BYD's strong growth in NEV sales has driven a significant improvement in its earnings and eased the pressure on earnings from upstream raw material prices.

In the first half of this year, despite many unfavorable factors including the macroeconomic downturn, Covid outbreaks, chip shortages and continuous increase in raw material prices, the new energy vehicle (NEV) industry performed well, BYD said in an exchange announcement.

BYD Group's NEV sales grew strongly and kept hitting record highs, leading the market share and achieving rapid year-on-year growth, the company said.

This has driven a significant improvement in its earnings and somewhat eased the pressure on earnings from upstream raw material prices, according to the announcement.

In the cell phone parts and assembly business, BYD benefited from improved cost control and product mix adjustment, and profitability recovered despite weak demand in the consumer electronics industry, according to the announcement.

In the first half of this year, BYD sold 641,350 NEVs, up 314.90 percent from 154,579 units in the same period last year, data monitored by CnEVPost showed.

BYD was at the center of discussion this week as rumors about legendary US investor Warren Buffett reducing holdings caused its share price to plunge on July 12.

BYD then said that major shareholders are required to file equity declarations to reduce their holdings, and HKEX's equity disclosure platform does not show information on the reduction.

Buffett is not currently reducing his holdings or has similar plans, and BYD's plunge is mainly due to the market's misinterpretation of HKEX trading rules, local media Yicai said Wednesday, citing an unnamed analyst from Northeast Securities.

For now, the lack of capacity leading to increasingly long delivery lead times is the main challenge BYD is facing. But this situation is likely to see significant relief next month.

If the production increase plan goes well, BYD's monthly production will reach about 300,000 units in August, when delivery lead times for models with severe shortages, including the Dolphin, are expected to be shortened to within one month, Jiemian said on July 11, citing an unnamed insider.

BYD's plan to increase production comes as the company's undelivered order book continues to grow rapidly. As of early July, BYD's undelivered orders had accumulated more than 700,000 units, the report said, citing salespeople at the company.