In a surprising turn of events, Chinese automaker BYD has emerged as the leader in electric vehicle (EV) sales, dethroning Tesla in the last quarter of the year. BYD reported sales of 526,409 all-electric cars, surpassing Tesla’s 484,507 vehicles. Both companies exceeded their annual estimates, with BYD reaching over 3 million and Tesla hitting 1.8 million cars sold in 2023.
BYD’s stellar performance in the last quarter, where it sold 942,651 cars, marked a record-breaking achievement. Of these, 55% were fully electric (BEV), and 45% were plug-in hybrids (PHEVs). Notably, the company ceased production of internal combustion engine (ICE) vehicles in April 2022, focusing solely on electric options.
Throughout 2023, BYD sold a total of 3,023,679 electric vehicles, marking a remarkable 62% increase from the previous year. Approximately 52% of these were BEVs, totalling 1,574,804 units. Meanwhile, Tesla delivered 1,808,581 vehicles in 2023, showing a 38% growth from the previous year. Although Tesla still holds the crown for cumulative sales in 2023, BYD appears poised to remain the leading EV maker through 2024.
Founded initially as a battery company, BYD entered the automotive scene in the mid-2000s, backed by Warren Buffet. Despite comparisons with Tesla, the two companies differ significantly in their product offerings and business philosophies. Unlike Tesla’s online direct sales model, BYD relies on a vast dealer network for both international expansion and domestic sales.
BYD’s commitment to its dealership model is evident in its recent move to rebate 2 billion yuan (USD 280 million) to its dealers as a reward for achieving the goal of selling 3 million vehicles in 2023. Each dealer will receive 666 yuan (USD 93) for every car sold last year.
In terms of design and features, BYD cars differ from Tesla, sporting a more traditional interior with physical buttons. The company focuses on providing cost-effective vehicles with substantial value rather than investing heavily in advanced driver-assistance systems (ADAS) or high-end autonomous driving capabilities.
BYD’s CEO, Wang Chuanfu, shares a cost-cutting philosophy with Tesla’s Elon Musk, emphasising efficiency and low car prices. The company maintains a high level of vertical integration, owning its lithium mines, producing its cells and batteries, and managing car-making plants, shipping carriers, and car insurance companies.
Looking ahead to 2024, BYD is set to explore new avenues. The company introduced two new EV brands in 2023 – YangWang and Fang Cheng Bao – adopting a direct sales model and establishing its sales network. BYD has also started investing in self-developed ADAS and autonomous driving systems, marking a shift away from its previous agreement with Baidu Apollo. With expansion plans and a growing focus on innovation, BYD aims to continue its ascent in the competitive electric vehicle market.
