BYD shares are down significantly, wiping out over $60 billion in market value since May. The main issues are cooling demand in China and rising costs for materials like lithium and chips. The January numbers were weak. BYD domestic deliveries dropped 50% from a year ago and XPeng was down over 30%. Rising input costs are expected to squeeze margins further, potentially adding $1,000 per vehicle. Short sellers are building positions against the sector. Even though BYD is trading at a lower valuation of 16x forward earnings, analysts think it is too early to step in given the uncertainty for the rest of the year.