Leading car dealer group Eagers Automotive has announced a proposed joint-venture with BYD’s exclusive distributor EVDirect.com, to retail and service the Chinese company’s electric cars for this market.
The news comes in the form of a non-binding Term Sheet announced to the ASX stock exchange, on which Eagers trades under the code APE. Under the plan Eagers would have a 49 per cent interest in the venture alongside EVDirect.com.
The initial five-year franchise agreement would provide “an omni-channel retail footprint in all key markets in Australia”, to be created and run by Eagers in partnership with EVDirect.com as BYD’s nominated Australian importer and distributor.
“The dealer group will leverage Eagers Automotive’s retail expertise, scale, geographic diversity, flexible property portfolio and innovative omnichannel retail solutions including integrated digital experiences available online and in shopping centres, service factories and existing physical retail footprint,” said the ASX statement.
This appears to represent a significant change in EVDirect.com’s plans, which until today had been set on exclusively online retailing – the BYD Atto 3 EV is still on sale there from $44,990 drive-away – and a previously announced partnership with aftermarket repairer mycar (formerly K-Mart Tyre and Auto) to service and deliver vehicles.
What this proposed new arrangement means for the future of EVDirect.com’s fixed-price e-commerce channel, imminent Sydney vehicle experience display centre, and the extant mycar deal still mentioned in EVDirect’s FAQ page remains to be seen.
We have reached out to EVDirect.com CEO Luke Todd for more details and will update the story accordingly once we have them.
BYD expects to commence deliveries of its first EV model (said Atto 3) in the Australian market from July 2022 as covered extensively here, with plans to increase to six models by the end of 2023. By this time it has an intensely ambitious goal to be a top-five overall brand.
EVDirect.com has previously spoken about the multi-million dollar investment in a right-hand drive-dedicated production line in China, and has spoken about production of 15,000-plus units annually. To get into the top 5 would require much more than this.
Established in 1995 and based in Shenzhen, BYD is one of the world’s largest and fastest growing automotive manufacturers, specialising purely in electric and hybrid electric vehicles.
Eagers says it is “committed to working expeditiously towards completion of due diligence and the finalisation of binding transaction documentation”.
“We are very excited to be the retail partner for BYD Australia and EVDirect.com as they enter the Australian market. BYD has clear ambitions to quickly grow its presence in Australia and increase EV penetration amongst Australian customers,” said Eagers Automotive CEO Keith Thornton.
“This confirms Eagers Automotive at the forefront of Australia’s transition to a cleaner vehicle future and recognises our national footprint, geographic diversity, retail expertise and commitment to providing innovative solutions for the future of automotive retail.”
In a supplied statement, EVDirect.com founder and CEO Luke Todd added that Eagers would bring an “unrivalled Australian network, retail expertise and leading customer proposition” to help “fast-track [BYD’s] expansion in the Australian market”.
“BYD has an aspiration to grow into a top 5 automotive brand in Australia by sales volume in the next 18 months. BYD’s EVs are known for leading edge technology, superior range and pricing that is on parity with comparable high-quality petrol vehicles, making them ideally suited to the Australian market.”
In addition to the Atto 3, EVDirect has also pledged to sell the BYD EA1 (Dolphin in China) small EV hatch with a target price of $35,000-$40,000 and a focus on ride-share operators. It has previously launched (in small volumes) the T3 van and E6 MPV, though the number sold is unclear.
EVDirect is part of a company called Nexport, part of the TrueGreen Group investment fund. TrueGreen Mobility division received a cash injection from Australia’s St Baker Energy Investment Fund recently, which lists in its portfolio battery developer Novonix and public charge provider Evie, and has invested in Australia’s DC ‘unicorn’ Tritium – which resides on the Nasdaq.
BYD Australia Pty Ltd General Manager Wing You added: “We have been impressed with the approach Eagers Automotive has adopted to provide retail solutions that are responsive to the changing demands of car buyers. It is very much aligned with our thinking and our plans to take BYD to market in Australia.
“When combined with their scale, track record and geographic reach in all key markets, we believe the new combined partnership will further complement the existing strategic plan to expedite BYD’s ambitious growth plans.”
Listed on the Hong Kong Stock Exchange, BYD is the fourth largest automaker in the world by market capitalisation, producing more than 1.5 million vehicles since being founded, with a record 603,783 units sold in 2021.
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