How BYD grew from a phone battery maker to EV giant taking on Tesla

Elon Musk dismissed BYD in 2011 by laughing at their products during a Bloomberg interview.

“Have you seen their car?” Musk quipped. “I don’t think it’s particularly attractive, the technology is not very strong. And BYD as a company has pretty severe problems in their home turf in China. I think their focus is, and rightly should be, on making sure they don’t die in China.”

BYD did not get wiped out. Instead, BYD dethroned Tesla in the fourth quarter as the top EV maker, selling more battery-powered vehicles than its U.S. rival.

“Their goal was to be China’s largest auto manufacturer and put China manufacturing on the map,” Taylor Ogan, CEO of Snow Bull Capital, said of BYD’s long-standing ambition.

So how did the Chinese company, which began by making phone batteries, become an electric car giant?

While BYD is now known as an electric car giant, its tentacles stretch into many areas from batteries to mining and semiconductors, which is a large reason behind its success.

Chemist Wang Chuanfu founded BYD in 1995 in the southern Chinese city of Shenzhen, China’s massive tech hub. It was founded with 20 employees and 2.5 million Chinese yuan of capital, or $351,994 at today’s exchange rate.

In 1996, BYD began manufacturing lithium-ion batteries, the type that are in our modern day smartphones. This coincided with the growth of mobile phones. BYD went onto supply its batteries to Motorola and Nokia in 2000 and 2002, respectively, two of the mobile phone industry’s juggernaughts at the time.

In 2002, BYD listed on the Hong Kong Stock Exchange, riding the wave of its success in lithium-ion batteries.

It wasn’t until 2003 that BYD acquired a small automaker called Xi’an Qinchuan Automobile.

Two years later, it launched its first car called the F3, which was a combustion model. And then in 2008, it launched the F3DM, its first foray…