BYD Takes Denza into Europe as Battery Shortages and Profit Erosion Cloud the Expansion

BYD launches Denza luxury models in Europe amid production constraints from second-gen Blade battery shortage; exports surge 70% in April while China price war drags global sales, as automaker eyes European factories and leads in energy storage.

The Chinese automaker is making its most aggressive move yet into Europe’s premium segment, launching the Denza Z9GT and Denza D9 on the continent. The luxury brand, positioned to challenge the likes of BMW, Porsche and Mercedes-Benz, represents BYD’s attempt to transform from a volume-driven manufacturer into a globally recognised player with fatter margins. But the rollout comes at a delicate moment: a production bottleneck in the second-generation Blade battery is constraining output across BYD’s entire lineup, including the new Denza models.

The battery supply jam is affecting the Dynasty, Ocean, Denza and Yangwang series, with demand for the ultra-fast-charging cells outstripping capacity. Management expects relief only in the second quarter of 2026, when new production lines come online. Until then, deliveries will inch up gradually. The scale of the demand is evident in the Datang SUV, which racked up roughly 100,000 pre-orders within two weeks of its unveiling.

BYD’s export channel is providing a crucial counterweight to a weak home market. In April, the company shipped more than 135,000 vehicles overseas, a 70 percent jump from a year earlier. That single month’s export volume alone could exceed Tesla’s global deliveries over the same period. Yet total worldwide BYD deliveries fell around 15 percent year-on-year, dragged down by an intense price war in China. The financial toll is stark: first-quarter net profit slumped 55 percent to more than 4 billion yuan, while operating cash flow shrank sharply.

To lift margins, BYD is leaning on pricier models like the Denza pair and the Datang SUV. The Denza Z9GT—a sleek shooting brake—and the D9 premium van are designed to signal that BYD can compete on more than price. Inside the company, Maserati has been described as a particularly appealing acquisition target, underscoring the ambition to build emotional brand appeal alongside technical capability.

Securing European production capacity is central to that strategy. BYD is in talks with Stellantis about taking over underutilised plants in Italy and France. The Cassino factory in Italy saw output plunge 37.4 percent in the first quarter to just 2,916 vehicles, making it a prime candidate for repurposing. Meanwhile, the automaker’s own greenfield plant in Szeged, Hungary, remains on track for completion in 2027 with an annual capacity of 300,000 vehicles. Any additional European factories would shorten supply chains and hedge against potential EU tariffs on Chinese-made EVs.

BYD’s control over battery technology extends beyond cars. In the stationary energy storage market, it overtook Tesla in fiscal 2025, capturing a 13 percent global share against Tesla’s 10 percent. The company delivered more than 60 GWh of storage capacity last year, while the total market swelled to 315 GWh. This second growth engine reinforces BYD’s industrial might, on full display at the Zhengzhou mega-factory. Spanning 10.67 square kilometres, the plant runs at 98 percent automation, with some 1,500 robots assembling a chassis in under a minute.

The home market remains the bedrock. In April, nine of China’s ten best-selling models were electric vehicles, and the EV penetration rate hit 61.4 percent. BYD alone sold 300,222 vehicles in March. Looking ahead, the company has several near-term catalysts: the third-generation Yuan PLUS, equipped with the second-gen Blade battery and a 630-kilometre range, launches on May 21; the same day, Stellantis chief Carlos Filosa unveils his industrial plan, which may contain clues about the factory talks. BYD also targets 20,000 charging stations by end-2026. Its annual shareholder meeting in early June will see votes on a proposed dividend and authorisation to issue new shares. The stock hovers around 100 Hong Kong dollars, with a stubborn resistance at 106 HKD. Investors are also watching oil price volatility and the threat of EU tariffs—two risks that could quickly alter the trajectory of BYD’s European push.