BYD’s Export Surge Fuels Stock Recovery Amid Domestic Challenges

Investors in BYD found reason for cautious optimism as trading closed in Hong Kong, with the company's shares advancing 3.4% to approximately HK$101.20. This uptick marks a recovery from recent weakness, driven by a complex set of November sales figures that reveal a company at a crossroads. While international shipments are soaring, performance in its home market is faltering, raising questions about the sustainability of its growth trajectory.

The sales data for November, released on Monday, presents a starkly contradictory picture. BYD delivered 480,186 New Energy Vehicles (NEVs) during the month, its strongest monthly performance of 2025. However, this figure represents a concerning year-on-year decline of 5.25%. This contraction extends a trend, marking the third consecutive month of falling sales compared to the prior year.

A breakdown of the segments highlights a significant portfolio shift:

• Battery Electric Vehicles (BEVs): Sales showed robust growth, rising nearly 20% to 237,540 units.
• Plug-in Hybrid Electric Vehicles (PHEVs): This category experienced a sharp drop, falling over 22% to 237,381 vehicles.
• Exports: International shipments exploded, skyrocketing 325.91% to a record 131,935 units for the month.
• Overall Trend: While monthly sales grew 8.7% compared to October, the year-on-year comparison remains negative.

International Expansion Becomes a Critical Pillar

The dramatic surge in exports stands as the unequivocal bright spot in the latest report. By setting a new monthly record of over 131,000 vehicles shipped abroad, BYD demonstrates the efficacy of its global expansion strategy. Cumulative export volume since the start of the year now sits at around 913,000 units, putting the prestigious milestone of one million vehicles sold internationally within close reach.

Should investors sell immediately? Or is it worth buying BYD?

This overseas success is urgently needed to counter mounting headwinds in China. Aggressive competitors, including Geely and Xiaomi, are eroding BYD's market share. The company's portion of the domestic Chinese NEV market has recently contracted from 18% to 14%.

Analyst Caution Persists on Structural Risks

Despite the stock's recovery, analyst sentiment remains guarded. Investment firm Piper Sandler maintains a "Neutral" rating on BYD, cautioning that the company is tracking behind original estimates for the fourth quarter. While a December target of 542,000 units may be achievable due to pull-forward effects ahead of expiring tax exemptions, the outlook for 2026 appears less favorable.

Researchers at the firm label consensus estimates for the coming years as "too high," warning of a risk that the share price could trade sideways or even lower into early 2026. Technological concerns also linger; Piper Sandler notes that BYD's "God's Eye" advanced driver-assistance system collects less than half the driving data of Tesla's Full Self-Driving (FSD) software.

Further clouding the picture are quality control issues. A recent recall of nearly 90,000 vehicles due to battery defects has raised questions about manufacturing consistency. To meet its annual target of 4.6 million units, BYD must now sell approximately 418,000 vehicles in December—a feasible, yet far from guaranteed, undertaking.