Investing.com-- Shares of Chinese electric vehicle maker BYD Co Ltd (SZ:002594) rose on Monday after its Chairman and CEO Wang Chuanfu proposed the firm double the size of a planned share buyback.
BYD’s Hong Kong shares (HK:1211) rose 1.9%, while the EV maker’s Shenzhen-listed shares rose 2%.
BYD’s CEO suggested doubling the amount of A-shares to be repurchased under a proposed buyback to 400 million yuan ($56 million). The move was largely aimed at stemming a recent rout in BYD’s shares, even as the EV maker recently overtook Tesla Inc (NASDAQ:TSLA) as the world’s best-selling EV maker.
But even as BYD overtook Tesla, the firm, along with the broader EV sector, was hit by growing concerns over a looming sales slowdown. BYD's shares lost over 22% in 2023.
While China has remained a strong source of demand for EV sales, overseas sales largely slowed in 2023, amid a resurgence in the popularity of hybrid models. Worsening economic conditions- amid high inflation and interest rates in several developed economies- also weighed on vehicle sales.
This cast some doubts over BYD’s plans for an overseas expansion, particularly into Europe and North America.
Still, BYD unveiled and launched a slew of new models in February, with its latest offering being the Yangwang U9 supercar.
The Berkshire Hathaway-backed firm increased its luxury products offering in recent months, amid bets that the high-margin sector still held some demand. Chinese consumer spending was seen increasing during the Lunar New Year holiday.