BYD was questioned by the Shenzhen Stock Exchange whether it was overly dependent on subsidies, and responded that the decline in subsidies affected its performance

According to the financial report released by BYD, from January to September this year, BYD's turnover was 88.981 billion yuan, a year-on-year increase of 20.35%, and the net profit attributable to the listed company was about 1.527 billion yuan, a year-on-year decrease of 45.30%.

However, after deducting non-operating items, BYD's net profit attributable to the listed company was -165 million yuan, a year-on-year decrease of 108.38%.

The Shenzhen Stock Exchange sent an inquiry letter to BYD regarding BYD's financial report, "In the first half of the year, your company's non-recurring gains and losses totaled 115,229.8 million yuan, accounting for 131.79% of net profit; the amount of government subsidies included in the current period's gains and losses was 89,449.8 million yuan, accounting for 77.63% of non-recurring gains and losses. Please explain whether your company is dependent on non-recurring gains and losses such as government subsidies, and whether this situation will affect your company's profitability."

However, BYD's car sales are still good.

BYD's overall automobile sales in the first three quarters increased by 25%, among which the sales of new energy vehicles in the first three quarters were 143,400 units, an increase of more than 100% year-on-year.

BYD currently has a large number of orders on hand, and as the bottleneck of battery production capacity is eased, sales are expected to have room for further growth.

BYD stated in its "Announcement on the Reply to the Shenzhen Stock Exchange's Inquiry Letter Regarding the 2018 Semi-annual Report" that due to the decline in subsidies for new energy vehicles, the subsidy revenue for new energy vehicles sold in the first half of this year decreased by about 30% compared with the same period last year.

BYD predicts that although sales will increase significantly in the fourth quarter of this year, the total net profit is expected to decline by 23.10%-32.94% to about 4.066 billion yuan. Of the 1.527 billion yuan in net profit already achieved, 1.452 billion yuan is government subsidies related to automobiles.

BYD hopes to achieve breakthroughs in battery technology by increasing investment in technological research and development in order to cope with the decline and withdrawal of subsidies for new energy vehicles.

BYD's R&D expenses incurred in the first half of 2018 amounted to RMB 2,079,169,000, a year-on-year increase of 50.28%. In the first half of 2018, it introduced a large number of outstanding R&D talents, built a new analysis laboratory, expanded the test center, and purchased a series of high-end analysis equipment, increasing its investment in human and material resources for R&D.

In the first half of the year, BYD's R&D expenses increased by RMB 695.679 million, a 50.28% increase, due to increases in employee salaries, material consumption, depreciation and amortization.

In addition, BYD has begun to seek breakthroughs in the fields of energy storage and photovoltaics, hoping to expand profit channels by using scrapped batteries.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.