ChineseEVmanufacturerBYDreleaseditsrevenuereportforQ32024tobeatoutTesla.ThisisthefirsttimeithasachievedthisfeatinacompetitiveEVmarket.
BYDreportedrevenueof201.1billionyuan(about$28.2billion),whichwassignificantlymorethanTesla’s$25.2billion.
It’sthefirsttimetheBeijing-basedEVproducerisrecordingsuchnumberscomparedtoitsAmericanrival.Ironically,themilestonecomesatatimewhentheEVmarketisonadowntrendinmainlandChina.
WhileBYDoutperformedTeslainrevenue,Teslamaintainsitsleadinprofitability.Tesla’shighernetincomemaybeattributedtoitsfocusonEVsandoperationalefficiencies.
TheAmericanEVcompanyrecordedanetprofitof$2.18billionbetweenJulyandSeptember,up16.2%fromayearago.Meanwhile,itsChinesecounterpart,BYD,sawaprofitincreaseof11.5%inthesameperiodto11.6billionyuan.
Teslaalsoremainsontopinyear-to-datesaleswith$71.98billion,slightlyedgingoutBYD’sestimated$70.53billiontotalrevenue.
AtleasthalfofBYD’ssalesarehybridvehicles,whereasTesla’svehiclesarebattery-only.TheModelYmaintaineditspositionasthebest-sellingbattery-poweredelectriccarinChinainSeptember,withBYD’sSeagulltrailingcloselybehindinsecondplace.
BYDthreatensTesla’sEVdominance
MostofBYD’srecentgrowthwasinspiredbythestrongdomesticdemandthecompanyenjoysinChina.Thediversityofitsproducts,whichincludesbothall-electricvehiclesandhybrids,addstothecompany’sappeal.
ThehybridsegmentissomewhatlesssusceptibletotherecentglobalEVdowntrend,whichmayhavefavoredBYD,asitleverageditsappealtoabroaderconsumerbaseintohighersalesvolumes.
BYD’ssuccessisalsosupportedbyitscostadvantagesviaverticalintegration.Thisallowsthecompanytomanufacturealargepercentageofitscomponentsin-house,savingproductioncostsandenhancingitspricecompetitiveness.
Furthermore,theChinesegovernmentsupportsBYDbyprovidingincentivesforelectricandhybridvehiclesinChina.ThishasbolstereddomesticsaleswhileinsulatingtheChinesecompanyfrominternationalpressureslikerecentEuropeantariffsonChineseEVs.
NewEUtariffsonChineseEVs,hikedupto45.3%,areexpectedtochallengebothcompanies.Theextratariffsrangefrom7.8%forTeslato35.3%forSAICMotors,whichwillcompounda10%standardimportdutyonelectricvehicles.
Theimposedtariffswerereducedfromanearlierproposal,butbothcompanieshavebeenworkingonboostingproductioninEuropetogetaroundtheseduties.
EarlierinOctober,Teslareceivedthego-aheadtodoublethecapacityofitsBerlinplant.Ontheotherhand,BYDannouncedplanstosetupshopinHungarylastyear.InJuly,theChineseautomakerrevealedplanstoinvest$1billionintoaplantinTurkey,whichhasacustomsunionwiththeEU.
Tesla’sChina-madeEVsalessufferedinOctober
Q32024sawBYDbeatTeslaforthefirsttimeinrevenuedespiteTeslaoutsellingitinEVshipmentslastquarter.October,thefirstmonthofthelastquarteroftheyear,wasnotsogreatfortheAmerican-basedcompanyeither.
Teslasoldjustover68,000China-madeelectricvehiclesinOctober,markinga5.3%decreaseyear-on-year,withasignificant22.7%dropindeliveriesfromthepreviousmonth.Meanwhile,BYDsawrecordmonthlysalesof500,526units,a66.2%year-on-yearincrease.
ThedeclineinTesla’ssalescomesamidincreasingcompetitionintheChineseEVmarket,particularlyfromlocalmanufacturerslikeBYD,whicharerapidlyexpandingtheirofferings.
Inabidtoattractmorebuyers,Teslahasextendeditszero-interestfinancingschemeforcertainModel3andModelYvehiclesinChinauntiltheendofNovember.TheschemewasoriginallyintroducedinJuly.
WillthatbeenoughtogiveTeslathatedgeagainstBYDonitsownhometurf?Analystsaredoubtful.Buthey,it’sbusiness,strangerthingshavehappened.
cryptopolitan.com