Explosion causes BYD share drop

Shenzhen-based electric car and battery maker BYD Co saw its stocks in Hong Kong plunge 9.27 percent Thursday on media reports of an explosion at one of its electric taxi charging stations.

A minor explosion took place in a parking lot in Hong Kong Tuesday when a rapid charger was recharging a BYD-brand taxi and overheated, but the cab driver made a narrow escape, Hong Kong-based news portal takungpao.com reported Thursday.

The accident occurred just one month after BYD started its electric cab initiative in Hong Kong. "Link Management Ltd, manager of the carpark where the fire occurred, said it had suspended use of all 13 chargers used for BYD's electric taxis in three of its carparks in the city," The Wall Street Journal reported Thursday.

Shares of dual-listed BYD closed down by HK$3.05 ($39 cents) at HK$29.85 a share in Hong Kong and down by 2.85 yuan ($47 cents), or 8.22 percent, at 31.84 yuan a share in Shenzhen Thursday.

Investors sold off BYD stocks despite its explanation Thursday morning of what BYD called a "partial melting down of the electric charger."

The fault was caused by a loose connection between the grid and the charger, which led to increased resistance and overload, BYD said in a statement on its verified Weibo account Thursday.

BYD said that it has excluded the possibility of hidden risks in the other existing chargers during an ensuing accident review, and claimed, "The single accident will not affect the normal operation of our electric car business in Hong Kong."

A total of 10 BYD e6 electric taxis have been approved by the local transportation authority for trial operation on the island, and the carmaker plans to introduce 45 electric cabs into the city, qq.com reported Thursday.