W36920

BYD AUTO: FROM BATTERY MANUFACTURER TO ELECTRIC-

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By 2023, BYD Auto Co. Ltd. (BYD Auto), a subsidiary of the Shenzhen, China–based battery manufacturer
BYD Co. Ltd. (BYD), had emerged as a global player in the competitive electric-vehicle (EV) landscape
through a series of strategic initiatives. Chief among these initiatives was the launch of the Dynasty series
of EVs. This case explored the design and branding factors that fuelled the subsidiary’s growth, offering
insights into the challenges and opportunities that BYD Chair and President Wang Chuanfu confronted in
navigating the rapidly evolving EV sector. What strategic move would Chuanfu make in 2024 to help BYD
Auto innovate on its EVs?

A STRATEGIC LEAP FROM BATTERY PIONEER TO EV VISIONARY

In 1995, BYD, short for “build your dreams,” launched in the bustling technological hub of Shenzhen,
China. Behind this audacious venture stood Chuanfu, a visionary chemist whose profound insights into
renewable energy promised to revolutionize the EV industry.

Starting in the unassuming realm of rechargeable-battery manufacturing, BYD's initial phase was anything
but ordinary. Under Chuanfu’s astute leadership, the company swiftly differentiated itself from its
competitors, pioneering an unparalleled battery technology that exemplified BYD's technical acumen and
underscored the company's capacity to reshape industry standards.
Yet, for a strategist like Chuanfu, the battery market was just the start. He discerned the potential of EVs as
the next frontier in sustainable transportation. However, venturing into the automotive domain would be an
audacious move in a competitive landscape peppered with entrenched players.
Transitioning to automobile production entailed multifaceted challenges, from research and development
investments to market-penetration strategies. However, with his strategic foresight, Chuanfu launched the
subsidiary BYD Auto in 2003 and navigated these complexities, demonstrating the company's adaptability
and resilience.
Interestingly, amid these strategic shifts, even the naming of BYD Auto’s new vehicle models became a
testament to its meticulous attention to detail, emphasizing the importance of branding in market differentiation.

This document is authorized for use only in Dr. R. Patnaik, Dr. Shyam S, & Dr. S. Harichandan's Strategic Management Term- IV Dr. R. Patnaik, Dr. Shyam S, & Dr. S. Harichandan at Institute
of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.
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THE BIRTH AND DEVELOPMENT OF THE BYD QIN

BYD's foray into the automobile-manufacturing sector marked a transformative phase in its journey. BYD
Auto was not just a new business venture; it was a paradigm shift into a fiercely competitive realm,
traditionally the playground of industry behemoths like Audi AG, BMW AG, and Mercedes-Benz Group AG.
Chuanfu, the architect of the company’s transformation, however, was no novice to challenging established
norms. His unwavering belief in the future of EVs compelled him to redefine BYD's strategic direction.

In the landscape of automotive innovation, BYD Auto marked a significant milestone with the development
of its first EV, the BYD QIN (the QIN), a compact sedan named after the ancient Chinese Qin dynasty.

Contrasting with the prevalent alphanumeric naming conventions used by the aforementioned competitors,
the name of BYD Auto's pioneering EV was distinctive and culturally rooted. The Qin dynasty, known for
unifying China, symbolized the onset of a new era. Similarly, the QIN signified a new chapter in the
automotive industry, especially in the EV segment.

Thus, the choice of the name reflected BYD Auto's respect for cultural heritage while also illustrating the
company's ambition to innovate. This blend of the past and the present in the QIN showcased BYD Auto's
commitment to integrating traditional Chinese culture with modern technological advancements.

The QIN was not only BYD Auto's first foray into EVs but also a statement of the company's vision. It
embodied the idea that modern technology could coexist with, and even enhance, traditional culture. The
vehicle symbolized BYD Auto's endeavour to lead in the EV market, as the Qin dynasty led in unifying
China. However, BYD Auto approached this ambition with a sense of humility, understanding the vastness
of the challenge in the competitive, rapidly evolving automotive industry.

Therefore, in designing the QIN, BYD Auto focused on combining efficiency and performance with an
aesthetic that would pay homage to Chinese history. The vehicle boasted advanced features and a design
that would appeal to modern consumers and those who valued cultural heritage.

Given that challenge, BYD Auto's journey with the QIN entailed considerable learning and adaptation. As
the company ventured into uncharted territory with its first EV, it faced numerous obstacles, from
technological hurdles to market acceptance. Thus, the journey of the QIN was a chronicle of BYD Auto's
resilience and adaptability. Each challenge was met with a humble understanding that innovation was an
ongoing process, requiring persistence and dedication.

The market response to the QIN was positive and reflected BYD Auto's understanding of its consumers'
values and aspirations. The vehicle appealed to those who appreciated the blend of heritage and innovation,
carving a unique space for BYD Auto in the EV market. This strategic positioning remained crucial for
BYD Auto in continuing to navigate the competitive automative landscape.

