Not every sales stories from China is a rosy one. Private Chinese automaker, BYD, which is partly owned by Warren Buffettâ€s Berkshire Hathaway, is seeing sales slump.
After it almost doubled in 2009, BYD’s sales rose by just 17% in 2010, way behind the 32% industry average. For the first half of 2011, sales have dropped 20% year-on-year to 242,419 units, according to JD Power.
In the midst of this, sales Vice President, Xia Zhibing, has resigned. Xiaâ€s departure is officially listed as for “personal reasons†in the company statement, but industry observers and analysts believe the real cause behind his resignation is the companyâ€s sharp sales decline this year. Xia, 37, has been the sales chief since 2005.
Analysts point out that the governmentâ€s scrapping of tax incentives for small cars has resulted in a drop in demand for models from mass-market brands this year. However, BYD’s sales are falling faster than the industry at large. Also blamed is BYDâ€s aggressive dealership network expansion over the past two years. It backfired in 2010 when more than 20% of its dealerships closed, according to local media.
Or could it be BYDâ€s model line-up itself? The company has plenty of models that are “inspired†by other marques – Estima, Honda City, Merc SL, Megane CC, Altis, Optra 5, you name it. Could it be that the average Chinese is no longer digging “imitation†products when it comes to cars?