AsianFin -- BYD Co., China’s leading electric-vehicle manufacturer, is under growing pressure to regain investor confidence after a staggering $45 billion stock selloff. The company’s Hong Kong-listed shares have dropped more than 30% from their record high just four months ago, lagging behind competitors and prompting renewed scrutiny of its market strategy.

Analyst sell ratings on BYD have surged to their highest levels since 2022, according to Bloomberg data, reflecting increasing skepticism over the company’s ability to navigate a destructive price war in China’s EV sector. Investors are questioning BYD’s aggressive discounting approach, which has driven sales but raised concerns about profitability and long-term sustainability.

The Chinese government has also intensified oversight of the EV market, cracking down on so-called “involution”—an industry-wide cycle of aggressive price cuts that threatens to destabilize the sector. Meanwhile, rival automakers such as Geely Automobile Holdings Ltd. and Zhejiang Leapmotor Technology Co. are capitalizing on the turmoil, gaining market share as BYD struggles to maintain its competitive edge.

Market watchers say BYD now faces a delicate balancing act: sustaining sales growth while restoring investor confidence and adhering to emerging regulatory pressures. Analysts note that the company’s next moves, including potential adjustments to pricing strategies and product offerings, will be critical in determining whether it can reclaim its leading position in China’s fiercely competitive EV market.