Chinese automaker BYD has reported a significant rise in sales, intensifying its competition with Tesla for the title of the world’s top electric vehicle (EV) seller in 2024.
BYD sold 207,734 EVs in December, bringing its total annual sales to 1.76 million. This impressive performance was fueled by government subsidies and discounts, which attracted a growing number of customers.
Tesla, which is set to announce its quarterly sales figures later today, held a narrow lead over BYD in EV sales during the previous quarter. However, the gap is shrinking as BYD gains momentum.
BYD’s total vehicle sales grew by over 41% in 2024 compared to the previous year, driven largely by its hybrid models. The company’s success has been bolstered by a surge in car sales within China, its primary market. Intense competition has lowered prices, while government incentives have encouraged consumers to transition to EVs or more fuel-efficient cars.
Currently, BYD sells 90% of its vehicles in China, where it has been outpacing foreign competitors like Volkswagen and Toyota.
Legacy Automakers Struggle
The rise of BYD and other Chinese EV makers stands in contrast to the difficulties faced by traditional car manufacturers in Western markets.
In December, Honda and Nissan confirmed ongoing merger discussions to better compete with China’s rapidly advancing EV industry. Similarly, Volkswagen recently reached a deal with Germany’s IG Metall trade union to avoid plant closures and compulsory redundancies, despite previous warnings of potential shutdowns to cut costs.
Meanwhile, Stellantis faced internal turmoil as CEO Carlos Tavares abruptly resigned following a boardroom clash. This came two months after the company, which owns brands like Jeep, Fiat, and Peugeot, issued a profit warning.
BYD Outpaces Tesla in Revenue
In the third quarter of 2024, BYD achieved a significant milestone, surpassing Tesla in revenue for the first time. The Chinese automaker recorded revenues of over 200 billion yuan ($28.2 billion), a 24% year-on-year increase. In contrast, Tesla reported $25.2 billion in revenue during the same period. Despite this, Tesla still leads BYD in global EV sales.
Challenges in International Markets
While BYD is making strides in emerging markets, it faces challenges in Western countries. In October, the European Union imposed tariffs of up to 45.3% on Chinese-made EVs. Similarly, the US has implemented a 100% duty on Chinese EV imports, with further tariffs expected under President-elect Donald Trump.
In Brazil, BYD encountered a setback when authorities halted construction of a factory, citing worker exploitation. BYD has since severed ties with the implicated construction firm and pledged to comply with Brazilian labor laws.
As BYD continues to expand its global presence, its competition with Tesla remains fierce, signaling an increasingly dynamic landscape in the global EV market.