The QIN exemplified how automotive companies could innovate while respecting and incorporating
cultural history. It represented a vehicle at the crossroads of the past and the future, symbolizing a bridge
between historical reverence and a commitment to sustainable innovation. BYD Auto, through the QIN,
showed a path forward for the automotive industry, where respect for tradition and technological
advancement could go hand in hand.

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THE ADVENT OF THE BYD TANG

After the remarkable success of the QIN, BYD Auto, under the leadership of Chuanfu, embarked on a new
venture to diversify its product lineup. This led to the development of the BYD TANG (the TANG), an
innovative EV that marked BYD Auto's entry into the sport-utility vehicle (SUV) segment. The name,
inspired by the historically significant Tang dynasty, represented a period of flourishing cultural and
technological advancements, aligning with BYD Auto's vision of blending historical inspiration with
modern innovation.

The move to develop the TANG, a mid-size SUV, signified a strategic shift from BYD Auto's initial focus
on compact sedans. This decision reflected the company's responsiveness to evolving market trends and
consumer preferences. Chuanfu's leadership was pivotal in steering BYD Auto in this new direction,
demonstrating a commitment to broadening the company's reach in the EV market.

The TANG's development began ambitiously, aiming to capture the growing global interest in SUVs. This
shift in product strategy was a response to the diversification of consumer preferences and the increasing
demand for vehicles offering both luxury and environmental sustainability. As with the naming of the QIN,
the decision to name the vehicle the TANG, among China's most prosperous dynasties, reflected BYD
Auto's aspiration to blend historical reverence with modern innovation.

The process of designing and developing the TANG involved the collaborative efforts of various
departments within BYD Auto. Engineers, designers, and market analysts worked cohesively, drawing on
their collective expertise to create a vehicle that would set new standards in the electric SUV category. Their
goal was to develop a vehicle that would advance current technology and reinforce BYD Auto’s
commitment to quality and innovation.

Throughout the development phase, BYD Auto’s team faced numerous challenges, from technical hurdles
to ensuring that the TANG would meet market expectations. These challenges were approached with a
problem-solving mindset, showcasing the team’s resilience and dedication. The focus was not only on
incorporating advanced technology but also on creating a design that would resonate with consumers,
blending elegance with functionality.

The interior design of the TANG was a particular focus, aiming to provide a luxurious and comfortable
experiencing. The use of high-quality materials, attention to ergonomic design, and incorporation of the
latest in-car technology were all part of this effort. Moreover, the TANG's hybrid engine, a pioneering
feature at the time, was developed to offer a balance between performance and environmental
consciousness, embodying BYD Auto's commitment to sustainable innovation.

As the TANG project progressed, it garnered considerable interest within the automotive industry. The
anticipation around its launch reflected BYD Auto's growing reputation as a company capable of breaking
new ground in EV technology. The unveiling of the TANG was a moment of pride for the entire team at
BYD Auto, showcasing their hard work and the company's evolution in the EV market.

Upon its release, the TANG received positive feedback from both consumers and critics, reinforcing BYD
Auto's strategic direction and the effectiveness of its market adaptation strategies. The success of the TANG
in the market not only affirmed the company's vision but also highlighted the competencies and dedication
of its employees, who had worked tirelessly to bring the ambitious project to fruition.

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of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.
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In the wake of the TANG's success, BYD Auto kept its focus on innovation and market expansion. The
company recognized that the automotive industry was rapidly changing and that staying ahead would
require continual innovation and a deep understanding of consumer needs. This ethos of perpetual growth
and adaptation had become a cornerstone of BYD Auto's corporate culture, driven by the vision of Chuanfu
and the collective efforts of BYD Auto’s employees.

Nevertheless, success, while celebrated, was not a signal to rest. The triumphs of both the QIN and TANG
had sent expectations soaring, fixing the gaze of both the market and consumers on BYD Auto. Thus, for
the team at BYD Auto, complacency was not an option. The journey of innovation and defiance of
conventions had only just begun, and the road ahead would be long and demanding. However, the wheels
were already in motion, so there was no turning back.

THE EMERGENCE OF THE BYD SONG

In the dynamic landscape of the automotive industry, BYD Auto identified an opportunity to further
diversify its product lineup following the success of the QIN and TANG. Recognizing the potential in the
compact-SUV segment, the company embarked on the development of the BYD SONG (the SONG), named
after the Song dynasty, known for its economic vitality and cultural richness within a smaller territorial
expanse than the Tang dynasty.

