China’s BYD expects to win 1.52 billion yuan deal for Shenzhen electric buses

PUBLISHED : Tuesday, 26 July, 2016, 11:15am
UPDATED : Tuesday, 26 July, 2016, 10:52pm

BYD, China’s largest new energy vehicle maker, said Monday night it won a 1.52 billion yuan (US$227 million) preliminary bid to supply hundreds of electric buses to Shenzhen’s state public transportation operator.

The Shenzhen-based automaker, which counts US billionaire Warren Buffett as an investor, is expected to provide four batches of new energy buses to Shenzhen Bus Group under the tender offer, according to a filing to the Hong Kong stock exchange.

The company’s shares had risen 1.66 per cent to HK$52.10 as of 2.13pm Tuesday.

The official websites of the Shenzhen Bus Group and Shenzhen International Tendering Co carried the bidding results.

The deal was another boost for the automobile and battery maker’s prospects only days after South Korean conglomerate Samsung Electronic snapped up a 3 billion yuan, or 2 per cent, stake in BYD, with the funds to be used to ramp up its electric vehicle production.

“If the project is successfully implemented, there will be a positive effect on the operating result of the company,”company chairman Wang Chuanfu said in a statement.

Earlier this month, BYD said the bulk of a 1.8 billion yuan deal that it secured from another state-owned bus operator a week earlier had been cancelled.

The company said on July 11 that Shenzhen Western Bus Company terminated a procurement proposal for 2,228 10-metre long electric buses from BYD Auto Industry.

Technology and car giants, both in China and abroad, have been betting on the burgeoning new energy car industry.

Separately, Chinese carmaker Geely Automobile Holdings said in statement Monday night that it intended to spin off its stakes in two low end electric vehicle ventures for a total of 1.35 billion yuan to focus on the premium market segment.

“The disposals will allow the group to allocate more time and resources to the development of mid to higher-end automobiles,” it said in a regulatory filing.

Geely shares in Hong Kong climbed 2.86 per cent to HK$5.04 as of 10:23am.