Net profit at BYD Co, a Shenzhen-based Chinese car maker invested by Warren Buffet, plunged by a bigger-than-expected 99 percent in the third quarter due to faltering sales.

The company, otherwise known as Build Yourself Dreams, said that its net profit in the first quarter rose 4 percent from last year to 2.4 billion yuan (US$365.9 million). But a comparison with the company's performance in the first half indicated that its profit in the third quarter plunged from last year's 1.16 billion yuan to 11.8 million yuan.

The market had been warned of a possible drop in profit when BYD, which started out making batteries, in July cut its car sales target for the year by 25 percent to 600,000 vehicles because sales have continued to fall since April.

But still analysts were shocked by its results which were worse than they had expected. JP Morgan Chase had previously estimated profit to tumble 55 percent in the third quarter.

Market watchers warned the company is losing its market share because it neglects quality and service as it expands its business.

The shrinking sales were also attributed to BYD's not developing fuel-powered cars - the traditional mainstay in the domestic market.

Go to Forum >>0 Comments