The Song dynasty's ability to thrive in a more condensed geographical area resonated with BYD Auto's
vision for their new vehicle. The SONG was conceptualized to embody the dynamism and prosperity of its
namesake dynasty, packaged in the more limited dimensions of a compact SUV. This strategic decision was
reflective of Chuanfu’s commitment to broadening BYD Auto’s reach in the EV market and to adapting to
consumer preferences for more agile and versatile vehicles.

The development of the SONG was a meticulous process, blending historical inspiration with practical
market considerations. BYD Auto's team, comprising engineers, designers, and market analysts, worked
collaboratively to ensure that the SONG would exceed market expectations in the compact-SUV category.
The objective was to create an affordable yet high-quality and high-performance vehicle.

Technical specifications were key to the development of the SONG. The EV was equipped with a 1.5-litre
turbocharged gasoline engine and two electric motors, coupled with a dual-clutch transmission. Although smaller
than the TANG, the SONG was robust and efficient, reflecting the resilience and vigour of the Song dynasty.

In terms of design, while the TANG catered to consumers looking for luxury and a larger size, the SONG
was crafted to appeal to those seeking a smaller, more agile vehicle. It measured 4,680 millimetres (mm)
long, 1,810 mm wide, and 1,680 mm tall, with a wheelbase of 2,785 mm. This made the SONG an ideal
choice for consumers desiring compactness without performance loss.

The interior design of the SONG was a harmonious fusion of historical elegance and modern technology,
drawing inspiration from the cultural affluence of the Song dynasty. Despite its positioning as a more
affordable option, BYD Auto ensured that the SONG offered quality and performance on par with its higher-
priced counterparts.

When the SONG was introduced at the 2015 Shanghai Auto Show, it encountered initial skepticism regarding
its viability in a market dominated by larger models. However, as with the enduring legacy of its historical
namesake, the SONG defied expectations and quickly became one of BYD Auto's top-selling models.

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of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.
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The success of the SONG in the market attested to the company's innovative approach and understanding
of consumer needs. It reinforced the notion that innovation in the automotive industry was not solely about
size or luxury, but also about understanding and redefining market dynamics. BYD Auto's venture into the
compact-SUV segment with the SONG showcased the company’s versatility and commitment to meeting
a wide range of consumer preferences, solidifying its position as a leader in the EV industry.

THE LAUNCH OF THE BYD YUAN

By 2014, after BYD Auto had successively released several EVs, Chuanfu turned his attention to an emerging
market niche that had yet to be fully explored. This insight led to the development of the BYD YUAN (the
YUAN), named after the Yuan dynasty, known for its unique combination of strength and agility.

The idea behind the YUAN was to create a compact SUV that would cater to consumers seeking both
compactness and robustness in an SUV. This concept was aligned with BYD Auto's strategy to diversify its
offerings and to meet the evolving demands of the global market. Chuanfu, known for his innovative
leadership and approach, recognized the potential of this new model to fill a gap in BYD Auto's product lineup.

The development of the YUAN reflected BYD Auto's commitment to innovation and adaptability. The
vehicle was envisioned to embody the Yuan dynasty’s nimble yet formidable Mongolian warriors. This
design philosophy aimed to strike a balance between practicality and performance, catering to a segment
of the market that desired a versatile, efficient vehicle.

Throughout the development process, the BYD Auto team faced and overcame various challenges. These
included technical complexities and understanding the dynamics of a new market segment. The team's
efforts were focused on ensuring that the YUAN would not only meet but exceed the expectations of
consumers seeking a compact SUV.

The technical specifications of the YUAN were carefully crafted to align with its design philosophy. The
vehicle featured advanced engineering, combining efficiency with agility, making it suitable for a wide
range of consumers, from adventurous individuals to families seeking a reliable, versatile vehicle.

Upon its introduction, the YUAN was received positively. Its combination of strength, agility, and compact
design resonated well with consumers. The success of the YUAN in the market was a testament to BYD
Auto's ability to innovate and respond to consumer needs effectively.

The YUAN's market performance also reflected the company's strategic vision under Chuanfu's leadership.
It demonstrated BYD Auto's capacity to keep up with market trends and to anticipate and address emerging
consumer preferences.

The YUAN's success story epitomized innovation and persistence. It underscored the idea that true
innovation sometimes lay in revisiting and reimagining what existed, rather than creating anew. Moreover,
it highlighted BYD Auto's journey in expanding its product range and solidifying its position in the EV
market. The YUAN, with its blend of compactness, versatility, and strength, symbolized BYD Auto's
commitment to meeting diverse consumer needs and to pursuing excellence in the automotive industry.

THE ARRIVAL OF THE BYD HAN

As BYD Auto continued to grow and diversify its EV lineup under the leadership of Chuanfu, the company
identified an opportunity to expand into the mid-to-large luxury-sedan market, which demanded a vehicle

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of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.
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blending luxury, performance, and technological advancement. This insight led to the development of the
BYD HAN (the HAN), named after the influential Han dynasty, which followed the Qin dynasty and was
known for its cultural and technological progress. BYD Auto drew this parallel with the Han dynasty to
signify the HAN as a leap forward in the company’s journey, integrating cutting-edge technology with a
design that reflected the dynasty's grandeur.

