BYD Chalks Up New Record As It Narrows EV Sales Gap With Tesla

(Bloomberg) -- China's BYD Co. enjoyed a year-end surge to push total sales to 4.25 million passenger cars last year, narrowing its gap with Tesla Inc. as the two vie for the crown of top-selling electric-vehicle maker of 2024.

The Shenzhen-based carmaker, which stopped making vehicles entirely powered by fossil fuels in 2022, hit a new monthly sales record in December, spurred on by subsidies and offering extra incentives to buyers.

BYD sold 509,440 plug-in hybrid and pure-electric passenger vehicles in December, the company said Wednesday. The figure includes 207,734 EVs, taking the annual tally of battery-powered car sales to 1.76 million. Overall annual sales increased 41% year-on-year.

The rise of BYD as a best-selling car brand stands in contrast to the turmoil facing a growing number of legacy auto giants like Nissan Motor Co., Volkswagen AG and Stellantis NV. Western car brands have faced tumbling sales in China, while also lagging behind on the EV transition.

Tesla Target

Tesla will unveil its fourth-quarter sales figures later this week. The Elon Musk-led company needs to deliver at least 515,000 EVs in the final three months of 2024 to meet its guidance for “slight growth” in annual sales, or 1.81 million deliveries, which would be a quarterly record for the company. Analyst estimates are for 510,400 deliveries, just shy of Tesla's expectations.

BYD has trailed Tesla in quarterly sales this year. By the third quarter, BYD had sold 1.16 million EVs, lagging Tesla by 124,100. However, the Chinese best-seller has seen a last-quarter surge to narrow the gap with its US rival.

On BYD's December data, it will fall just shy of surpassing Tesla in annual sales. It has only topped Tesla once — on a quarterly basis in the final three months of 2023. 

New Milestones

BYD's surge will help cement its place among the top-selling carmakers globally. Its rise in total sales puts it near to beating Ford Motor Co. and Honda Motor Co. on an annual basis too. Higher sales will tip the company's annual revenue over $100 billion for the first time.

BYD's gains have been fueled by domestic Chinese sales — and aided in the second half of the year by increased subsidies to convince drivers to ditch gasoline cars.

Its target to sell roughly half-a-million vehicles outside China has fallen short of expectations in the face of pushback from the European Union, which has imposed additional tariffs on Chinese EVs.

In Brazil, one of its biggest overseas markets, BYD is under scrutiny over allegations of slave-like conditions for some construction workers building a new EV factory.