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BYD, which is being affected by declining subsidies for new energy vehicles, is accelerating the expansion of its monorail systems to revive profit growth, Yicai.com reported.
The Chinese new energy car maker just won the 2.5 billion-Brazilian real ($US689 million) contract to build a light transit system in Salvador, Brazil on Wednesday.
The project is expected to begin in the fourth quarter and be completed in 2020, which will replace the current railways that have been in operation for more than 100 years. And it will be BYD’s first cross-sea straddle monorail built in the world.
Since the beginning of this year, BYD’s performance has been unsatisfactory. Its net profits have fallen sharply as a result of the declining new energy vehicle subsidies. For the first quarter this year, its net profit was 102 million yuan, down 83% from a year earlier.
The company made its foray into the monorail business two years ago and have reached deals with several Chinese cities as well as Philippines, Cambodia, Morocco and Egypt. It hopes to generate new earnings and cut its reliance on the domestic market.