BYD position on the cusp of the Solstice 2025

BYD is very unlikely to go bust, but it is definitely facing significant financial pressure within China’s fierce EV market.

Here’s what’s happening:

🔍 Liquidity crunch and aggressive pricing

1. A Financial Times analysis flagged BYD as having the deepest working‑capital deficit among major Chinese carmakers—approximately ¥125.4 billion—due to intense discounting, postponed supplier payments, and heavy production .
2. This follows a broader “rat‑race” price war in the Chinese auto sector. BYD, along with Geely and others, has slashed prices dramatically—some models by 10–30%, even up to 34% on certain flagship cars .
3. The Chinese government has stepped in, enforcing a 60‑day payment cap to suppliers to shore up supply‑chain stability .

🏛️ Sector-wide pressure—not just BYD

1. Over a third of publicly traded Chinese automakers had more current liabilities than assets by the end of 2024. BYD is just the most visible example .
2. Analysts warn an “industry‑wide elimination phase” could occur by 2026, weeding out those unable to weather liquidity shocks .

🚘 Dealership shake‑out

1. Independent BYD dealership groups like Qiancheng in Shandong and Xingqi in Liaoning recently collapsed, straining warranty and after‑sales services .
2. BYD is working to support affected customers, although they argue these are separate owner‑operated dealers, not BYD‑owned outlets .

🛡️ Is BYD going bust?

Highly unlikely, for several reasons:

1. BYD has massive scale, strong vertical integration, and control over batteries—being China’s second-largest battery maker after CATL .
2. They outperformed Tesla in Europe recently and achieved record sales of 4.27 million vehicles in 2024, with strong margins and global growth .
3. Despite off‑balance sheet strain, BYD has low conventional debt, relying instead on working capital financing, which is stressful but not unmanageable .
4. Publicly, BYD leadership has rejected comparisons to Evergrande, with a 70% D/A ratio and ¥580 billion debt stack they say is justified and comparably healthy like Ford or Toyota .

✅ Bottom line

1. BYD is in the eye of a financial storm, cut-throat price competition, and dealership instability.
2. BUT it is far from bankruptcy. With its scale, backing, and global performance, it looks more like it’s navigating a tough consolidation phase.
3. Industry analysts forecast that weaker peers will fall, while strong players like BYD, Li Auto, and Xpeng likely consolidate market position by 2026 .

So no, BYD is not going bust—but its model is being severely tested.

Service me, please: Your Car!

Service me, please: Your Car!

Trust this: cars are getting more and more complex. Maintain them with basic care, and both you and your car, and your pocket, will benefit.

 

Regular servicing is cost-effective compared to most repairs. Can you also afford to compromise your quality of life and that of your family?

 

The cost of a car service can vary depending on the type of service (some oil changes for example are rather cheap), the vehicle, and your choice of garage. MyCarPal can help you find the best service for your needs.

 

But listen to this...

If your vehicle breaks down far from home and requires a recovery truck, that alone can cost you £50, £100, or even £150 or more, depending on the distance and the type of failure. Are you starting to see the point? Then you still must get it repaired, all because of a lack of basic maintenance.

Ask your mechanic to include a standard health check while your car is in for service (a quick once-over) and record it on video. It's called a "See it Now"! There should be no extra charge, or it will be very minimal.

If you're unsure about a repair list, ask for a video that includes your car's registration plate and even the chassis number. The video should be unedited and done in one take so nothing can be hidden or taken out. We at MyCarPal always recommend these, unless you completely trust your Mechanic. 

 

Small problems turn into BIG problems...

 

Consequential £Cost: 

Regular car maintenance is essential for keeping your vehicle running smoothly and efficiently. Neglecting these tasks can lead to costly repairs and decreased performance. Here are some of the potential consequences:

• Engine problems: Oil sludge buildup can clog oil channels and restrict lubrication to the turbocharger, leading to engine wear and even failure. Coolant issues can cause the engine to overheat or freeze, while poor air filtration can introduce dirt and debris into the engine, damaging sensitive components. Always use fully synthetic oil. 
• Reduced fuel efficiency: A poorly maintained engine will work harder, consuming more fuel and increasing your expenses at the pump.
• Diesel Particulate Filter (DPF) issues: This is basically a filter that is part of your exhaust system, to reduce dangerous poison gasses going into the air we breathe. In diesel vehicles, DPFs can become clogged with soot, leading to reduced engine performance and even engine slowdown (limp mode).
• Catalytic Converter (CAT) problems: In petrol vehicles, the CAT can become clogged, reducing engine efficiency and increasing, again, dangerous emissions.
• Increased risk of breakdowns: Regular maintenance allows your mechanic to identify and address potential problems before they become major issues, reducing the risk of unexpected breakdowns.

NOTE:

Particulate (dangerous gasses we breathe in) sensors (very clever sensors) are being placed on the roadside and can see exhaust gasses. It’ll then take your reg number and you’ll be fined.

 

 

Reliability:

 

It's important to be able to get to work, important appointments, or to take a loved one somewhere important. You never know when you might need your car in an emergency. It’ll always be ready when you need it, if you look after it.

 

Fuel efficiency:

• A properly in tune car can use less fuel, saving you money at the pump.
• Poor tyres on your car is like riding a bike with really soft tyres. You'd use a lot more energy to move and be very soon out of breath. The same is true for your car; poor tyres will decrease fuel efficiency and therefore increase the cost at the pump. Poor tyres, and pressures, can also be dangerous.

Engine Problems:

Engine problems, such as poor spark plugs causing misfires or running too rich, can cause unburned fuel to enter the exhaust, which can damage the catalyst. This can cost over £1000 to replace, not including labour (which is not cheap). Some catalysts are also physically difficult to replace then require a computer to install them into the engine's electronic control unit (ECU).

 

Safety:

Regular maintenance helps ensure that your car is in good working order, which can help prevent accidents. For example, worn brakes and tires can significantly increase the risk of an accident. Your brake pads and discs could be wafer thin or even corroded, which can drastically reduce braking effectiveness.

If your car caused an accident due to lack of maintenance, could you live with that?

 

Resale value:

• A car that has been well-maintained is worth more money when you sell it.
• Potential buyers are less likely to pay a good price for a car that hasn't been well-maintained.
• Would you buy a car that hadn't been serviced or looked after? It's doubtful, so being hypocritical might come to mind.

 

Environment:

Increased emissions: When a car is not properly maintained, it can run less efficiently, which means it will burn more fuel.

This leads to increased emissions of harmful pollutants into the atmosphere, such as carbon dioxide, nitrogen oxides, and hydrocarbons. These pollutants contribute to climate change, air pollution, and respiratory problems.

 

Oil/Fluid leaks and spills: Leaky fluids from a poorly maintained car can contaminate soil and water, harming wildlife and ecosystems, including the water we drink.

 

Tips:

• Budget and save for your car service and repair. Even a small amount, like £10 per month, can add up to £120 per year, which can cover a basic service. You do this for your holidays, weekends away, your latest phone, and your watch, your clothes. You know where this is going...
• If you buy a used car, especially privately, get it serviced regardless. This will give you peace of mind and allow your mechanic to give it a once-over as soon as possible.

 

Maintain your car, keep it in shape, and it won't let you down.

Anything to add? Leave a comment...