Daily Archive: March 13, 2023

BYD signs deal to supply 5,000 EVs to UK car rental firm Octopus EV over 3 years

The initial order will include the Atto 3, which will be available under the Salary Sacrifice program.

BYDDY.US | BYD HK

(Image credit: BYD)

BYD (OTCMKTS: BYDDY), which just last week officially announced its entry into the UK passenger car market, has signed a purchase agreement with a local car rental company.

BYD entered into a partnership with UK-based Octopus Electric Vehicles (Octopus EV) on March 10, which plans to buy 5,000 BYD electric vehicles over the next 3 years, according to a press release today.

The initial order will include the BYD Atto 3, an all-electric C-segment SUV that debuted in the UK this month.

The vehicles will be offered with the Salary Sacrifice program, one of the most affordable ways to lease BYD vehicles in the UK, according to the Chinese new energy vehicle (NEV) maker.

The start of this commercial relationship lays the foundations for Octopus EV to become a BYD partner for the Salary Sacrifice scheme in the UK, with plans for further orders in the future, the release said.

A salary sacrifice program is an agreement to reduce an employee's cash compensation entitlement, usually in exchange for a non-cash benefit.

Founded in 2018, Octopus EV is a subsidiary of Octopus Energy Group, one of Europe's largest renewable energy investors based in the UK.

Octopus EV offers services including electric vehicle leasing, charging post installation, and special discounted tariffs for electric vehicles through its parent company.

On March 8, BYD announced the official start of sales of the Atto 3 in the UK, its first passenger car offered in the country.

The model will start at £36,490 ($43,230) in the UK and local deliveries will begin on March 15, BYD said last week.

The first BYD pioneer stores will open soon, in the backbone of the U.K., including Birmingham, Manchester, Glasgow and Milton Keynes, the company said.

The Atto 3, known in China as the Yuan Plus, went on sale on February 19, 2022, and is the first SUV on BYD's all-electric platform, e-platform 3.0.

BYD to deliver 100,000 EVs to German car rental firm SIXT over next six years

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Gotion’s controlling shareholder to increase stake by up to RMB 300 million

The move is based on Gotion's controlling shareholder's recognition of the company's value and confidence in its continued rapid growth, according to an exchange announcement.

Gotion's controlling shareholder to increase stake by up to RMB 300 million-CnEVPost

The controlling shareholder of Chinese power battery maker Gotion High-tech plans to increase its stake in the company, whose stock has continued to fall over the past few months.

Gotion's controlling shareholder, Nanjing Guoxuan Holding Group, plans to increase its stake in the company by no less than RMB 200 million yuan ($29 million) and no more than 300 million yuan within six months from March 13, according to a Shenzhen Stock Exchange announcement on March 12.

The share purchase plan will not set a price range, and the controlling shareholder of Gotion will increase its shareholding at an opportune time according to the fluctuation of the share price and the overall trend of the capital market, according to the announcement.

The move is based on Nanjing Guoxuan's recognition of Gotion's intrinsic value and investment value and confidence in the company and the continued rapid development of the global lithium battery market, the announcement said.

Prior to the increase, Nanjing Guoxuan held 9.6 percent of Gotion's shares, while its two concert parties, Li Zhen and Li Chen, held 5.81 percent and 1.6 percent of the shares, respectively.

Li Zhen is the chairman of Gotion and holds 80.69 percent of Nanjing Guoxuan's shares, according to data provider Tianyancha. Li Chen is Li Zhen's son, according to Gotion's third-quarter earnings report.

Nanjing Guoxuan and its concert parties together hold 17.01 percent of Gotion's shares and have promised not to reduce their holdings within six months after completing the increase, according to the announcement.

They will execute the plan through the means permitted by the Shenzhen Stock Exchange securities trading system by September 13, according to the announcement.

Gotion ranked fourth with a 3.58 percent share of the power battery installed base in China at 0.78 GWh in February.

While Gotion's share of the China power battery market has remained stable, its shares have continued to fall over the past few months and are currently down more than 40 percent from their recent highs in early July 2022.

Gotion's controlling shareholder to increase stake by up to RMB 300 million-CnEVPost

As of Monday's close, Gotion was down 0.62 percent to RMB 28.92 in Shenzhen.

($1 = RMB 6.9014)

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China’s transition to new emission standard: How will this affect auto market?

Analysts believe the impact of the transition will not last long and will have less of an impact than the last switch in standards in 2019.

China's transition to new emission standard: How will this affect auto market?-CnEVPost

The recent price war in China's auto market has put a new emission standard that will come into effect in a few months' time in the spotlight.

CnEVPost obtained the views of several local analysts, which provide references on what impact that new emission standard will have on the auto industry.

As background, China released its final rule for stage 6 light-duty vehicle emission limits and measurement methods (China 6 standard) in December 2016, a new standard that combines best practices from European and US regulatory requirements.

The standard is being implemented in two phases, with the 6a standard already taking effect on July 1, 2020, and the 6b standard coming into effect on July 1, 2023.

CITIC Securities: Impact will not last long

From July 1, the China 6b standard will be fully implemented, which is more stringent in terms of emission standards and testing criteria compared with China 6a, especially the new RDE test that detects the actual driving emissions of the car, said Yin Xinchi, chief analyst of the auto industry at CITIC Securities, in a research note today.

There are still some old models on the market that do not meet China 6b emission regulations, and the de-stocking of these models may have an impact on the production, sales and prices of the auto industry, according to the note.

However, CITIC Securities also pointed out that the duration of the impact of the transition will not be too long, and the degree of impact will be significantly smaller than the switch of China's auto industry emission standard from China 5 to China 6a in 2019.

China Securities: Essence is the weakening competitiveness of JV brands

China's passenger car market will begin implementing the stricter China 6b emissions standard on July 1, which could exacerbate the pressure to de-stock older models, China Securities automotive industry chief analyst Cheng Siqi's team said in a research report today.

This may intensify the profitability pressure among car companies in the short term, but behind it reflects the further erosion of the competitiveness of second- and third-tier joint venture brands, according to the team.

Against the backdrop of rising market share of local Chinese brands and the ongoing electrification transformation of China's auto market, these joint venture brands have been forced to start cutting prices and de-stocking, the team said.

Huaxi Securities: Several regions have already completed the standard switch

The China 6b emissions standard will go into effect on July 1, and overall, this will have limited material impact on the auto industry, Huaxi Securities analyst Cui Yan's team said in a research note today.

The window for that transition is long, and several regions have already completed the transition ahead of schedule, such as Beijing, Shanghai, Guangzhou and Tianjin, according to the team.

Car companies previously experienced the pain of the transition from China 5 to the China 6a standard and this time are expected to prepare beforehand, the team said.

Inventories in the Chinese auto industry are currently at an above-average level, but the vast majority of inventories have been accrued since April 2022, according to the team.

The team believes the recent wave of price cuts in the Chinese auto industry is largely due to the penetration of new energy vehicles (NEVs) reaching about 30 percent and the willingness and ability of some leading car companies to grab market share.

The China automobile dealers VIA (Vehicle Inventory Alert Index) stood at 58.1 percent in February, up 2.0 percentage points from a year ago but down 3.7 percentage points from January, still sitting above the 50 percent mark, according to China Automobile Dealers Association data released earlier this month The data.

For the VIA, a value below 50 percent is a reasonable range, and a higher reading means lower market demand and greater inventory pressure, according to the index's description.

If you'd like to learn more about the China 6 standard, here's a report from the International Council on Clean Transportation, a nonprofit organization.

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