Revealed: How BYD can make dirt-cheap EVs

BYD’s Atto 1 isn’t just cheap for an electric vehicle, it’s cheap for a car. But the Chinese automaker’s secret for making the business case for an EV work at the lowest end of the price spectrum is one that very few – if any – carmakers would be able to replicate.

The BYD Atto 1 might already be middle-aged in its home market of China, but it’s a fresh-faced entrant to Australia having only rolled off the boat right at the end of 2025, wearing a so-sharp-you’ll-cut-yourself price tag of $23,990 plus on-road costs.

We’ve been waiting for internal combustion-EV price parity for a while now, and it’s pretty much here in the form of the Atto 1 – Toyota asks $28,990 for a base Yaris and there are only four cars (Kia Picanto, MG 3, Suzuki Ignis, Hyundai Venue) cheaper than the baby BYD.

So how does BYD do it?

“We’re the most vertically-integrated OEM out there,” BYD Australia product chief Sajid Hasan told carsales.

“There’s no other OEM that’s mining their own lithium, building their own batteries, building their semiconductors and chips and building their own cars.”

“We do it all, and it’s at the scale that we’re doing it – thankfully our parent company’s domestic market is such a huge market – but that’s how we’re doing it.

“It’s control (of those business verticals), it’s scaled, and we’ve got a highly advanced manufacturing process.”

For those without a degree in economics, this means that while other carmakers have to buy many of their components and assemblies from external suppliers, who in turn must add margin to those components in order to be profitable, BYD can instead buy the costly batteries and microchips from itself.

Eliminating the profit-taking that normally occurs as goods make their way up the supply chain means their cars can be built – and thus sold – for less.

Another critical ingredient is limiting the amount of human interaction needed to build a car.

With manpower costs typically being one of the biggest expenses for any carmaker, an even heavier degree of automation has been key for ensuring low-cost cars like the Atto 1 can still be profitable to manufacture.

“I’ve been through a few of BYD’s factories now, and compared to some of the other plants that I’ve been to in the past – mainly Japanese companies – what a vast difference,” Hasan said.

“There’s so much automation, very few people on the floor. It’s a combination of all of these efficiency principles.”

It’s worth noting that Hasan’s resume includes 16 years at Toyota; the company that literally wrote the book on how to build cars efficiently in the last century. BYD might need to write a book of its own.

BYD’s ability to produce cars efficiently (read: cheaply) and at scale is obviously a gigantic commercial advantage for the carmaker, but it also delivers consumer benefits in the form of greater affordability.

The Atto 1’s remarkably low price tag is evidence of that, especially given the expensive battery, motor, and computational technology required to make its all-electric powertrain work.

And according to BYD Australia’s chief operating officer Stephen Collins, the Atto 1’s pricing is not some introductory offer to compel buyers to walk into a showroom.

“Our pricing strategy is to launch aggressively where we can, but also maintain that price integrity,” he said.

“We want to make EV availability and EV motoring more affordable and more accessible.”

Whether other Chinese automakers like GWM, Chery and MG – who all have their most affordable EVs priced above $35k – are able to compete with BYD remains to be seen, but with none of them as embedded into the battery business as BYD is, it seems like the automaker will have the sub-$30k EV segment all to itself for a while.

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