By Joseph Moss, International Banker
On May 22, JATO Dynamics published a new report revealing that BYD Auto Co. had sold more pure battery electric vehicles (EVs) in Europe than Tesla during April, marking the first time it had done so. The figures reflected just the latest milestone achieved by China’s leading EV maker, as it continues to outpace its American rival in sales volumes all across the globe. With Tesla’s chief executive officer, Elon Musk, continuing to elicit widespread consternation for his recent political dalliances and with the company’s declining sales trends in recent times, the Tesla-BYD gap may widen further as the Chinese automaker continues to extend its dominance in the global EV market.
Indeed, 2024 was the first year in which Tesla registered an annual drop in sales, delivering 1.78 million vehicles compared to 2023’s 1.8 million vehicles. The decline has continued this year, with vehicle sales plunging by 13 percent in the first quarter to a near three-year low, followed by a further 14-percent loss in the second quarter, marking the company’s worst-ever quarterly decline. This negative trend has been most pronounced in Europe, where Tesla registrations plummeted by 43 percent in the first two months of the year, which stood in stark contrast to the 31-percent growth in sales experienced by the region’s wider industry. JATO also reported a year-over-year drop in Tesla’s total sales volumes of 49 percent for April.
Meanwhile, BYD enjoyed an impressive 359-percent rise during the same month, with JATO attributing this surge to the Chinese firm’s broad and competitive lineup of fully electric vehicles and plug-in hybrids. “Although the difference between the two brands’ monthly sales totals may be small, the implications are enormous,” Felipe Munoz, global automotive analyst at JATO, said of the figures. “This is a watershed moment for Europe’s car market, particularly when you consider that Tesla has led the European BEV [Battery Electric Vehicle] market for years, while BYD only officially began operations beyond Norway and the Netherlands in late 2022.”
The report noted that BYD’s rapid expansion has already pushed it ahead of established European car brands, outselling Fiat, Dacia and Seat in the United Kingdom; Fiat and Seat in France; Seat in Italy; and Fiat in Spain, with remarkable growth being achieved even before production begins at its new plant in Hungary. And while tariffs imposed by the European Union (EU) on Chinese-manufactured EVs earlier this year did initially pare the sales growth of China’s automakers across the continent, JATO’s research also confirmed that firms nonetheless managed to find alternative solutions, particularly by expanding and diversifying their European line-ups with the introduction of plug-in hybrids, which remain beyond the scope of EU tariffs.
“China is not only the world leader in BEVs; its automakers are global leaders in plug-in hybrid vehicles too,” Munoz also noted. “To gain traction in Europe, its carmakers have responded to the threat posed by tariffs by focusing on other powertrains, such as plug-in hybrids, to maintain the momentum behind their global expansion plans.”
What’s more, JATO’s analysis for May pinpointed China’s car brands as Europe’s principal drivers of growth, with 65,808 units registered by Chinese automakers during the month, accounting for 5.9 percent of total sales and more than double their market share from the 2.9 percent recorded a year earlier. “Despite the EU’s imposition of tariffs on Chinese electric vehicles, its car brands continue to post strong growth across Europe,” Munoz said of the May results. “Their momentum is partly due to their decision to push alternative powertrains, such as plug-in hybrids and full hybrids, to the region.”
Europe is far from being the only major jurisdiction in which BYD is now outpacing Tesla, as an increasing number of countries see EV sales of the Chinese automaker leapfrog those of its US rival. On July 2, for instance, figures published by the China Passenger Car Association (CPCA) showed that Tesla had finally managed to halt an eight-month declining streak in June when it posted a 0.8-percent annual rise in sales of its EVs manufactured in China. Deliveries of its Model 3 and Model Y units made in its Shanghai factory—including both sales within China and exports to overseas markets—also rose by a hefty 16.1 percent from May to 71,599 units.
Yet sales of its China-made EVs for the April-June quarter still plummeted by 6.8 percent year-over-year, marking the third straight quarter of losses registered by Tesla. What’s more, those figures pale in comparison when stacked up against BYD’s output. Sales for Tesla’s biggest Chinese rival surged by 11 percent year-over-year in June, to 377,628 units, more than half of which were battery-only EVs, with the remainder being plug-in hybrids.
BYD also outsold Tesla in Australia for the first time in June, according to official data (VFACTS) from the Federal Chamber of Automotive Industries (FCAI), noting that BYD registered 8,156 new vehicle sales during the month, a massive 367.9-percent increase year-over-year. This put BYD in fifth position across the country for the month, marking the highest spot ever achieved by a Chinese automaker, as customers particularly went for BYD’s two plug-in hybrid models and the new Sealion 7 electric SUV (sports-utility vehicle).
The UK market initially showed signs of growth for Tesla in 2025, although this bright spot was subsequently quashed in April, when sales of the company’s EVs dropped 62 percent from the previous year. And while BYD remains absent from the US market due to high tariffs on Chinese vehicles making them uncompetitively priced, Cox Automotive nonetheless recently estimated that Tesla’s US vehicle sales fell by a hefty 15 percent during the first half of the year.
Elon Musk’s company remains the highest-selling EV brand in the US, Cox also noted, but its share of the electric-car market has shrunk from more than 75 percent in 2022 to less than 50 percent in 2024, as intensifying competition and growing concerns over the CEO’s recent activities have tarnished Tesla’s brand reputation over the last year or so.
Musk has remained committed to producing just five models under the Tesla name: the Model S, Model X, Model 3, Model Y and Cybertruck. In contrast, BYD produces many more models, most of which are much cheaper than comparative offerings from Tesla. With the Chinese automaker having made giant strides in EV-battery development, such as cars potentially being charged in just five minutes, BYD is increasingly regarded as the key driver of innovation and affordability across the global EV market.
Musk’s heavy participation in the US political sphere between late January and May—particularly his association with the new US federal administration under President Donald Trump—has also polarised the EV-buying public across much of the world. His backing of right-wing politicians and causes, his leadership position at the newly created Department of Government Efficiency (DOGE), which has sought to shrink the federal workforce, and even his call for the United States to exit the transatlantic military alliance NATO (North Atlantic Treaty Organization) have all led to a distinct loss of investor confidence in both Musk and the Tesla brand, prompting existing and potential customers to switch to other brands—BYD included.
After Musk revealed his plans to create a new US political party following his falling out with Trump in a decidedly public spat in early June, further concerns have been raised within investor circles about Tesla’s future growth trajectory. As such, it should come as no surprise that Counterpoint Technology Market Research’s latest Global Passenger EV Forecast, published on April 2, projected BYD surpassing Tesla for the first time as the world’s leading battery EV brand in 2025, capturing a 15.7-percent global market share.
By the fourth quarter of 2024, the Chinese automaker had already overtaken Tesla and is today expected to extend its lead going forward, according to the technology market research firm, which points to BYD’s “aggressive expansion enabled by its tech leadership and vertically integrated production model, all bolstered by strong domestic policy support”, as well as the recent introduction of its ultra-fast charging system as “a pivotal leap in BEV performance, aimed at addressing consumer concerns around charging speed and convenience”.
“We expect Tesla’s global electric vehicle sales to decline by 10 per cent year-on-year in 2025,” market analyst Liz Lee, who serves as an associate director at Counterpoint Research, told The Independent in early July, adding that she expected BYD to experience increased customer deliveries. “We expect BYD’s global EV sales to grow by 45 percent year-on-year in 2025, to reach a record high and significantly outpace most legacy peers.”
