BYD, BMW, and RE Royalties in the Spotlight: Price War, Plummeting Profits, Job Cuts, and Green Dividends

BYD Is Shaping the Market

We start by looking to Asia. There, electric vehicle giant BYD is setting the pace for the industry and is likely causing some competitors to lose sleep. The market capitalization figures alone speak volumes. With an impressive market capitalization of over EUR 95 billion, BYD has surpassed numerous established manufacturers and secured a leading position among the world’s top electric vehicle manufacturers. This sheer scale gives the Chinese conglomerate enormous power, and it is one of the key driving forces behind the relentless price war in the Chinese market. BYD benefits from its massive economies of scale, putting traditional automakers under immense pressure. This Asian dominance is forcing European competitors into a rapid and often painful transformation. BYD is operating extremely aggressively and continuously expanding its position.

But BYD does not rely solely on its own size and dominance; it is also going on the offensive both technologically and internationally. In cooperation with battery specialist CATL, the group is driving forward the development of cutting-edge solid-state batteries, with mass production already targeted for 2027. At the same time, the company is enjoying remarkable success in the European market; in the German market alone, new registrations surged by an impressive 358.5% in July 2026, with models such as the Seal U DM-i leading the segment. Admittedly, the ongoing price war and margin pressure are also weighing on BYD’s share price in the short term. At around EUR 9.93, the share is trading well below its mid-2025 high of just under EUR 18. However, the share could soon break through the EUR 10.51 mark and thus reach the 200-day SMA. It could then continue toward EUR 12–13 per share.

Bavaria’s Problem Child: BMW Seeks a Way Out

This fierce battle for market share is also causing major ripples in Munich. We turn our attention to one of Germany’s proudest automakers, which is currently undergoing a painful stress test. The second quarter revealed deep cracks and wounds in the balance sheet. EBIT plummeted by a staggering 38.7% to just EUR 1.631 billion. Even more alarming, however, is the EBIT margin in the automotive business. It slipped to a meagre 2.3%. The average operating profit per vehicle fell to just EUR 1,187. There is almost nothing left, and a few more margin-eaters and BMW will soon be in the red. A major reason for this dire situation is the Chinese market. That is exactly where Asian competitors are operating so aggressively. As a result, BMW’s deliveries in China plummeted by 30.2% in the second quarter. The outlook is even bleaker for electric models. Sales there plummeted by as much as 75% in some cases.

The consequences, of course, are also hitting the core workforce. According to company sources, around 8,000 jobs worldwide are on the chopping block. A voluntary severance program is now intended to provide much-needed relief by 2027. The company is embarking on a drastic cost-cutting course. But in Munich, it is not all resignation. There is an unwavering determination to reinvent itself. The great hope goes by the name “New Class”. Series production of the new, fully electric i3 recently began at the Munich plant. It is expected to bring about a turnaround: cutting costs on one hand, investing on the other. It is a risky move and deep uncertainty prevails on the stock market. BMW shares have lost over 35% of their value since the start of the year. Will the launch of the Neue Klasse take hold quickly enough? From a technical analysis perspective, things could still get interesting. Should the share rise above EUR 62, the rebound could quickly head toward EUR 70. On the other hand, if it falls below EUR 56.40, it could just as quickly dip below the EUR 50 mark.

RE Royalties: Green Stability

Investors who have had enough of these rapid ups and downs in the automotive sector will find a fascinating alternative here, as a completely different sector currently promises more stability. We take a look at RE Royalties. The company is a true pioneer in renewable energy financing. Instead of building vehicles, the Canadian company is building a sustainable portfolio. The strategy is simple but highly effective. RE Royalties extends loans to project developers. In return, the company secures long-term license fees, known as royalties. This smart capital recovery model generates steady revenue. It protects against extreme fluctuations, such as those we see among the major automakers.

Over CAD 82 million has already been invested in 27 completed transactions and more than 130 projects. In doing so, the company has built a robust foundation. Since its founding, the portfolio has generated a strong internal rate of return (IRR) of 16%. At the same time, both the environment and investors’ consciences benefit. The projects prevent over 400,000 metric tons of harmful carbon emissions annually. Economic stability meets ecological purpose here. This makes RE Royalties a favourite among investors who prioritize “tangible value”.

The share is heading toward a key decision point. Following a period of stabilization, RE Royalties’ stock should break out of its consolidation range, either now or in the near future, at the upper end of the CAD 0.45 to CAD 0.46 range. If this breakout succeeds, the share could quickly regain momentum. It would return to the strong uptrend seen from December 2025 to March 2026. At that time, the stock essentially doubled from CAD 0.22 to CAD 0.45. On the downside, the stock is fairly well supported. Solid horizontal support lies between CAD 0.30 and CAD 0.35. If the breakout to the upside is successful, the first price target according to technical analysis is CAD 0.50. If this hurdle is cleared, the path upward is clear. Exciting targets in the range of CAD 0.60 to 0.70 then come into view. The potential is therefore unmistakably present and promises considerable momentum.

BYD and BMW are locked in fierce competition. Price wars and painful restructuring are shaping the landscape of the automotive industry. Both manufacturers have the potential for a comeback, but that currently requires extremely strong nerves from investors. RE Royalties, by contrast, offers a more measured alternative. Its financing model and technical chart setup can make the stock an interesting proposition. For investors seeking growth or alternatives away from the noise of the major automotive battleground, the company could provide a thoughtful portfolio addition. All three stocks remain highly intriguing in their own very different ways.

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