Tesla Rival BYD's Strategic Shift - Pouch-Type Batteries Out, Prismatic In For Safety: Report

China’s BYD Company BYDDY BYDDF, the electric vehicle manufacturer, is reportedly transitioning from pouch-type to prismatic batteries for its hybrids, addressing concerns over the former’s durability and leakage risks.

This strategic shift, impacting factories in Shaanxi, Zhejiang, and Qinghai provinces, aims to completely phase out pouch cells by early 2025, reported Reuters.

Despite no public reports of leaks from BYD vehicles, industry experts and the company acknowledge the higher risk associated with pouch-type batteries, the report noted.

These batteries, encased in a thin metal bag, are more susceptible to electrolyte leaks, potentially leading to fires or explosions.

Also Read: Tesla Vs. BYD: Musk Labels American EV Giant An ‘AI/Robotics Company’ After Chinese Rival Steals Global Sales Crown 

BYD’s decision mirrors the industry trend of moving away from pouch batteries due to safety concerns. Both Volkswagen AG VWAGY and Tesla, Inc‘s TSLA Elon Musk have previously raised red flags about these batteries, as per the report.

BYD’s pivot to self-developed “Short Blade” prismatic batteries, similar to its Blade battery used in pure electric vehicles, marks a significant technological advancement in the EV battery landscape.

While prismatic batteries offer their own challenges, BYD’s shift is important for its hybrid models, which represented nearly half of its global car sales in 2023.

The financial impact on BYD from the production change could not be immediately determined, according to the report.

Price Action: BYDDY shares closed lower by 3.23% at $52.14 on Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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