Recently, a leaked email from China's largest electric car manufacturer BYD requested suppliers to reduce prices by 10%. In response, the company clarified that annual negotiations with suppliers are an industry practice, and the proposed price reduction target is not mandatory but open to negotiation.

As BYD became the world's first auto manufacturer to reach the milestone of producing 10 million new energy vehicles, on November 26th, a leaked email titled "BYD's Request to Reduce Costs for Passenger Vehicles by 2025" surfaced. The email screenshot revealed that BYD demanded an undisclosed supplier to lower product prices by 10% starting January 1, 2025.

BYD has requested suppliers to accept price reductions next year, indicating that this Chinese electric car manufacturer is preparing for intensifying price wars within the world's largest auto market.

Additionally, there is another leaked email circulating online that appears to be a supplier's response to BYD. The email stated that they received BYD's notice to further reduce costs by 10% starting 2025 but expressed strong dissatisfaction and protest, urging BYD as an industry leader to focus on long-term development rather than short-term gains through relentless pressure. They called for promoting a healthy supply chain and fostering a fair, sustainable cooperative environment.

Li Yunfei, BYD's Director of Public Relations and Brand, responded on Weibo saying, "Annual negotiations with suppliers are an automotive industry norm. Based on large-scale procurement, we propose price reduction targets to suppliers, which are not mandatory but subject to negotiation."

This email indicates that BYD is preparing for further price discounts next year. The price war in the Chinese auto market over the past two years has led to industry consolidation and pushed some small companies to the brink of bankruptcy.

To leverage China's expertise in the electric car sector, some Western auto manufacturers like Volkswagen Group and Stellantis NV have partnered with Chinese brands such as XPeng Motors and Lixiang Automotive. At the same time, luxury electric car brands like HiPhi and Shanghai-based WM Motor are deeply involved in bankruptcy proceedings.

BYD has shown strong performance amidst this market turmoil, further solidifying its position. Earlier this year, BYD led a new round of industry price cuts, successfully expanding market share and squeezing out competitors.

BYD continues to achieve record high revenue and profits. In the most recent quarter, its revenue surpassed Tesla for the first time, and its gross margin also rose to 21.9%, hitting a new high in a year.

This year, BYD has become the best-selling auto brand in China, selling a total of approximately 3.2 million plug-in hybrid and electric vehicles, with October's monthly sales exceeding 0.5 million vehicles, setting a new record. It is expected that by the end of the year, BYD's sales will reach at least 4 million vehicles.