Eagers Automotive shares storm higher on ‘sweet spot’ in surging hybrid sales

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Eagers Automotive shares storm higher on ‘sweet spot’ in surging hybrid sales

Investors have sent shares in Australia’s biggest car dealer rocketing off the back of a buoyant trading

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boosted by surging demand for hybrid vehicles and record sales of used cars.

Eagers Automotive on Thursday reported a 25 per cent fall in annual profit to $223 million on record revenue of $11.2 billion, but investor focus was on management’s upbeat assessment of the company’s prospects.

In particular, they were taken with the growing sales being recorded by Eagers’ retail joint venture with ******** carmaker BYD as Australians opt for cheaper hybrid cars over full electric vehicles from the likes of Tesla.

Eagers shares surged 25 per cent before retreating to close 21 per cent, or $2.61, better at $15.06.

The BYD partnership’s sales leapt 65 per cent in 2024 to 20,520 vehicles as the network expanded at a fast clip, with Eagers on Thursday citing the potential for an additional $38m in pre-tax annual earnings from the joint venture.

Chief executive Keith Thornton said the hook-up with BYD had perfectly positioned Eagers to take advantage of the *********** motorist’s changing preferences.

While sales growth in EVs has slowed, demand for hybrids, which are powered by a petrol or diesel motor and a battery that charges while the engine is firing, leapt 76 per cent last year.

“What we’ve seen is that EVs have flatlined in Australia,” Mr Thornton said.

“The big step up is in hybrids, it’s absolutely the sweet spot at the moment.”

By July, BYD expects to have 100 salerooms around the country, with Eagers owning and operating about 70 of them.

The group said the partnership would likely contribute $400m of the $1b in additional sales forecast by Eagers in 2025, boosted by 6000 orders for the BYD Shark utility.

That would take group revenue out to more than $12.2b, up 44 per cent from three years ago.

More to come.

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