Reduce the price by 10%! Linglong Tire received BYD price reduction notice

December 6 news, recently, an internal document labeled "2025 BYD Passenger Car Cost Optimization Plan" was circulated on the Internet, attracting widespread attention in the industry. The document pointed out that in view of the intense competition in the automotive market in the future, BYD plans to require its supply chain partners to reduce product prices by 10% starting from 2025, aiming to improve the competitiveness of BYD's passenger cars in the market through collective efforts.

In response to this rumor, BYD officials quickly responded. Li Yunfei, head of BYD's brand and public relations department, clarified on social media that annual price negotiations with suppliers are a regular operation in the automotive industry. The price reduction target proposed this time is based on the company's large-scale purchase volume and aims to discuss costs with suppliers. Optimization plan, rather than unilateral mandatory requirements, emphasizes that both parties will reach a consensus through consultation.

According to Carbon Black Industry Network, the price war in the automobile market has intensified this year. In the first eight months, the number of models in the China market that have implemented price reduction strategies has reached 173, far exceeding the 150 models for the whole of last year, showing the cruelty of market competition. This trend not only puts pressure on automakers and parts suppliers, but also affects the downstream of the automobile industry chain, especially the dealer group. Data from the China Automobile Dealers Association shows that in the past four years, more than 8000 automobile 4S stores have closed due to poor management, and the average number of 4S stores exiting the market every year exceeds 2600, indicating that the industry is accelerating reshuffle.

In this context, as an important member of BYD's tire supplier, Linglong Tire publicly stated that it has received a price reduction notice from BYD and is actively negotiating with the other party on cooperation details in 2025. Linglong Tire revealed that in the first half of 2024, the company provided nearly one million tires to BYD, and BYD has become its largest customer in the field of new energy vehicle supporting. However, in the face of continued rising raw material costs, especially the rising prices of key materials such as natural rubber, Linglong Tire faced considerable cost pressure in the third quarter. Although product prices still declined through internal adjustments and optimized cost control.