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Investing.com-- Shares of Chinese EV leader BYD Co (HK:1211) fell more than 3% on Thursday after a Reuters report revealed the company has slowed production and postponed its expansion plans, reversing its aggressive growth strategy.
Citing people familiar with the matter, the report detailed that BYD has cancelled night shifts and cut output by at least one-third at four of its Chinese factories. It also delayed the addition of new production lines, measures aimed at managing rising inventory and reducing costs.
Hong Kong-listed shares of the company dropped 3.1% to HK$125.90 as of 06:09 GMT.
The stock saw sharp losses last month after the EV maker’s price cuts intensified concerns over rising competition and narrowing profit margins in the Chinese market.
Although BYD overtook Tesla Inc (NASDAQ:TSLA), selling a record 4.27 million vehicles last year and targeting to reach 5.5 million this year, it has faced mounting pressure from swelling dealer inventory despite deep price cuts, the report said.
One source told Reuters that the measures were intended to cut costs, while another indicated they followed weaker-than-expected sales performance, according to the report.