BYD’s big plans to move beyond cars and batteries

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Hello there,

Is being ambitious ever a bad thing?

If we were to judge by the average dating-app profile, the answer would be a resounding “no,” but Bumble isn’t the arbiter of these things. Ambition needs to come with a dose of realism. After all, if you try to do considerably more than you’re capable of, you may end up achieving very little.

Chinese automaker BYD has very ambitious goals to expand its manufacturing dominance beyond cars and batteries as well as to capture more market share outside China. But as today’s Deep Read explores, achieving those goals may be a tall order given the geopolitical climate the company finds itself in.

— Peter

THE BIG STORIES

1️⃣ Are SEA’s deliveries about to get greener? These logistics startups think so

Mober CEO Dennis Ng / Photo credit: Mober

Logistics startups are driving the mainstream adoption of electric vehicles across Southeast Asia, with the benefits including savings on operational costs and reducing carbon footprints.

However, the lack of EV charging infrastructure remains a challenge, as does access to financing.

2️⃣ Climate tech has a bankability problem, but there are 3 ways to fix that

Climate tech startups are far from easy to fund, given their large capital requirements, the long timeframes to provide a return, and the lack of data needed to underwrite bank loans.

But with a focus on demystifying climate tech technology, de-risking investing in this sector, and designing fund mechanics specifically for companies in this space, these hurdles could be overcome.

DEEP READ

1️⃣ The ambitions of China’s BYD stretch well beyond electric vehicles

Image credit: Timmy Loen

BYD accounts for one in three new EV sales in China, the world’s largest auto market, but the company has green manufacturing ambitions beyond the sector and beyond the firm’s native country.

While it’s a battery company at its core, analysts say the firm wants to become “an energy ecosystem company.” It currently makes lithium batteries, solar modules, as well as electric-powered buses, trucks, and trains.

While BYD has the advantages of a vertically integrated structure, economies of scale, and large investment in research and development, could it be biting off more than it can chew?

BYD’s ambitions to go global come at a particularly inauspicious time, given the trade tensions between China and the US, as well as increased worldwide scrutiny of the economic risks posed by Chinese firms.

TRENDING NEWS

Also check out Tech in Asia’s coverage of Asia’s ecommerce scene here.

1️⃣ Tesla trims over 10% of global workforce amid lower sales

Tesla’s stock price may be up after CEO Elon Musk’s trip to China, but the firm is also feeling the bite of tough competition in the EV sector. Recently, the company laid off 10% of its global workforce amid falling sales.

Why it matters:

Competition in the EV industry should be good for consumers on the one hand, as it leads to more affordable options at higher quality. On the other hand, if competition leads to companies struggling to balance their books, it could harm the sector in the long run.

2️⃣ Eco-friendly data centers help drive $6.3 billion of green investment in Southeast Asia, but report shows more needed

A report by Bain & Company, GenZero, Standard Chartered, and Temasek found that US$6.3 billion of green investments flowed into Southeast Asia in 2023, with gains mostly driven by green data centers. However, the report cautioned that more investment is needed for the region to hit climate goals.

Why it matters:

A 21% year-on-year increase in investment is nothing to be sniffed at, but the fact that much more is required shows that a lot of work still needs to be done. Green data centers’ prominence is encouraging, given how the industry is expected to grow due to the rise of generative AI.

3️⃣ Global battery rollout doubled last year – but needs to be six times faster, says IEA

New batteries totaling 42 gigawatts were plugged in globally last year – more than double from 2022, according to a report by the International Energy Agency (IEA). However, rollout will need to be much faster for the world to reach its renewable energy goals.

Why it matters:

Simply put, all the renewable energy in the world is no good if it can’t be stored in batteries and used when needed.

4️⃣ VinFast hits $618m in Q1 net loss despite doubling revenue year on year

The Vietnam-based EV manufacturer logged a net loss of US$618.3 million for the first quarter of 2024. The figure was more than double its revenue of US$302.6 million in the same period.

Photo credit: NamLong Nguyen / Shutterstock

Why it matters:

VinFast has ambitious goals, including delivering 100,000 EVs this year. But as of the end of Q1, it had delivered just 9,689. Should they continue, sizable losses like this one will undermine the company’s business case.

5️⃣ Cooling down urban campuses: Can AI do it in a sustainable way?

As the world heats up, air conditioner use is predicted to soar and increasingly drive electricity demand, potentially creating a vicious circle. This article looks at how real estate developers and corporations are exploring more efficient ways to keep buildings cool.

Why it matters:

Anyone who works in one of Asia’s larger cities knows how big of a difference a cool office versus an overheated workplace makes. If optimal temperatures can be reached without relying on air conditioning, all the better.

STARTUP WATCH

1️⃣ India-based Accacia bags $6.5m for real estate decarbonization tool

The startup aims to reduce the greenhouse gas emissions of the real estate and construction sectors, which account for 40% of the global total. Accacia has scored US$6.5 million in a pre-series A funding round led by Global VC firm Illuminate Financial.

2️⃣ Japan’s Spiber raises $65 million to scale up production of eco materials made from fermented ‘Brewed Protein’

Spiber, an eco materials startup, has closed a fresh funding round of US$65 million, taking its total funding to US$489 million. The Japanese company utilizes microbial fermentation to turn produce into eco-friendly materials used in the manufacturing of fashion, automotive, and personal care products.

3️⃣ Tepbac, Vietnam’s answer to eFishery, seeks to raise $20m

Agritech firm Tepbac is aiming for US$10 million to US$20 million in funding to scale its business. After launching as an informational website where farmers can get advice about sustainable shrimp farming practices and technology applications, the Vietnam-based company now offers farm management software Farmext and IoT devices for shrimp farms. It also operates an ecommerce marketplace for farm supplies, as well as a network of aquaculture labs.

Photo credit: Tepbac

4️⃣ Toyota launches new US$150 million climate solutions venture fund

Toyota Ventures, the VC unit of Japanese carmaker Toyota, has rolled out a new fund worth US$150 million for startups focused on climate and environmental sustainability solutions. Toyota Ventures Climate Fund II will build on the progress of the first fund, which invested in 18 companies.

5️⃣ Indian climate-smart deeptech firm Ecozen raises $30 million

Ecozen makes solar-powered cold rooms and pump controllers to help decarbonize agriculture. The India-based company has netted US$30 million in a mix of debt and equity.

That’s it for this edition – we hope you liked it! Do subscribe to continue receiving The Offset.

See you next month!

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The company’s “Tech The Dreamers” project empowers ESG using technology. It recently announced the winning team of the project’s third edition, BlueTrend, which focuses on biodiversity and marine conservation.