In a recent announcement set to shake up the rapidly growing electric vehicle industry, Toyota and BYD have announced they’re joining forces. We all know Toyota as a highly successful Japanese car manufacture, but you may not know as much about BYD (Build Your Dreams). Let’s have a look at who the players are, and how the new deal works.
Who are BYD?
BYD are a Chinese battery manufacture who have turned their hand to a wide range of energy solutions in recent years, including electric vehicles. While they made their mark with batteries, BYD now dominates the worldwide market for battery electric and plug-in hybrid vehicles. Since 2015, BYD have ranked number one in the global market.
In the first quarter of 2019 alone, BYD have made a profit of around AU $155 million. This is more than seven times what they earned in the same quarter for 2018, which shows a company on the rise.
How Does the Toyota and BYD Electric Vehicle Deal Work?
Toyota and BYD will be joining forces to develop battery electric vehicles, as well as batteries for other vehicles. The initial target is to produce a series of sedans and low-floor SUVs which will be hitting the market between 2020 and 2025. The new battery electric vehicles will be released and sold under the Toyota brand name.
One reason this deal looks to be so profitable is the sheer size of the Chinese electric vehicle market. In a bid to take action on climate change, Chinese governments have placed license plate quotas on standard car manufacturers. This means there’s a limit to how many can be produced. When it comes to new energy vehicles however, there are no restrictions, encouraging manufacturers to mass market electric vehicles.
A New Market for Toyota
The Chinese electric vehicle market is huge (growing 80% last year), and can now firmly establish itself as a major player. The first car company to mass produce hybrid vehicles, Toyota have stayed away from plug-in electric vehicles until now. The collaboration with BYD should see them firmly embedded in the electric vehicle market – in particular the lucrative Chinese one.
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