BYD's Washington Reprieve Arrives as China's EV Headwinds Build

BYD shares closed down 2.4% at EUR 8.39 as weak September growth hit Chinese EV makers, though a US Senate delay eased import-ban fears.

A legislative pause in Washington has handed BYD a temporary reprieve from the threat of sweeping US market restrictions, yet the Chinese automaker's shares still finished Friday's European session in the red at EUR 8.39, down 2.4% on the day. The decline came as a broad selloff swept through Chinese electric-vehicle makers, triggered by September growth figures that fell short of expectations for what is traditionally the sector's strongest sales season.

A Cooling Home Front

Growth in BYD's domestic market has been steadily losing momentum. Year-on-year expansion eased to 17% last month, down from 18% in August and 22% in July, according to media reports. Nomura's analysts pinned the slowdown on weaker-than-anticipated domestic demand and a softer order pipeline. The hesitation among Chinese consumers carries outsized weight for manufacturers, since the home market still dictates the bulk of their volumes.

The September sales report, released Thursday, painted a mixed picture. Total deliveries reached 463,561 vehicles, a gain of 16.98% from a year earlier. Passenger car and pickup exports, as reported by Reuters, surged 153.9% to 179,877 units. Over the January-to-September stretch, however, cumulative volume stood at 3,131,576 vehicles — a decline of 4% compared with the same period a year earlier.

JPMorgan Steps to the Sidelines

Caution among institutional observers has been building. On September 29, JPMorgan downgraded the stock from Overweight to Neutral and trimmed its price target to HKD 88 from HKD 124. The analysts cited soft automobile demand in China, rising procurement costs, political uncertainties, and existing trade barriers as reasons for the move.

Investor sentiment in Hong Kong reflected that wariness. Trading there resumed Friday and the local listing gave ground in response to the company's disclosures.

Model Offensive Meets Policy Uncertainty

To counter the market headwinds, BYD is pressing ahead with a refresh of its lineup. On September 28, the manufacturer released official images of the second-generation Seal 07 sedan, designed in both battery-electric and plug-in hybrid variants. Pricing and a launch date were not disclosed.

Meanwhile, the US Senate on Wednesday postponed deliberations on a bill that would permanently ban the import, production, and sale of connected vehicles and related hardware and software with Chinese ties. For Chinese automakers like BYD, the delay amounts to a breather from looming market-access restrictions in the United States — even as the company's expanding overseas deliveries draw heightened scrutiny from foreign regulators and trade officials.

The export boom has become a critical buffer against the persistent weakness at home, where manufacturers are grappling with a bruising price war and reluctant buyers. Yet the stock has absorbed substantial damage: it is down 22% since the start of the year, though it now trades 4.5% above its 52-week low on European exchanges. The tension is clear for investors — overseas expansion opens fresh sales opportunities, while trade-policy decisions in Washington and other economies remain a major source of uncertainty for the business ahead.