BYD Overtakes FAW-Volkswagen, Becomes China's Top Car Seller for the First Time

After three consecutive years as the top-seller in China’s domestic passenger car market, FAW-Volkswagen has been overtaken by a Chinese automaker.

On January 10, 2023, the China Passenger Car Association released its analysis of the national passenger car market for December 2022, along with the full-year data for China’s automotive market in 2022. The data revealed that the retail sales of narrow-definition passenger cars reached 20.543 million units in 2022, a year-on-year increase of 1.9%.

China Automobile Manufacturers Ranking

In terms of manufacturer rankings, BYD (Build Your Dreams) led the pack with retail sales of 1.805 million units, capturing a market share of 8.8%. FAW-Volkswagen secured the second spot with sales of 1.779 million units and a market share of 8.7%.

Ranking third was Changan Automobile, achieving retail sales of 1.274 million units, a growth of 14.2% compared to the previous year. However, SAIC-Volkswagen slipped to fourth place, selling 1.243 million units throughout the year, marking a decline of 14.7%.

The top ten in sales were: BYD, FAW-Volkswagen, Changan Automobile, SAIC-Volkswagen, Geely, SAIC-GM, GAC Toyota, Dongfeng Nissan, FAW-Toyota, and SAIC-GM Wuling.

In December’s narrow-definition passenger car retail sales ranking, BYD maintained its lead with 224,000 units sold, while FAW-Volkswagen and Changan Automobile followed in the second and third positions.

According to the analysis by the China Passenger Car Association, the consumer confidence of the middle and lower-income first-time buyers, who have been heavily impacted by the pandemic, needs to be boosted. The demand is there but requires policy adjustments to encourage the purchase of energy-efficient vehicles. Striking a balance between economic impact and environmental requirements remains essential.

BYD’s achievement of becoming the top seller in China’s passenger car market is a historic first for the company and for Chinese brands in the domestic automotive market.

On a fundamental level, BYD’s surpassing of FAW-Volkswagen not only ends FAW-Volkswagen’s four-year streak of dominance but also signals a shift in market dynamics. Deeper still, this change highlights Chinese brands, led by BYD, challenging the position of joint venture brands in China’s market and undermining their dominance.

In 2003, BYD acquired Qinchi Automobile in Xi’an, becoming another private car manufacturer following Geely and Chery. At that time, the Chinese automotive market was experiencing rapid growth, yet it was hindered by the dominance of foreign brands.

For private car manufacturers, making a comeback was not easy. They lacked both technology and talent, facing the challenge of being squeezed by joint venture brands. Even the early entrants like Geely and Chery had to navigate the pressures and challenges, whereas BYD, when it announced its entry into the car market, didn’t have lofty ideals; it was merely attracted by the growth potential of the automotive industry.

Later on, BYD set its sights on Toyota’s Corolla model, embarking on a journey of disassembly, learning, imitation, and assembly. In 2005, BYD’s first model, the F3, rolled off the production line, gaining attention from consumers due to its lower price and adept replication.

Byd f3

The F3 became BYD’s flagship model in the era of gasoline-powered cars, but it’s likely the only gasoline-powered model that truly sold well for BYD. After tasting success with the F3, BYD introduced models like the F0, F3R, G3, L3, F6, and M6, achieving sales of 448,000 units in 2009 and becoming the top-selling independent brand. The F3 alone accounted for 291,000 units.

BYD Overtakes FAW-Volkswagen, Becomes China’s Top Car Seller for the First Time
However, gasoline-powered car sales for BYD started declining from 2010 onwards. After launching the Dynasty series with the Qin in 2013, BYD adopted a strategy of coexisting gasoline-powered and new energy vehicles, but gasoline-powered vehicle sales remained lackluster.

In 2018, the Song MAX experienced a brief period of monthly sales exceeding 10,000 units but soon dropped to below 10,000 units by the end of the year.

In November 2019, BYD introduced the gasoline-powered version of the Qin, priced between 64,900 and 81,900 yuan. While it garnered strong attention upon launch, sales remained moderate.

Byd factory

For BYD, the Song Pro, launched in July 2019, was likely its last successful gasoline-powered model, achieving sales exceeding 10,000 units within months and becoming BYD’s only model to sell over 100,000 units annually in 2020.

In September 2020, BYD introduced the Song PLUS, its last gasoline-powered model before discontinuing them. However, its sales performance remained lackluster. It’s safe to say that BYD had reached the end of its gasoline-powered era.

In 2022, BYD made a turnaround through its new energy vehicles, achieving cumulative sales of 1,862,428 units, marking a staggering 155.1% year-on-year growth. This figure includes 11,320 exported units. In December alone, BYD’s new energy passenger car sales reached 234,598 units, a 139.4% increase compared to the same month of the previous year.

