March 14, 2010, 10:28 AM EDT
March 14 (Bloomberg) -- BYD Co., the Chinese carmaker backed by Warren Buffett, almost quadrupled earnings last year as consumers took advantage of government incentives to buy its F3 compact cars.
Net income rose to 3.79 billion yuan ($555 million) from 1.02 billion yuan a year earlier, the Shenzhen-based company said today in a statement to the Hong Kong stock exchange. Sales increased 47 percent to 39.5 billion yuan.
The F3 was last year’s best-selling model in China, the world’s biggest automobile market, helping make BYD the nation’s fastest-growing carmaker with sales surging 162 percent to 448,397 vehicles. China’s industrywide auto demand jumped 46 percent to a record in 2009.
“BYD and other automakers will have slower sales and profit growth this year given that demand is rising at a slower pace,” said Yin Guohui, an analyst at BOCOM International Holdings Co. in Beijing.
BYD, a battery maker that entered the automobile market in 2003, teamed up with German luxury-car manufacturer Daimler AG this month to develop and sell electric vehicles in China. It is also expanding into Europe and the U.S. to take advantage of higher demand for alternative-energy cars in developed markets.
The Chinese carmaker signed a separate electric-vehicle agreement in May with Volkswagen AG, Europe’s largest automaker. The two companies plan to cooperate in areas including hybrids and lithium battery-powered electric vehicles.
“The company’s strength in battery making will benefit it in the long run, even though sales of electric vehicles are unlikely to become anything major in the near future,” BOCOM’s Guohui said.
BYD aims to become the first Chinese company to sell electric cars in western Europe next year with its E6 model and other hybrids. It may eventually design and build cars in Europe, spokesman Paul Lin said March 8.
BYD may start U.S. sales this year, Chairman Wang Chuanfu said in January. The first E6 hatchbacks will arrive in the U.S. late in the year, according to Henry Li, general manager of BYD’s auto export division.
--Tian Ying and Nipa Piboontanasawat in Hong Kong. Editors: Terje Langeland, James Regan
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