China’s BYD motors posted huge fourth-quarter results — and it’s shaking off Tesla’s big price-cut war.

BYD, the Warren Buffett-backed “new energy” vehicle maker, reported quarterly profit for the fourth quarter of $1.06 billion (7.3 billion yuan), up from $87.4 million (602 million yuan) a year earlier. That represents over a 1,100% return, or 11-fold increase, year over year.

Gross margins for the automaker increased to 20.3%, surging past the 3.7% it notched a year ago.

For the year, BYD delivered 1.86 million new-energy vehicles (electric and plug-in hybrids) in China and grabbed nearly 30% of all new-energy vehicle sales in the country.

And so far this year, the company is taking even more share, despite a bruising price war triggered by Tesla price cuts in the country in early January. According to Reuters, over 40 automakers have followed suit in cutting prices.

Despite price drops and increased competition, BYD revealed that in January and February, its new energy sales jumped 40%, compared to 34% last year, while Tesla’s dropped to less than 8%. It should be noted that Tesla only sells full EVs in China, and those vehicles (and Tesla vehicles in general) have higher prices versus similar hybrid vehicles.

Following the earnings release, BYD Chairman Wang Chuanfu said that he projects Q1 sales to jump 80% year over year and that weak competitors will be “eliminated” in due time. Though Wang expects 80% sales growth, that's still actually less than the 200% sale increase the company saw in 2022.

This comes amid rising COVID cases and an overall weakening in the Chinese economy, as well as the expiration of some government incentives take a toll on auto sales. The China Passenger Car Association (CPCA) reported vehicle sales fell 20% in the first two months of this year, reflecting the headwinds facing the industry as the first quarter comes to a close.

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Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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