The development process for the HAN was painstaking and collaborative. The team at BYD Auto, guided
by Chuanfu’s wisdom and vision, focused on creating a vehicle that would set a new benchmark in the mid-
to-large luxury-sedan market. The project involved overcoming various challenges, from technical
obstacles to ensuring that the HAN would meet the evolving expectations of consumers in this segment.

Among the key features of the HAN was its the revolutionary Blade Battery technology, which attested to
BYD Auto's commitment to safety, efficiency, and sustainability. The technology represented a significant
advancement in EV technology, offering increased range and improved safety standards.

The HAN’s debut in 2020 sent shockwaves through the automotive world, culminating in an unprecedented
surge in sales within its market segment and making the vehicle one of China's top-selling mid-to-large
luxury sedans. Critics and consumers alike heaped praise on the vehicle for its stellar performance,
luxurious features, and exceptional value. The HAN did not just raise the bar; it redefined standards for
Chinese automotive craftsmanship, echoing BYD Auto's unwavering dedication to excellence.

The story of the HAN was more than the launch of a new model. It symbolized BYD Auto's journey of
continual innovation, resilience in the face of challenges, and unwavering commitment to realizing its
dreams. The HAN also reinforced the company's dedication to creating vehicles blending historical
inspiration with groundbreaking technology.

BYD AUTO'S SUCCESS

After over a decade of unwavering dedication and unceasing exploration, BYD had accomplished a
profound strategic metamorphosis. From its origins as a battery manufacturer, the company had evolved
into BYD Auto, a full-fledged automobile powerhouse. Moreover, the BYD Auto name, formerly equated
with budget-friendly compact vehicles, now stood for a diverse portfolio of vehicles, encompassing nimble
compact vehicles to opulent sedans. This evolution transcended mere appearance—BYD Auto was now an
emblem of China's inventive prowess and tenacity.

Central to this transformation was the ingenious strategy of naming vehicles after Chinese dynasties—a
branding distinction unique to BYD Auto. This not only evoked consumers’ identity but also encapsulated
the company's journey. Analogous to historical dynasties, each vehicle model represented a distinct chapter
in BYD Auto's narrative, charting the company’s maturation and advancement.

With the launch of the QIN, christened after China's inaugural imperial dynasty, BYD Auto embarked on a
voyage through the annals of Chinese history. The next three models—the TANG, the SONG, and the
YUAN—resonated with the essence of their respective dynastic inspirations, encapsulating the strength,
elegance, and sophistication they introduced.
The HAN, representing BYD Auto’s ambitious foray into the mid-to-large luxury-sedan segment, became
the pinnacle of this evolution. Symbolizing ambition, tenacity, and an unwavering commitment to
innovation, the HAN was more than a mere automobile; it was a bold declaration of BYD Auto’s prowess,
marking its prominent position on the global stage.

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of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.
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In the aftermath of the HAN's triumphant launch, BYD Auto sought new horizons. The company
transitioned from being a mere participant in the automotive arena to a pioneering force shaping its future.
The HAN's success dispelled long-held misconceptions and proved that a Chinese automaker could rival
global giants. The world was now attentively watching BYD Auto in its new role as an industry trailblazer.

BYD AUTO'S FUTURE

In 2024, in the solitude of his office, Chuanfu found himself surrounded by piles of new EV blueprints,
each representing a new dream, direction, and opportunity. The plans were a physical representation of the
dreams that Chuanfu and the BYD Auto team had helped make a reality. Among the plans was one for a
new vehicle series titled Yangwang, meaning “looking up” or “aspiring” in Chinese, which seemed to
beckon yet another a leap for BYD Auto into a new era of innovation and discovery.

In this moment of reflection, Chuanfu’s approach was characterized by humility and respect for the journey
ahead. He understood that each decision at BYD Auto would be a step toward technological advancement
and toward realizing a larger dream—one that was as much about the company's growth as it was about its
commitment to sustainable development and a better future.

Chuanfu’s decisions now would shape the future of BYD Auto, guiding it into exciting territories. The
legacy of the company’s past had mingled with the promise of its future, leaving infinite possibilities. What
steps would Chuanfu take in 2024 to enable BYD Auto to keep innovating?

This document is authorized for use only in Dr. R. Patnaik, Dr. Shyam S, & Dr. S. Harichandan's Strategic Management Term- IV Dr. R. Patnaik, Dr. Shyam S, & Dr. S. Harichandan at Institute
of Management Technology - Nagpur (IMT) from Jul 2024 to Dec 2024.