Tesla meets Chinese speed bump; BYD hopes for a turnaround

Doug young
27 August 2013.

A few interesting bits of news coming from the new vehicle energy sector, including a possible roadblock in the Chinese market for emerging US player Tesla (NASDAQ: TSLA) and new results from struggling domestic electric car maker BYD (HKEx: 1211;) Shenzhen: 002594), which look encouraging, but not too exciting. The common main theme in this latest news is, that new energy vehicle manufacturer strong Government measures to increase of the market of Bank assistance continues, although so far slow has to keep hopes for the Chinese market.

We began his life as a mobile-battery manufacturer, then expanded with a look at BYD, starting in cars and recently the new energy vehicle has placed big bets on the sector. The big bet helped attract billionaire investor Warren Buffett, acquired the 10 percent of BYD in the year 2009. His investment sparked a massive rally BYD shares, although they gave most of the gains later as they sputtered traditional car of company.

BYD shares have doubled largely more than traditional gas-powered car business, which accounts for half of sales, from their lows last year on hopes for a turnaround on its. Investors should be relieved to see that BYDs declining sales to 13 percent in the first half of 2013 to 24.2 billion yuan ($3.9 billion), reversing two years in this context. Car sales grew a healthy 25 percent, or about twice as fast by the Chinese automobile sector. These solid gains helped a 26-fold increase of its profit to 427 million Yuan fuel pump.

But despite this it is positive numbers, interesting to note, that BYD electric vehicles (EV) in the section included reflects not the hard way his report highlights every single mention of business, faced the business. BYD has strong despite earlier hopes for the business to make much greater progress with consumer buyers. Instead, she had to leave buyers of taxis and electric buses for the majority of its sales fleet.

Of this fleet buyers steadily grew, even though most of the programs are unclear whether there is any will is currently in the testing phase, and it ultimately lead to large orders, the company must make some, benefited from his big EV investment. It is probably still a little too early, the BYD current line of EVS consider a failure. But a bigger enemy than BYDs begins current technology obsolete soon. Therefore, I suspect that the company needs to make some big write-downs on its EV campaign in the next two years.

By BYD, Tesla, which began look quickly, last week for his high end car, the model S, $70,000 orders in China costs about. The company had to start most of the necessary preparations, delivers its first vehicles including the preparation of a showroom in Beijing, made this year. But now, media reports that Tesla has hit an unexpected setback by the registration of a Chinese brand name squatters.

In this case looks reminiscent of a much higher profile last year between Apple (NASDAQ: AAPL) and a bankrupt technology companies, that the rights to the name iPad. Apple went to court, to get rights to the name, iPad back and supposedly, he landed the case for $60 million.

I suspect that the Government was engaged in this case because of its high-profile and helped to bring about the solution. Tesla is much lower profile, meaning that probably the usual legal channels running through it, if Tesla wants to resolve the matter in court. Rather than face such delays its China plans, I expect the company likely with the squatter to back the rights to his name is, although it probably far less than the $60 million pays those who paid Apple for the iPad brand.

Bottom line: BYD's latest results show that it is running no time for its EV push while Tesla is expected to negotiate to regain the rights to the brand in China.

This article first appeared in the online edition of South China Morning Post and young's China business blog and was published with permission.

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Cleantech turnaround report showing renewable energy recovery

London-despite a difficult market environment, key indicators show signs of improvement in the field of clean tech published after yo of the new annual performance report of the Cleantech industry bankruptcies and consolidation.

"The cleantech sector has shifted worldwide growth. Resource scarcity, energy security concerns, population growth and rising consumption due to the expansion of the middle class in emerging markets continues this Cleantech market growth."--Gil Forer, EYs Cleantech leader
Finding a bounce back in market capitalization, the financial strength of the public pure-play (PPP) strengthened energy efficiency and renewable energy,-Cleantech companies has improved, while their number has grown around the world, the document concludes.

Global, the establishment saw the cleantech sector 68 new PPP-companies in the year 2012 and lost 63 companies during the same period. The United States and China remain leading countries in terms of PPP companies with 70 and 64, or during the Asia-Pacific region as a growth driver, with China's leading number of employees caused growth. Indeed, the Asia-Pacific region was the main winner, increasing by 16 percent to 177 companies, while the company population in Europe, Middle East and Africa (EMEA) shrank 8 percent to 135 companies.

The renewable energy sector occupied important signs of recovery as a sugar-producing undertaking showed about the Board gains benefit from lower cost of equipment. The number of companies rose by 14 percent to 32, stock market capitalization rose by 8 percent to US $25.5 billion and revenue increased by 23 percent to $11.1 billion, EY means.

While the number of wind equipment company around fell 2 percent to 53, market capitalization rose 14 percent to $35.3 billion increased 2 percent to $30.8 billion and revenues. However, the picture for solar more decline by 2 per cent but is mixed market capitalization with the number of solar installation companies by 14 percent to $28.8 billion. However, according to this analysis, solar sales decreased by 16 per cent to $42.5 billion.

Increased bio-fuels, which scored a 8 percent to 41, market capitalization in the year 2012 as the number of companies in the segment also experienced significant growth by 25 percent to $13.1 billion and revenue grew 14 percent to $26 billion.

Commented on the results of Gil Forer, EY is the Cleantech world leader, says: "we have seen a remarkable recovery in the performance of 424 public pure-play-Cleantech companies around the world. Despite a difficult time consolidation in certain Cleantech segments, tax issues in some countries, and the lingering effects of the financial crisis; "We have seen an annual profit of 18 percent of market capitalization and [a] 12 percent staff reduction."

According to the research of the global workforce of public Cleantech companies, is 512.500 with China, as more than half of the global workforce, the source of growth, under the direction of supplements in the solar and wind segments around the world.

Forer concluded: "the cleantech sector worldwide has shifted on growth. Resource scarcity, energy security concerns, population growth and increasing consumption, by expanding the middle class in emerging markets continue to drive the growth of Cleantech market. "China consolidates its position as the most important Cleantech market and prepared for the inevitability as the number one Center for public Cleantech companies."

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