Why is BYD's production capacity insufficient?

[MacAdrian]

BYD's insufficient production capacity is due to issues with blade batteries and inadequate production capabilities. Here is relevant information about BYD: 1. Brand history: BYD Company Limited was founded in 1995, starting with a team of over 20 people. By 2003, it had grown into the world's second-largest rechargeable battery manufacturer and established BYD Auto in the same year. Originating as a battery manufacturer, BYD initially played the role of an "outsider" in automobile manufacturing. It gained a first-mover advantage over other newcomers by leveraging its "independent intellectual property rights" and the acquisition of Qinchuan Auto. 2. Brand introduction: BYD Auto adheres to a development path of independent R&D, production, and branding, committed to creating truly affordable and high-quality vehicles for the people. The product designs incorporate both advanced international trends and align with Chinese cultural aesthetics.

[SanBethany]

Recently, BYD's new energy vehicles have been selling like hotcakes, with many people switching to electric cars. Demand has surged with the support of national subsidy policies, leading to long queues for orders. A friend of mine ordered one and had to wait almost three months to get the car, only to find out that the factory's production capacity couldn't keep up. The existing production lines are running at full capacity, and plans to build new factories to expand production are underway, but site selection, approval, and construction take time. Hiring workers has also been challenging due to a shortage of skilled labor. Additionally, the previous pandemic delayed some progress, and inventory can't keep up with the consumption boom. This isn't just BYD's problem; the entire industry is feeling the impact of the demand surge. It's estimated that the situation won't ease until new production capacity comes online next year. Hopefully, they can optimize production management to speed up deliveries.

[AllieMarie]

I think the main reason for BYD's insufficient production capacity is the bottleneck in the supply chain. The global shortage of automotive chips has had a significant impact, as BYD relies on imported parts for some components, leading to production line stoppages due to shortages or skyrocketing prices. Raw materials like lithium and cobalt used in batteries are also in tight supply, with increasing transportation delays. Their original intention was to localize the supply chain to reduce risks, but restructuring requires capital and time, making it difficult to show results in the short term. Production line efficiency has been noticeably affected, with significant daily fluctuations in output at times. Countermeasures include diversifying suppliers and improving inventory management, but the high uncertainty in the external environment means recovery will require collaboration.

[OVivienne]

BYD's electric vehicle sales are exploding, with everyone rushing to buy, and government subsidies adding fuel to the fire. What about production? Factories are already operating at full capacity, working overtime. However, expanding production capacity and building new factories is not something that can be done overnight—approval and construction cycles are long. There's also a shortage of workers, and the difficulty in recruiting skilled workers is affecting production schedules. The pandemic disrupted plans in recent years, and now orders are piling up, making it hard to keep up. This issue reflects the lag in production in the era of fast consumption. Hopefully, BYD can accelerate adjustments to reduce waiting times for consumers.