Furthermore, BYD’s DM hybrid models (including DM-i and DM-p) achieved cumulative sales of 946,239 units, while the cumulative sales of EV pure electric vehicles reached 911,140 units. The sales of pure electric and hybrid models have nearly equalized.

Looking at BYD’s sub-brands, the BYD Dynasty series achieved cumulative sales of 1,132,064 units in 2022. Among these, the Han series achieved cumulative annual sales of over 274,000 units, with December sales reaching an impressive 30,043 units, marking a new phase for high-end Chinese vehicles.

The medium-to-large SUV Tang achieved cumulative annual sales of 150,832 units, with December sales reaching 20,165 units. The Qin achieved a cumulative annual sales figure of 349,075 units, with 26,206 units sold in December. The A-class SUV Yuan achieved a cumulative annual sales figure of 229,020 units, and 29,468 units were sold in December. The five-seat SUV Song achieved cumulative annual sales of 127,578 units, with 21,102 units sold in December.

The new Ocean web platform also achieved impressive sales, with cumulative sales of 703,621 units in 2022 and 99,370 units sold in December.

BYD Seals

Among these figures, the A0-class two-door Dolphin achieved cumulative sales of 205,417 units in 2022, with 26,074 units sold in December. It remained the best-selling A0-class vehicle for six consecutive months. The all-new pure electric coupe Sea Lion achieved cumulative sales of 51,200 units, with 15,378 units sold in December, marking three consecutive months of sales exceeding 10,000 units and setting a new benchmark for pure electric sports cars.

In a groundbreaking move, Chinese automaker BYD has not only secured a leading position in the mainstream car market but has also established a significant presence in the high-end segment. As of 2022, BYD’s sales figures reflect an impressive shift in the automotive landscape, showcasing the brand’s capacity to redefine the global industry.

BYD’s achievement is underscored by the outstanding performance of its vehicle series. The flagship “Song PLUS” series, with a cumulative annual sale of 365,102 units, has consistently surpassed the 50,000-unit mark in December, maintaining its dominance as the top choice within its segment. This consistent success has allowed BYD to retain its leadership position in the SUV market.

The “DM-i Super Hybrid Destroyer 05” has also made its mark, selling a total of 62,162 units, with 6,107 units sold in December alone. This model’s innovative features and performance have reshaped the landscape of the A+ sedan market. Additionally, the “Super Hybrid SUV Escort 07,” a brand-new five-seater, garnered substantial attention with 1,805 units sold in its inaugural month of December.

BYD conference

Notably, the upscale luxury brand “Tengshi” achieved remarkable results, with a cumulative sale of 9,803 units from October to December. The month of December alone witnessed the sale of 6,002 units, indicating an impressive sequential growth of 73.9%.

BYD has taken a significant step forward in 2023 by unveiling the “Yangwang” high-end automobile brand and the innovative “Easy Four” technology on January 5th. This strategic move showcases BYD’s commitment to revolutionizing the high-end automotive sector.

Wang Chuanfu, Chairman of BYD, emphasized that the concept of a Chinese high-end brand goes beyond mere material aspects. He highlighted how the “Yangwang” brand is set to reshape the global high-end automobile industry.

BYD Overtakes FAW-Volkswagen, Becomes China's Top Car Seller for the First Time

Wang Chuanfu elaborated on the features of the “Yangwang” brand, which will feature the groundbreaking “Easy Four” technology. This dynamic power system, driven by four independent motors, offers precise torque control for each wheel, accompanied by exceptional anti-skid and stability controls. The technology encompasses capabilities such as emergency water crossing, desert maneuvers, and high-traction turns.

Furthermore, the “Yangwang” brand’s vehicles will come equipped with an independently developed 800V SIC silicon carbide electronic control module. This advancement results in a 50% increase in current output capability, a 100% boost in power density, and a 3% improvement in overall vehicle efficiency.

Automotive industry observer Zhao Yongqi expressed that the introduction of the “Yangwang” brand could elevate BYD’s brand awareness further, enabling it to secure a meaningful share in the high-end market. Additionally, the incorporation of advanced technologies positions BYD to disrupt the million-level high-end market.

As the era of securing market share through low prices evolves, the rapid development of new energy sources has positioned Chinese brands as a formidable force in the global automotive industry. The emphasis now lies in solidifying their position in the high-end market.

BYD’s groundbreaking technological advancements mark the initial step in this transformation, making it a pivotal competitive edge for the brand within the realm of new energy vehicles. This strategic progression not only solidifies BYD’s status as an industry leader but also marks a significant milestone for Chinese automotive innovation on a global scale.

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