BYD – Next round: major attack on Europe with Bullrun

On 18 October, the Chinese manufacturer BYD is launching the Seal 06 GT, a sporty electric hatchback that impresses with its powerful drive and attractive price. With a size that exceeds the Volkswagen (ETR:VOWG_p) ID.3 GTX, as well as a minimalist, technologically advanced interior, the model is positioned in the upper range of compact electric cars.
 
The engines range from 214 hp to 415 hp, with the most powerful version accelerating from 0 to 100 km/h in just 4.9 seconds and offering a range of up to 605 kilometres. The Seal 06 GT starts at around $21,300, making it significantly cheaper than the Volkswagen ID.3 GTX, which is available from $52,000. And if we assume that the EU levies customs duties of 35.3%, it is still significantly cheaper than the VW at $32,000.
 
Growing acceptance of Chinese cars
 
According to a survey by the ADAC (Allgemeiner Deutscher Automobilclub), almost two-thirds of Germans would now consider buying a car from a Chinese manufacturer. In particular, the low price (83%) and innovative technology (55%) are important selling points.
 
Chinese cars in the evaluation
 
Despite existing concerns such as a limited dealer network or data protection issues, Chinese vehicles perform well in tests. They offer solid battery technology and build quality, although there are still weaknesses in driver assistance systems. The market share of Chinese cars in Europe is growing rapidly, especially in the field of electric vehicles.
 
EU tariffs produce only losers
 
In all the excitement about growing competition from China, some things are being completely overlooked that could cause us serious problems in the future. Tariffs reduce competition. This reduces choice and keeps prices high. Consumers are the losers.
 
In addition, isolation is clearly against open and free trade. This dampens competition and thus the pressure to innovate, which would be urgently needed to be able to sustainably compete against the growing power of China.
 
Let's not forget that the European automotive industry is not only trading in Europe, but above all in the important Chinese market. Without competitive models, the Chinese will not buy European cars.
 
Chinese manufacturers produce up to 30% to 40% cheaper than Europeans. In addition, Chinese manufacturers can fall back on substantial subsidies. A discount battle, which we can expect, will be lost by the Europeans with a bang.
 
It is also forgotten that European manufacturers produce in China and the Chinese will build factories in Europe. So the tariffs will also affect European manufacturers, and the Chinese will probably be able to circumvent them in the long term.
 
The right measures would be strong subsidies and investments in the European charging infrastructure, a clear commitment to digitisation, a drastic reduction in energy costs and an increase in competition, because only in this way can real innovations be achieved, without which the European automotive industry will be the loser.
 
And what does this mean for us as investors?
 
We can either wait like a mouse in front of a snake, or read the market correctly and make wise investment decisions. It's always about timing. Now Chinese stocks are very attractive because they have built rock-solid bottoms.
 

 
BYD has followed our forecast exactly and built a floor within the purple box (please compare our videos on BYD on our YouTube channel). Now the share price is on its way up to the red box between 328.0 HKD and 434.2 HKD. However, this is a minimum target that the share price can significantly exceed.
 
But be careful, the stock is now correcting. Those who are not yet invested should wait for the correction and then buy. This also applies to Xiaomi and probably also to Nio. You can find more information on our website.
 
However, it would be a mistake to believe that European carmakers are doomed. Although the stocks (with one shining exception) are all undergoing severe corrections, these too shall pass. Then these stocks will form bottoms like concrete. We should already know this. Above all, when and where these bottoms are.
 
Only with the right timing and an understanding of the market that goes far beyond that of the press, you are able to make a lot of money in the stock market. With the voucher code LIBERTY you can now get up to 20% discount on each of our analysis packages. This way you will always be one crucial step ahead of the market. Take advantage of our offer.
 
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