SHANGHAI, March 27 (Reuters) - Chinese automaker BYD Co Ltd , backed by Warren Buffett’s Berkshire Hathaway Inc, said on Tuesday its first-quarter net profit would likely fall sharply amid cuts to subsidies for new-energy vehicles.
BYD, which has invested heavily in battery electric and plug-in hybrid vehicles amid China’s push for greener transport, estimated net profit for the first three months would fall between 75.2-91.8 percent versus a year earlier.
That would put profits for the quarter between 50 million yuan ($7.96 million) and 150 million yuan versus 605.8 million yuan in the same period in 2017.
The Shenzhen-based firm said its annual net profit fell 19.5 percent to 4.07 billion yuan last year, roughly in line with preliminary figures release last month.
In 2016, the firm’s net profit had jumped almost 80 percent.
China’s central government wants the country to be a world leader in new-energy vehicles (NEVs) and related technologies, but has been looking to phase out financial subsidies that have been behind the rapid growth of the sector.
Domestic and international industry executives have called for continued policy support from Beijing to help maintain growth in the world’s largest NEV market, where broader auto sales growth is slowing down.
BYD, which also has businesses in electric batteries and other transport services, should see earnings growth pick up in 2018, with analysts polled by Reuters predicting a 50 percent jump in net profit this year.
$1 = 6.2780 Chinese yuan renminbi Reporting by Adam Jourdan; Editing by Himani Sarkar