China’s BYD plans to expand its fleet of car-carrying cargo ships from eight to 18 by 2029, according to shipping industry reports. This move aims to address challenges in exporting its rapidly growing production as the world’s largest electric vehicle maker.
Each new carrier, built by China Merchants Industry, will have a capacity of about 9,200 cars. Owning its fleet could reduce BYD’s shipping costs per car by up to 40% compared to renting, as per industry estimates.
BYD’s Shipping Strategy Amid Global Challenges In 2022
In 2022, BYD unveiled a $687 million plan to construct its own car carriers. Founder Wang Chuanfu attributed this to a shortage of shipping capacity for exports. Between January 2024 and September 2025, the company launched eight car carriers.
Earlier this year, BYD disclosed to investors that shipping capacity shortages had impacted its exports. In September, the company sold 180,700 cars outside China, more than double the previous year’s figure and nearly 40% of its total monthly sales.
Conflicts in the Red Sea and around the Strait of Hormuz have increased freight costs and forced ships onto longer routes. Renting a car carrier with a capacity of about 6,500 cars now costs $95,000 a day, up from $50,000 in February, as reported by Clarksons Research.
With BYD targeting sales of over 2.5 million cars overseas next year, up from 1.9 to 2 million this year, owning a fleet helps manage higher shipping costs and provides greater control over logistics, analysts said.
“The very strong growth in Chinese exports, fueling strong Asia-Europe fronthaul demand growth, is the biggest single factor behind the increase in charter rates,” said Stephen Gordon, managing director of Clarksons Research, in a statement.
Most car carriers on Asia-Europe routes are avoiding the Red Sea by sailing around the Cape of Good Hope, adding about 25% to the distance and up to 14 days to each voyage, according to Andrea De Luca of Veson Nautical.
In China, industrywide sales of EVs and plug-in hybrids dropped 12% in the first eight months of the year after the government reduced tax incentives for buyers. BYD saw a 33% decline in domestic car sales during the same period.
Many Chinese carmakers have maintained production by exporting surplus vehicles as domestic demand cooled due to changes in tax and subsidy policies, George Whitcombe, a senior EV analyst at Benchmark Mineral Intelligence, said.
“Control over its distribution network is a strategy BYD has long pursued,” Whitcombe said. “With other Chinese automakers left without their own fleet of ships and exposed to rising shipping costs, it potentially leaves them in a less competitive position to grow their overseas presence.”
Tesla, BYD’s main U.S. competitor, relies on third-party carriers to export from China. Its Shanghai plant exported more cars than it sold domestically in the first eight months of the year. Carmakers that charter ships are more vulnerable to market fluctuations than those with their own fleets, De Luca explained.
BYD’s fleet is about control, and extending into logistics is a natural step now that it exports millions of cars amid geopolitical volatility and cost swings, Lei Xing, founder of Chinese auto consultancy AutoXing, said.
Rival Geely started operating its first car carrier in 2025, leased from London-based Zodiac Maritime. Chery partnered with Wuhu Shipyard in 2023 to build car carriers for its own fleet in eastern China.
Competitive Edge and Market Positioning
BYD’s early investment in the shipping sector is paying off, giving it an advantage over other Chinese automakers. Andrea De Luca notes that this long-term strategy positions BYD well in the current market. Meanwhile, Felipe Munoz highlights that BYD’s massive carriers serve as a powerful marketing tool, projecting an image of strength and agility to the global market.
Industry Response and Future Outlook
BYD’s rivals are also investing in shipping capabilities. Geely’s long-term charter with Zodiac Maritime and Chery’s joint venture with Wuhu Shipyard reflect similar moves among Chinese automakers to secure their shipping infrastructure.