With BYD reporting revenues of $107 billion in 2024, exceeding Tesla’s $97.7 billion, it is expected to surpass Tesla in global market share in 2025 (15.7% versus 15.3%, according to this month’s forecast by Counterpoint Research).
BYD has already outsold Tesla in the past two quarters. In the first quarter of 2025, it sold 416,000 battery electric vehicles, up 39% from the same period last year, compared to Tesla’s 336,681 vehicles, down 13%. In 2024, it exported 417,204 units, up 71.9%, with ambitions to double it to over 800,000 this year.
Counterpoint attributed this growth to BYD’s “tech leadership and vertically integrated production model, all bolstered by strong domestic policy support”. Its vertically integrated production model gives it a significant cost advantage. In 2023, UBS conducted a teardown of the BYD Seal sedan and found that about 75% of its parts were made in-house, compared to 35% in the case of Volkswagen. Even where it relied on third-party suppliers, it was primarily domestic. BYD cars cost about 30% less to assemble than comparable models from Western companies, UBS said.
BYD has passed on the benefits to customers. Last month, Rest of the World reported that BYD’s lowest cost option was cheaper than Tesla’s in at least 10 markets where they compete. In China, Tesla’s most affordable model is priced at $32,438, while BYD’s is priced at $9,614 per unit.
Also Read: Mint Quick Edit | BYD has leapt ahead on charging speed
R&D Push
BYD is capturing the market not just with lower prices, but also with features. The company initially started as a battery manufacturer in 1995. Battery technology has remained one of its core strengths. It is known for its Blade Battery, a lithium iron phosphate (LFP) battery that promises improved safety and energy efficiency. Last month, it introduced a charging system that, it claims, can add 400 kilometres of range in just five minutes (against Tesla’s Superchargers, which take 15 minutes to add 275 km).
In February, BYD said it would make its “Eyes of God” driving-assistance software available in all models, including one priced under $10,000, at no extra cost for most models. (Tesla charges subscription fees for a similar system.) All these were driven by its research & development push. Its CEO Wang Chuanfu said the company had the largest R&D staff among automotive companies and filed 32 patent applications every working day.
Wider Range
BYD’s R&D investments are one of the series of strategic calls taken by Chuanfu over the years, often in the face of investor scepticism. Its foray into automobile manufacturing followed the acquisition of a struggling state-run car company in 2003. Investors saw it as a diversion from its core battery manufacturing. However, by 2008, Warren Buffett’s investment firm Berkshire Hathaway invested about $230 million in the company, which gave it global credibility and boosted investor interest.
In 2008, it launched its first plug-in hybrid electric vehicle (PHEV), and two years later, its first fully battery-electric vehicle (BEV). It stopped producing ICE vehicles in 2022 to focus on EVs. Offering both PHEVs and BEVs helped BYD cater to a wider range of customers, including those reluctant to go fully electric. While BEVs have a bigger share in new sales, PHEVs showed stronger growth in China, with registrations growing 80% in 2024 (compared to BEVs’ 17.3%).
Beyond China
While China remains the world’s largest market for EVs, it is also becoming one of the most competitive, accelerating BYD’s global ambitions. It could also expand its margins (currently lower than Tesla’s) as it pushes its most premium offerings, Denza and Yangwang, in Europe. Its flagship store in London is in the vicinity of Rolls-Royce, Ferrari and Bentley. However, amid intensifying trade wars, it faces challenges. The US has imposed a 100% tariff on Chinese EVs and Europe 27%.
It is seeking alternate markets in Southeast Asia and South America, along with manufacturing plants. It wants to be in India but has received a cold shoulder so far. In 2023, the government rejected its proposal to set up a $1 billion factory in partnership with Hyderabad-based Megha Engineering and Infrastructure. That stance has not changed. Even as it waits on India, BYD is going places elsewhere.
www.howindialives.com is a database and search engine for public data
