Chinese electric vehicle giant BYD has issued a strong statement refuting comparisons to the financially troubled property developer Evergrande. This denial comes after comments made by the head of rival automaker Great Wall Motor, who suggested a potential crisis in the car industry mirroring Evergrande’s financial collapse. For context, in 2021, China’s construction and finance sectors were hit by a significant financial crisis when Evergrande, a major construction company, defaulted on its debt obligations.
In response, BYD firmly stated that such comparisons are without foundation and presented detailed data on its financial health. Their analysis showed that BYD’s asset-liability ratio stands at 70%. The company highlighted that this is significantly lower than that of major global automakers like Ford (84%), General Motors (76%), and even aerospace giant Boeing (102%). Great Wall Motor had previously argued that a higher asset-liability ratio indicates greater financial risk.
Furthermore, BYD pointed out that its total debt of $80 billion is considerably less than that of global giants such as Toyota ($374 billion) and Volkswagen ($471 billion), as well as Ford ($235 billion). Among other Chinese automotive companies, BYD’s total debt is also lower than SAIC’s (which recent reports indicate is significantly lower than the stated $84.5 billion in 2023) and Geely’s (similarly, recent financial data suggests a much lower total debt than the $70 billion mentioned in 2023).
BYD specifically emphasized its interest-bearing debt, which amounts to $3.96 billion. The company underscored that this figure is substantially lower than that of Geely (which current data suggests is also significantly lower than the stated $11.9 billion in 2023), SAIC (again, with more recent data indicating a much lower figure than the $13.1 billion mentioned), Toyota ($249 billion), Ford ($152 billion), and Volkswagen ($138 billion).
BYD’s statement and the presented financial figures aim to demonstrate the robust financial standing of the Chinese electric vehicle manufacturer in comparison to both its domestic and international competitors.