A senior executive at BYD Co. has raised concerns about the electric vehicle (EV) price war in China, calling it unsustainable and hinting at a potential shift in strategy. In an interview with Bloomberg News, Executive Vice President Stella Li described the competition as “very extreme, tough competition,” noting it’s not sustainable.

This comes as the Chinese EV market faces mounting strain, with government intervention and a $22 billion drop in BYD’s market capitalization since late May 2025. For EV owners and enthusiasts, this signals both challenges and opportunities as BYD eyes aggressive global growth, particularly in Europe.

The Unsustainable Price War in China

The EV price war, sparked by deep price cuts led by BYD, has eroded margins across the industry. Beijing summoned industry leaders earlier this month, urging EV makers not to sell cars below cost or offer unreasonable price reductions. Li stopped short of confirming whether BYD would scale back its aggressive discounting but highlighted the toll on automakers, with the company losing around $22 billion in market value since peaking in late May. Despite this, analysts see BYD as a likely long-term winner if smaller and mid-sized rivals are squeezed out, allowing it to strengthen its dominant market share in China.

BYD’s Bold Move into Europe

BYD is turning its focus outward, with plans to invest heavily in Europe. Li revealed the company expects to spend up to $20 billion over the coming years in the region, targeting a particular focus on Europe. This expansion follows BYD’s rapid rise in key European markets like Germany, the UK, and Italy, where its market share is growing thanks to a fast-expanding dealer network and competitively priced offerings, especially plug-in hybrids. The company recently overtook rival Tesla Inc. in Europe, selling nine to ten vehicle models compared to Tesla’s four, a shift attributed to BYD’s wider lineup.

Li emphasized the company’s commitment to after-sales service, expecting its European market share to climb as more customers become familiar with its technology and support. “If we decide to do something, we put all our resources behind it,” she said. “We want to make sure it’s successful in the long run.” This investment could reshape the European EV landscape, offering consumers more affordable options while challenging established players.

Industry Trends and Regulatory Impact

The price war reflects broader trends in the oversaturated Chinese EV market, where a flood of new entrants has triggered rare government intervention. Regulators and investors are pushing for a reset, with Beijing’s talks aimed at stabilizing the industry. For EV owners, this could mean more stable pricing in the future, though it may limit short-term discounts. Technically, BYD’s success hinges on its ability to maintain quality and innovation, such as its plug-in hybrid technology, which combines electric and gasoline powertrains for longer ranges—up to 600 miles on a full charge and tank.

Economically, the $20 billion investment signals confidence in Europe’s 450 million-strong market, where demand for EVs continues to grow. However, the loss of $22 billion in market cap underscores the financial risks of aggressive pricing. For the industry, consolidation looms as weaker players may exit, potentially benefiting BYD’s long-term dominance. This shift could also influence global supply chains and battery production, key components for EV performance.

As BYD navigates these challenges, its strategy offers a blueprint for other manufacturers. Enthusiasts and professionals alike will watch closely as the company balances its Chinese roots with a global footprint, potentially setting new standards for EV affordability and reach.