This article first appeared on GuruFocus.
Investors watching BYD (BYDDY) this week are getting a new plot twist as China’s market regulator pushes the company into a sweeping software fix for its Qin Plus DM-i plug-in hybrids. The mandate covers 88,981 sedans built between January 2021 and September 2023, a window that helped define the model’s rise as one of BYD’s top sellers. The move follows a formal investigation into battery-pack defects, a development that could be meaningful given the model’s scale and its role in supporting BYD’s monthly sales momentum.
Regulators pointed to consistency issues that emerged during production of the battery packs, a flaw that may lead to limited power output and, in more severe scenarios, prevent the vehicles from running in pure electric mode. For a model that accounted for around 20% of BYD’s total sales in October, the timing could be consequential. This episode arrives as China’s EV leaders compete for reliability advantages, and any forced update of this size may influence how investors frame the company’s quality-control narrative heading into the next phase of the market cycle.
BYD plans to deploy an over-the-air update remotely, track vehicles for potential anomalies, and rely on warning lights to alert drivers if any faults surface. Should issues be detected, the company will replace the battery pack free of charge. While the remedy could help stabilize sentiment, the situation may also prompt investors to reassess how BYD manages scale, scrutiny, and software-driven fixes across its fastest-moving product lines.
