A Case Study Of The Impact Of Government Subsidies On BYD’s Financial Performance

Under the development concept of green ecology,the national awareness of environmental protection is increasing day by day,and my country’s automobile industry has also ushered in a new situation,and new energy vehicles have entered the public eye.In view of the high initial cost of construction of the industry,the lack of research and development funds,and the lack of competitiveness compared with the traditional automobile industry,the government has successively launched a number of subsidy policies for each link of the industrial chain to ensure the comprehensive upgrading of the new energy automobile industry structure.By interpreting the long-term annual report data of the case company BYD in this article,it can be found that as a leading company in this field,various financial data disclosed in the annual report are very prominent,which is obviously inseparable from the government’s continuous subsidy funds for many years.However,government subsidies are only an auxiliary means to promote market development and are not sustainable.When the development of the new energy vehicle trade reaches a certain stage,the subsidy policy will gradually be tightened until it is completely withdrawn.Occupy the market with core competitiveness.Therefore,an in-depth study of the impact of government subsidies on the financial performance of these companies can help them face the real financial level after excluding subsidies,and provide substantive suggestions for the government to improve subsidy policies and companies to better respond to subsidy declines.Based on relevant concepts and theories,this paper firstly sorts out the general situation of the new energy vehicle trade,the development process of government subsidy policies and the trade’s acceptance of subsidies,and then introduces the current situation of BYD’s operation and acceptance of government subsidies as a case company.On this basis,the case analysis method and the comparative analysis method are combined,and the data envelopment analysis method is used to obtain the comprehensive technical efficiency of 15 new energy vehicle listed companies,and to reveal the impact of government subsidies on the financial performance of the selected new energy vehicle companies;Then,it conducts a detailed analysis of BYD’s financial status and indicators from 2016 to 2020,observe the changes in various financial indicators before and after excluding the subsidy amount to measure its real performance,and summarize the impact of government subsidies on its financial performance.The deficiencies in the subsidy that cannot be effectively used are put forward and targeted suggestions are put forward.The research results show that the impact of government subsidies on these companies has two sides.It has a obviously beneficial effect on the short-term financial performance of the case company BYD,but not on long-term financial performance.prone to dependence.In this regard,this paper puts forward suggestions from the two levels of new energy automobile enterprises and subsidy policies,so as to help my country’s new energy automobile enterprises to better cope with the decline of subsidies and realize the healthy and sustainable development of the trade.