German dealership Sternauto opens BYD store in Berlin

  • Reuters
  • Stock Market News
German dealership Sternauto opens BYD store in Berlin
Credit: © Reuters.

By Victoria Waldersee and Annegret Hilse

BERLIN (Reuters) - Chinese EV giant BYD's five models on sale in Germany will be showcased at a new BYD-only store in Berlin run by dealership Sternauto, in the latest sign that the carmaker is rapidly encroaching on European competitors' turf.

Sternauto, which has exclusive rights to sell BYD cars in eastern Germany, set up the store to get closer to customers as awareness of the brand grows among Germans seeking an affordable electric vehicle.

"One of the biggest topics for BYD is that it is not that familiar to German customers," Oliver Hein, head of BYD for Sternauto, told Reuters. But recognition is growing "exponentially" as the brand invests heavily in marketing, he added.

While most of BYD's revenues still stem from sales in China, the carmaker has set its sights overseas with new manufacturing capacity under construction in Hungary, Brazil, and Thailand.

It sold more EVs than Tesla (NASDAQ: TSLA ) in the fourth quarter of last year and is growing at a fierce speed, with 2023 net profit expected some 86.5% above 2022's.

Already, it is coming under scrutiny from European officials investigating whether carmakers exporting China-made EVs to Europe have an unfair advantage over domestic players, in a sign of the looming regulatory battle between Europe and China as Europe attempts to shield its market from low-cost competition.

© Reuters. A BYD SEAL electric vehicle is displayed during a BYD store opening at the car dealership Sternauto in Berlin, Germany January 31, 2024. REUTERS/Annegret Hilse

While Chinese brands can sell their vehicles in Europe at higher prices than in China and still undercut local pricing, they also face challenges from supply chain bottlenecks to import costs and complex certification requirements.

"There's going to be a major shakeout of Chinese brands in the next 5-10 years," Hein said. "If someone runs out of steam, they'll be out of the market relatively fast," he said, adding Sternauto felt BYD had what it takes to succeed.

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