(Yicai Global) Feb. 27 -- Chinese auto maker BYD Co. ranked first in global sales of new energy vehicles (NEVs) last year for the third straight year, but the company's net profit saw nearly 20 percent decline, mainly affected by the government's subsidy policy adjustment on purchase of NEVs in the first half of last year.
The company reported operating revenue of CNY105.9 billion (USD16.7 billion), up 2.34 percent from a year earlier and net profit of CNY4.06 billion, down 19.7 percent, in the 2017 preliminary earnings estimate it released yesterday. The company's financial and sales costs had a significant increase due to government's green car subsidies cut in the first half of last year, with operating costs increasing by 3.7 percent, it said.
In addition, intensified competition in the NEV market is also one of the reasons for the decline in BYD's performance. Per the data released by China Association of Automobile Manufacturers, BYD sold a total of 416,000 vehicles last year, including 113,000 NEVs, an increase of 13.4 percent compared to the same period last year, while the total sales of NEVs in the country was 777,000, up 53.3 percent.
This year, BYD aims to speed up launching new products, hoping to achieve the goal of 600,000 vehicles in total sales, including sales of 200,000 NEVs. However, as the central government will further cut subsidies for new energy vehicles this year, many NEV companies including BYD still face pressure.