China’s BYD poised to overtake Tesla as world’s largest maker of

BYD, already the world’s largest producer of electric vehicles (EVs) – a category that includes plug-in hybrid cars – is poised to gain more bragging rights as global deliveries of its “pure”, battery-powered EVs are expected to have surpassed Tesla’s in the fourth quarter.

The Shenzhen-based carmaker backed by Warren Buffett’s Berkshire Hathaway, handed 526,409 all-electric cars to buyers between October and December, up 22 per cent from 431,603 units in the previous quarter, when it fell just short of Tesla’s 435,059.

Tesla is due to report its fourth-quarter deliveries on Tuesday in the United States.

“BYD’s sales benefited from a rising demand for EVs in China and the discounts it offered to domestic car buyers,” said Gao Shen, an independent analyst in Shanghai. “The new title as the world’s largest pure-electric car builder will hone its image as a global leading player in transforming the automotive industry.”

Tesla’s Gigafactory in Lingang new area of the China (Shanghai) Pilot Free Trade Zone is seen on September 26, 2023. Photo: Xinhua

BYD, known for cars that are priced around 100,000 yuan (US$14,013), dethroned Tesla as the world’s largest EV maker in 2022. The company, controlled by billionaire Wang Chuanfu, delivered a total 1.86 million EVs that year, most of them in mainland China, beating Tesla’s 1.31 million units. But Tesla makes only pure electric cars, so it shipped 43 per cent more of those than BYD’s 917,118.

Tesla’s four models fall into the category of premium EVs, which start at 259,900 yuan in the mainland market.

At present, two out of every five vehicles sold on the mainland are EVs, and EV sales in China – the world’s largest market for such cars – account for about 60 per cent of the global total.

Under the Made in China 2025 industrial strategy, Beijing wants the country’s two top EV makers to generate 10 per cent of their sales overseas by 2025. Though authorities have not named the two companies, analysts believe BYD is one of the two because of its large production and sales volume.

UBS said in September that BYD’s pure electric Seal sedan has a production advantage over Tesla’s Model 3 assembled in mainland China. The cost of building a Seal, a potential rival to the Model 3, is 15 per cent lower, the bank said in a teardown report.

Crunch time for Chinese EV makers amid slowing growth, intensifying rivalry

In Europe, the Seal has a sustainable 25 per cent cost advantage over rivals, even with growing trade barriers such as tariffs factored in, the report added.

The Swiss bank forecast that Chinese-made cars, benefiting from a faster pace of electrification in the world’s largest automotive and EV market, will control 33 per cent of the global market by 2030, up from 17 per cent in 2022.

In the fourth quarter, BYD also delivered 416,242 plug-in hybrid cars, up 6.6 per cent from the previous quarter.

In December, BYD offered discounts of up to 20,000 yuan or 8 per cent on its Han-branded electric sedans to sustain its strong sales growth. Buyers of its Dynasty series EVs, which includes both pure electric and hybrid models, could enjoy discounts of at least 5,000 yuan.

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