Goldman Sachs released a research report stating that the European Union announced tariffs on imported electric automobiles from China, which is expected to be implemented from July 4. BYD Company Limited (01211.HK), Geely Automobile Holdings Limited (00175.HK) and SAIC Motor Corporation's products will each be subject to tariffs of 17.4%, 20%, and 38.1%, respectively. It is said that the relevant companies have already received a proposed increase in tariffs.

The bank estimates that the tariffs will have a negative impact of 2% and 6% on BYD's net profit in 2021 and 2022, respectively, and a negative impact of 11% and 21% on SAIC's net profit in 2021 and 2022, respectively. However, Goldman Sachs pointed out that the actual situation has not been determined until July 4th, and automobile companies may take measures, including adjusting the selling prices of overseas market products, and producing in overseas factories. For example, BYD's Hungary factory can be put into operation as early as the second half of this year, and the potential impact is still controllable.

Considering the recent progress of BYD's Hungary factory, the bank reiterated its 'buy' rating on BYD and set a target price of 295 yuan.