BYD, electric car producer in China, that is also backed partially by Warren Buffett and Berkshire Hathaway, tells us that the 2012 year on year profit has dropped by more than 94%. This happened because of slow growth in the Republic of China.
This company is currently based out of Shenzhen, a southern boomtown, and they tell us that their net profit from 2012 was 81.3 8 million yuan (which is equivalent to $12.92 million), and this is down from 1.3 8 billion yuan in the year 2012.
One of the Berkshire Hathaway subsidiaries currently owns 9.56% of the company BYD.
“Under the impact of slower economic growth, the automobile industry in the PRC (People’s Republic of China) remains weak,” we learned in the statement.
At the time of this writing, China is currently the biggest automaker in the world and their automobile sales in total rose 4.3% year-over-year in 2012 to 19.31 million automobiles.
Due to domestic economic growth slowing, and limits on car numbers by a few of the cities as well as a political rift between Japan and China which unfortunately put a hurting on sales of these Japanese brand cars and weighed heavily on the market last year.
The overall Chinese economy expanded by 7.8% in the year 2012. That is currently the slowest pace that it’s seen in the last 13 years. This is due to weakness in some of the key overseas markets, as well as further weakness at home.
BYD, a car company that makes hybrid cars, electric cars and conventional cars, only sold a total of 420,000 vehicles in 2012. This is a “slight decrease” from the year 2011, but no comparative figures were given.
“The solar energy business was under great pressure due to the sluggish photovoltaic industry, resulting in considerable adverse effect on the overall results of the group,” added BYD.
The company also produces solar products such as solar panels and solar cells, rechargeable batteries and even telephone handsets.
The solar industry on a global scale has been cut down a notch by the economic slowdown in the United States and Europe, plus there is weak pricing to be blamed on Chinese companies because they’re looking to gain market share by undercutting competitors prices.
Suntech, a Chinese company, once the biggest producer of solar panels, says its main subsidiary is currently facing bankruptcy
On Monday, BYD close-up by 0.47% to 23.51 UN in Shenzhen trading. It shares listed on the Hong Kong market were down .040% to HK $24.85 ($3.23) in late trading on Monday afternoon.