Bloomberg Daybreak: Asia Edition China's BYD Slashes EV Price, China-European Union Trade Officials to Meet
11 snips
May 27, 2025 Joohee An, CIO of Mirae Asset Global Investments, provides insights on the impact of BYD's drastic price cuts on electric vehicle stocks and market competition. She discusses the upcoming EU-China trade meeting amid tariff pressures and highlights shifts in investor interest towards domestic markets in China and India. An also delves into currency volatility, noting the dollar's decline and its implications for investment strategies in Asia, as investors reevaluate their focus away from U.S. markets.
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BYD's Price Cuts Trigger Sector Shift
- BYD leveraged its size to seize a first-mover advantage by aggressively cutting EV prices up to 34%.
- This triggered sector-wide price cuts, hurting margins and indicating a tough competitive environment in China's EV market.
Sector Margins Under Pressure
- All automakers, big and small, must respond to BYD's price cuts, putting pressure on margins.
- The sector faces challenges as inventory days rose, making stock offloads through price competition necessary.
EU-China Trade Talks Heat Up
- EU and China increase trade dialogue to counter US tariffs and explore cooperation, including possibly reviving an investment pact.
- EU balances relations with China despite US pressure, showing complex global trade dynamics.