Though Xia is optimistic about BYD's future developments, an employee revealed in a tweet to Xia that "the company has yet to totally get through the difficulties. There is still a long way to go."
In 2010, BYD was mired in a dealers quitting crisis after setting its sales target at 800,000. Due to high inventory and sluggish sales, as many as 308 dealers, 22.63% of the total, had pulled out of the carmaker's sales network.
"Because of high inventory levels, many dealers are competing to cut prices. We were forced to sell cars even at a loss," reported the China Business News quoting an unnamed BYD dealer.
At this, Xia apologized on August 8 via his microblog that "Aiming to seek quick success and instant benefits, I had misled the sales team and treated the dealers harshly. My heavy demands bore down on my team, who then hurt the deals with hard bargains. I am sorry."
During the first half of this year, BYD only sold 225,800 cars, down by 22%. However, its rivals, the Great Wall Motors and Geely, have seen an increase of 48% and 7% respectively.
With less stimulation and the emergence of more joint-venture brands, BYD and other Chinese brands are facing greater challenges.
"We are just a dozen hours away from going bankrupt," warned Wang Chuanfu, CEO of BYD.
At such a crucial period, Xia's resignation has made industry experts and BYD itself speculate upon BYD's development model.
BYD has been expanding rapidly in dealers' networks since it started selling cars in 2003. Its dealers had increased to 300 in 2007, 500 in 2008, and more than 1,000 in 2010.
Moreover, the company has vowed to be the largest carmaker in China by 2015 and in the world by 2025.
"No automaker can achieve the goal to double its sales every year. BYD's fast development will be short-lived," commented an insider.
Xia also stressed many times that "BYD should slow down and focus on the quality of its products instead of growth rate."
Yet, some thought that Xia's leave would not be all bad to BYD, which is under adjustments and needs fresh ideas.
Xia's position was succeeded by BYD's general planning manager Hou Yan, who was the company's vice president for sales two years ago.
Following Xia who has expanded BYD in scale, Hou shoulders the burden of transforming the company from big to strong.
