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BEIJING, April 28 Chinese automaker BYD Co Ltd
, backed by Warren Buffett's Berkshire
Hathaway Inc, expects a fall of up to 31.4 percent in
first-half net profit as Beijing's cut to subsidies slows green
car sales slow in China.
Shenzhen-based BYD, which specializes in green energy cars,
forecast a 20.3 percent to 31.4 percent fall in net profit for
the first half to 1.55 billion to 1.8 billion yuan ($261.10
million), in what would be the biggest drop in first half
profits since 2012, according to Reuters data.
"The scale back of subsidies on new energy vehicles put
pressure on profit, while competition will still be intense in
traditional vehicle sectors in the second quarter," BYD said in
a stock exchange statement released on Friday.
BYD's weakening net profits are a marked shift from massive
profit growth over the last two years, annual net income
increased more than 10-fold from 2014 to 2016, as demand for
green cars boomed thanks to aggressive government support.
But demand has wavered this year as the central government
has cut its massive subsidy payouts for green cars by 20
percent, raised barriers to entry for new electric car models
and debated easing proposed quotas for plug-in cars.
For the first quarter, BYD reported 605.8 million yuan in
profit, a 28.8 percent decrease year-on-year, in line its
forecast last month of a 24-35 percent fall.
Sales of plug-in hybrid and battery electric cars fell
nearly 5 percent in January to March compared with the same
period a year ago, China's Association of Automobile
($1 = 6.8938 Chinese yuan renminbi)
(Reporting by Muyu Xu and Jake Spring; editing by Susan Thomas
and Alexander Smith)