The BYD logo inside the exhibition hall at the Beijing Auto Show in April 2026. Credit: CnEVPost
- BYD’s sub-brand entities will draw on group resources as needed, with R&D, production and procurement costs settled independently.
- Previously, sub-brand chiefs only handled sales, lacking the incentive and authority for medium- and long-term brand planning.
BYD (HKEX: 1211) is planning to make its sub-brands responsible for their own profit and loss, with Yangwang excluded for now, local media outlet LatePost reported on Friday.
Under the new mechanism, each brand entity will draw on group resources as needed. This covers R&D, production and procurement, with cost settled independently, the report said, citing a person familiar with the matter.
Related to this, BYD is preparing to split its engineering academy into five brand research institutes. The five brands are Dynasty, Ocean, Fang Cheng Bao, Denza and Yangwang.
Another local media outlet, Jipian Lab, first reported the split plan yesterday. It said the engineering academy will retain only its technology platform development function going forward, becoming a relatively pure technology middle platform.
This will change a long-standing tradition at BYD. In the past, vehicle models were defined and developed uniformly by the automotive engineering academy. Core technology resources such as BYD’s hybrid and pure-electric platforms and chassis were all held by the academy.
This centralized approach once delivered significant advantages. Decisions on large, long-cycle technology investments could be made free from short-term profit constraints.
From 2008 to 2024, BYD’s cumulative R&D investment exceeded 180 billion yuan ($26.6 billion). In 2019, when net profit was just 1.6 billion yuan, R&D spending topped 5.6 billion yuan, LatePost’s report noted.
BYD chairman Wang Chuanfu later said the company did not cut R&D during those years despite pressure. In hindsight, many decisions could only have been made under a founder-led model.
For example, in 2008 BYD acquired the bankrupt Ningbo Zhongwei Semiconductor for 170 million yuan, beginning its in-house development of automotive-grade IGBT chips. When subsidy policy introduced an energy-density threshold in 2017, the company also stuck with the lithium iron phosphate (LFP) battery route.
But as BYD began operating multiple sub-brands at once, the limits of the centralized model gradually emerged. Denza, Fang Cheng Bao and Yangwang target different price points and user groups.
Differences in brand positioning require distinct product definitions, design languages and channel strategies. Yet the development inertia of emphasizing technology leadership tends to worsen homogenization across brands.
Previously, sub-brand chiefs only handled sales, lacking the incentive and authority for medium- and long-term brand planning.
Fang Cheng Bao is the clearest example. The brand initially entered market with rugged off-roaders. After the Bao 5 was launched, its performance fell short of expectations for a time, prompting price cuts and the more mainstream Tai series. This moved the brand from “premium personalized” toward the mainstream market.
After taking on their own profit and loss, each brand’s positioning is expected to become clearer, LatePost’s report said.
This restructuring is closely tied to BYD’s current growth anxiety. The company’s sales climbed from 427,000 units in 2020 to 4.272 million units in 2024.
But scaling bottlenecks have since appeared. Full-year sales growth slowed to 7.7% in 2025. In 2026, the company sold 1.405 million units in the first five months, down 20% year-on-year.
BYD Annual NEV Sales 2020-2025
Year
NEV Sales
2020
189,689
2021
603,783
2022
1,863,494
2023
3,024,417
2024
4,272,145
2025
4,602,436
At the annual shareholders’ meeting on June 9, Wang projected the company would keep growing over the next three to five years. He also expected BYD to potentially become the world’s largest by scale in five years.
BYD is not alone. Over the past few years, most Chinese automakers have been consolidating resources. After announcing its Taizhou Declaration in 2024, Geely Auto (HKEX: 0175) shifted from a fragmented to a centralized approach.
Geely set up a unified central research institute while establishing separate vehicle research institutes for Lynk & Co, Zeekr and others. This closely mirrors the logic behind BYD’s current adjustment.
BYD will set up research institutes for its brands, which will be directly accountable for the market performance of their respective brands.
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