Critical metals, crisis-proof profits: BYD, Power Metallic Mines, and Nordex are your key

BYD – China's electric vehicle market in turmoil

China's electric vehicle market is embroiled in a fierce battle for market share. The fight was triggered by massive discounts of up to 34% on certain models by BYD. This aggressive tactic is forcing competitors to follow suit and is squeezing margins across the entire sector. The situation is so tense that even regulatory authorities and industry associations are intervening. They are urging manufacturers such as BYD, Geely, and Xiaomi not to fuel ruinous competition further. The reasons include overflowing inventories of new vehicles, mounting debt, and the real danger of bankruptcies among smaller players.

Despite short-term margin pressure, BYD could emerge as one of the big winners from the crisis. The Company is consistently focusing on vertical integration. It produces around three-quarters of its components, especially the cost-sensitive batteries and chips, in-house, creating significant cost advantages. Combined with highly automated manufacturing, BYD is extremely competitive. Analysts even see the current price cuts as a strategic move to clean up the market. Forecasts indicate that only about 1 in 7 of the more than 130 Chinese electric vehicle brands will survive profitably in the long term. BYD is clearly one of the favorites.

In parallel with its home market, BYD is aggressively pushing into Europe. With attractively priced models such as the Dolphin and local production in Hungary from the end of 2025, the Company is building up its presence and increasing the pressure on established manufacturers. However, this expansion course poses challenges. Massive investments in foreign factories are putting a strain on the cash register in the short term. BYD also has to walk a tightrope in its home market. The government is calling for "shared prosperity" and urging socially acceptable pricing policies. Too-aggressive market dominance could provoke political headwinds. For BYD, it is all about striking a balance between growth and regulatory acceptance. The stock is currently trading at EUR 13.955.

Power Metallic Mines – Expands Canadian project and gains a foothold in Saudi Arabia

Power Metallic is advancing the exploration of an unusual orthomagmatic system at its Nisk project. In addition to high-grade nickel, copper, and PGE deposits, gold and silver are also found here, which is a geological rarity. Such systems, which include Anglo American's Sakatti and Norilsk, often form district clusters. Since 2021, Power Metallic has gradually secured interests and now controls over 200 sq km of land following the acquisition of 167 sq km of adjacent claims. The Company is currently expanding the known mineralization at Nisk and Lion, testing the Tiger target, and developing the new terrain through systematic drilling.

Li-FT Power's recent claim purchase tripled Power Metallics' project area, which was strategically important because it secures 20 km of strike length on the northern edge and 30 km on the southern edge of a sedimentary basin. These zones enclose the Nisk-Lion-Tiger discoveries and show similar geophysical anomalies. The Company is leveraging this to pursue an ambitious 100,000 m drill program through 2026. Data evaluation, air geophysics, and field mapping are ongoing to identify new sulfide occurrences. The latest drilling results from June 4 highlight the potential. In the Lion Zone, 10.99% copper equivalent was found over 12.54 m in one drill hole, and mineralization was extended to the southwest. At Nisk-East, mineralization similar to that on the Lion property was discovered.

Beyond Canada, Power Metallic has secured a remarkable exploration license for the Jabal Baudan project in Saudi Arabia. The 200 sq km area in the mineral-rich Jabal Sayid Belt, known for copper-gold-zinc VMS deposits, is the largest of seven packages offered. Historical exploration has already indicated silicon-rich volcanic rocks and iron stones, typical of VMS systems. The first phase will begin with data research and site visits. Saudi Arabia is supporting exploration with up to USD 2 million per license. Power Metallic will certainly make good use of these funds. The share price has recently consolidated after its strong rise and currently stands at CAD 1.25.

Nordex – Wind in its sails – but the weather remains unpredictable

Wind turbine manufacturer Nordex has become noticeably more efficient, which is reflected in its margins. The gross margin climbed from 19.6% to 27.3% in the first quarter, while the EBITDA margin rose from 3.3% to 5.5%. The decisive factor here was the growing service business, which generates predictable revenue and is less volatile than turbine manufacturing. At the same time, strict cost management is keeping expenses under control. Recent major orders, such as a repowering project in Lower Saxony and new wind farms in France, underscore demand and secure customer loyalty through long-term service contracts.

Although installed capacity declined slightly by 5%, mainly due to delays in approvals, order intake rose by 7%. Europe remains the strong driver, led by Germany, followed by Turkey and Finland. Pricing power appears to be intact. Average sales prices per megawatt rose slightly. However, there are significantly fewer orders from North America, which is likely due to the Trump administration. However, the strong German auction volume of 12-14 gigawatts for 2025 continues to provide a tailwind.

With around EUR 1.2 billion in net cash and low long-term debt, Nordex has a solid foundation. This financial strength provides breathing space for investments or strategic moves. At 37%, the service business is growing significantly faster than turbine construction at 12% and is becoming increasingly important. Nevertheless, disruptive factors such as supply chain bottlenecks, price pressure, fierce competition, especially from China, and regulatory uncertainties pose a threat. Although management is confident that it can cope with US tariffs in the short term, there is still room for improvement in terms of international diversification. The share is currently trading at EUR 16.80.

The race for critical metals requires companies to keep an eye on the entire value chain. BYD dominates the Chinese electric vehicle market through vertical integration and aggressive pricing, but is focusing on growth beyond its home market with European expansion. Power Metallic Mines is advancing the exploration of new deposits through drilling in Canada on the Nisk property and strategic license acquisitions in Saudi Arabia's mineral-rich Jabal Sayid belt. Nordex is relying on growing service revenues and cost discipline, and is taking advantage of tailwinds in Europe, but must prepare for global competition and regulatory risks.