China's electric vehicle and battery maker BYD Co Ltd will restructure its businesses to increase competitiveness amid growing competition from rivals.
Through the effort, it aims to bring its sales revenue to 1 trillion yuan (0.8 billion) by 2025, BYD Chairman and President Wang Chuanfu announced on Saturday at an executive meeting.
The company did not specify how it will make the restructuring, but a report by eeo.com.cn said it will split its businesses in vehicle-mounted software, molds, battery and other components as well as other sectors to allow them to operate independently.
This will enable the businesses to take full advantage of their own strengths and exert a synergy effect, thereby creating new sources of growth, Wang said.
It will also break the boundaries of different sectors, enhance BYD's operational efficiency and improve its market reaction, he added.
Wang stressed that BYD is no longer just a battery company or a car enterprise, but "a pioneer of whole new energy solution".
BYD's revenue amounted to approximately 103.5 billion yuan last year, growing 29.3 percent year-on-year.
However, competition is increasing as more market players enter the field. In October, Beijing Automotive Group Co Ltd surpassed BYD to become the sales champion of new energy passenger vehicle.
Meanwhile, BYD's leading position in the battery sector has also been challenged by Ningde, Fujian province-based company CATL as the latter took the crown of being the largest market shareholder last year.
To cope with the challenges, BYD is also ramping up efforts to develop a monorail transit system named Skyrail both domestically and internationally. The sector has been placed as one of BYD's four key businesses, along with cars, mobile phone components and batteries.
The system is currently running in Yinchuan, capital of the Ningxia Hui autonomous region. Last month, the company said it would soon start trial operation of Skyrail in Egypt, making it the second overseas destination to run the system after the Philippines.
Yu Lingqu, a researcher from the Finance and Modern Industry Research Center at Shenzhen-based think tank China Development Institute, said corporate restructuring of BYD will promote innovation of the company and make it more flexible.
"Many big companies have complicated structures, which reduce their efficiency. By splitting off businesses, some new entities could be created, which will greatly improve the efficiency of the whole company and promote innovation," he said.
Share prices of BYD in the mainland stock market surged after trading opened on Monday, the first trading day after the announcement.
The company's share prices soared 9.28 percent, or 5.9 yuan, to finish at 69.49 yuan per share by the end of Monday trading.