BYD Surges as Shenzhen Weighs Taxi Incentives: Hong Kong MoverBloomberg News
BYD Co., the Chinese electric carmaker partly owned by Warren Buffett’s Berkshire Hathaway Inc., rose the most in two months in Hong Kong as Shenzhen City said it is considering incentives to promote electric vehicles.
The carmaker gained as much as 13 percent and was trading 11 percent higher at 28.50 yuan as of 14:51 p.m., poised for the biggest one-day gain since April 26. Hong Kong’s benchmark Hang Seng Index fell 0.3 percent.
The southern Chinese city of Shenzhen, where BYD is based, is considering incentives to encourage taxi operators to replace their 15,000 vehicles with electric cars, Lu Xiangzhen, director assistant of the city’s Energy Efficiency and New Energy Vehicles Pilot City Leading Group Office, said in a phone interview today. The news is fueling the shares, said Janet Lewis, a Hong Kong-based analyst at Macquarie Research.
Given that the life cycle of a taxi is usually five years, replacements will occur gradually and taxi operators will make the final decision on whether to make the switch, said Lu, who declined to provide details on the government incentives being considered.
The taxi orders in Shenzhen would be “a drop in the ocean for sales” at BYD, said Lewis, who rates the shares underperform.
BYD also won a contract to produce as many as 25 all-electric buses for the Los Angeles County Metropolitan Transportation Authority as part of a $30 million clean-air bus technology pilot project, according to a June 27 statement.
— With assistance by Tian Ying