BYD and GE both brought production in-house. Only one kept it.

Two companies decided to make more of their product themselves. One built a cost advantage. The other was out of the business within a few years.

In January 2003, BYD, a battery company, bought the struggling automaker Xi'an Qinchuan for HK$269 million. In February 2012, GE Appliances opened a $38 million water-heater line in Louisville, bringing its GeoSpring heater back from Asia.

The logic at BYD: a company that makes batteries first and cars second carries the cheapest, hardest-to-copy part of an electric vehicle in its DNA, not on a purchase order.

A UBS teardown in September 2023 found about 75% of the BYD Seal's components made in-house, against 46% for the made-in-China Tesla Model 3. The BYD Seal cost about 15% less to produce than the Shanghai-built Model 3.

GE's line was held up as proof that lean manufacturing and reshoring could work at home. By 2016, GE Appliances was owned by Haier, and it announced it would stop making the GeoSpring at the end of that year, because of low sales. After March 2018, the equipment went to Bradford White in Michigan.

Both brought work in-house. The difference is what they brought in. BYD owned the part that decides what an electric car costs. GE brought home one product line, and making it at home could not fix low sales.

Two cases do not make a rule. But before you bring production in-house, ask two questions. Does this step decide my cost? Will customers buy more of what it makes? BYD could say yes to both. The GeoSpring could not.