BYD: Aggressive expansion in Europe and a focus on price wars
BYD (OTC:BYDDY) is preparing intensively for a price war and for circumventing EU punitive tariffs. With the construction of a production plant in Hungary, the Chinese electric carmaker plans to manufacture models such as the Dolphin and Atto 3 directly in Europe from the end of 2025. This not only ensures shorter supply chains, but also circumvents the punitive tariffs on Chinese electric vehicles. The Atto 2 and the Seagull small car are to follow, enabling BYD to offer a wide range of affordable vehicles for the European market.
At the same time, a leaked email to suppliers indicates a planned reduction in procurement costs. BYD is demanding price reductions of 10% for 2025 to enable competitive vehicle prices. This strategy underscores BYD's goal of securing its market leadership in the ongoing price war. The company has already sold over three million vehicles in 2023, an increase of 61.9% over the previous year.
The stock could be an asset in portfolios
We are consistently pursuing our ‘best of three worlds’ strategy. These are the best stocks from the US, Europe and China. The US stocks were the first to move, now the European stocks are following and the Chinese market is also increasingly bullish.
BYD has undergone a very strong correction at 167.8 HKD and has since returned to a strong uptrend (please see beige arrow at the bottom left of the purple box):
The stock has risen by over 90% from the low of 167.8 HKD to the last high of 320.8 HKD, but has lost over 22% at its peak. Is the stock worth buying now, or will the price fall?
We think that the stock has completed the minor correction within the purple box at 248.4 HKD and has now returned to the uptrend. In the short term, discounts are to be expected. In the worst case, up to 228.0 HKD to 216.2 HKD.
Unfortunately, we can only show a small selection of our extensive work here. You can find an exact and continuous analysis on our website.
Xiaomi (HK:1810): From smartphone giant to electric car challenger
Xiaomi Corp ADR (OTC:XIACY), known as a leading manufacturer in the smartphone segment, is successfully expanding its activities into the automotive market. With the presentation of its electric SUV YU7, the technology group is sending a strong signal. The vehicle, whose design is reminiscent of the Ferrari (NYSE:RACE) Purosangue, is expected to be available from summer 2025 (please see picture above, above the article).
The YU7 impresses with a length of almost five metres, dynamic lines and generous interior dimensions. Although technical details are still pending, the design indicates a premium claim. Following the success of Xiaomi's first electric car, the YU7 could further cement the company's entry into the automotive industry.
And lest we forget: Xiaomi is actually a smartphone maker. Its two latest models, the Redmi K80 and Redmi K80 Pro, already achieved over 660,000 sales 24 hours after the start of sales, and the 1 million mark was passed after just one week. This shows once again that we will have to increasingly reckon with this company in the future.
Is Xiaomi stock also worth it?
Our answer is a definite yes. We believe that Xiaomi is one of the strongest Chinese stocks. The paper has formed two large 1-2 setups in the past (please see beige arrows in the chart). This indicates that the stock needs a lot of room on the upside in the long term to roll out the structures upwards. A momentum consists of five parts. In other words, we are still missing the two strongest and longest waves, namely wave III and wave (III).
In the short term, there is a risk of a sharper price drop to 24.20 HKD to 22.55 HKD. However, we think that the stock is in a stable uptrend with a target above the previous all-time high at 35.90 HKD. But again, we cannot show any details. An exact analysis and ongoing analytical support is available on our website. Our mission: Everyone should be able to reliably build up a fortune. That is what we stand for – day after day.
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