here another BYD first: BYD is the first Chinese company to perform a massive dealer cull. “BYD has admitted its sales network grew too fast and has cut the number of dealerships by 100,” reports People’s Daily.

We have covered the Governator wooing not-so-gloriously-doing BYD to come to California, well, at least with a headquarter building. We were also interested to hear that BYD “is in talks with officials in Los Angeles to supply all-electric battery buses in the city.”

The Wall Street Journal revisited old investigative reporting glory and did some thorough digging into the matter. And here is what transpired, all as per the WSJ:

China’s BYD needs good news real bad. The Chinese market for EVs is … what Chinese market for EVs? And wasn’t their E6 coming to the U.S.? Whatever happened to that? That’s what we get from investors brought to California by the Governator. Oh well, Jerry Brown instead. In the meantime (as in “mean”), Nissan delivers its first real Leaf to California man. BYD will sink into irrelevance, unless they come up with something, fast.

Suddenly, they have a swell idea. Something way bigger than cars.