BYD said planning to slash sales force by 70pc

BEIJING: BYD Co Ltd, a Chinese carmaker backed by US billionaire Warren Buffett, plans to cut its sales force by about 70 per cent, a Chinese website said yesterday, after the company reported a nearly 90 per cent drop in first-half earnings.

About 1,000 people in BYD's sales arm will be asked to resign, with the ultimate goal of cutting the headcount to 800 from 2,600, eeo.com.cn said, citing unnamed BYD employees.

A mid-level executive at BYD said the initial layoff target was as much as 1,600 people, but the timing of the planned cuts was not clear.

BYD did not confirm details of the layoff plan. However, Li Yunfei, assistant to BYD's general manager, said on his personal microblog posted on Sina.com that the move was a normal personnel transfer for the company's sales arm.

"The sales division has not dissolved or (been) eliminated.

"The personnel reshuffle is aimed at improving our sales service, raising the efficiency internally and externally," he said, without elaborating.

The layoffs represent a small amount of the overall global staff of 120,000 at BYD, which also makes cellphones and batteries. Further layoffs in other departments were possible, the website report said.

BYD has been a shining star since it received an investment of US$230 million from Buffet in 2009. Its F3 sedan was China's best-selling car in 2009 and 2010, but it has been unable to build on its initial success.

A lack of competitive new models makes it particularly vulnerable after the government stripped away tax incentives for small cars at the end of last year. BYD, 10 percent-owned by Berkshire Hathaway Inc, reported a first-half net profit of 275.36 million yuan down 89 percent from a year earlier. - Reuters