Business

BYD Surges in EV Sales as it Closes Gap with Tesla in 2024

Chinese automobile manufacturer BYD experienced a significant surge in sales at the end of last year, as it vies with Tesla to become the world’s leading electric vehicle (EV) producer in 2024.

The company reported sales of 207,734 EVs in December, bringing its annual total to 1.76 million units, spurred by subsidies and discounts that attracted a large customer base.

Meanwhile, Tesla will reveal its quarterly sales figures later on Thursday. In the previous quarter, Tesla held a marginal lead over BYD in EV sales, but the Shenzhen-based company has been steadily closing the gap.

BYD’s overall vehicle sales increased by more than 41% year-on-year in 2024, driven primarily by strong sales of its hybrid vehicles.

The company has benefitted from a rise in car sales in its domestic market, as intense competition has driven down prices, and government subsidies have encouraged consumers to replace older cars with EVs or other more fuel-efficient options.

BYD sells 90% of its vehicles in China, where it continues to extend its lead over foreign brands such as Volkswagen and Toyota. The success of BYD and other Chinese EV manufacturers contrasts sharply with the challenges faced by traditional car makers in major Western markets. Last month, Honda and Nissan confirmed they were in merger discussions as the two Japanese firms sought to counter competition from the Chinese car industry.

In December, Volkswagen announced an agreement with the IG Metall trade union, averting plant closures in Germany and avoiding immediate compulsory redundancies. The German automotive giant had previously warned it might have to close plants to reduce costs.

Earlier in the month, Carlos Tavares, CEO of car manufacturing giant Stellantis, resigned with immediate effect following a boardroom dispute. His sudden departure came two months after Stellantis issued a profit warning. Stellantis owns brands including Vauxhall, Jeep, Fiat, Peugeot, and Chrysler.

In the third quarter of 2024, BYD’s revenues surged, surpassing Tesla’s for the first time. BYD reported over 200 billion yuan (£21.8 billion) in revenues between July and September, a 24% increase from the same period last year, compared to Tesla’s quarterly revenue of $25.2 billion.

However, Tesla still sold more electric vehicles than BYD.

Chinese car manufacturers have been attempting to increase their EV sales outside of China but have encountered resistance in some major markets.

In October, the European Union imposed tariffs of up to 45.3% on imports of Chinese-made EVs. The US has also implemented a 100% duty on Chinese EVs, and President-elect Donald Trump is expected to impose additional tariffs on imports.

Meanwhile, BYD has been expanding its presence in emerging markets. Last month, the company faced a setback in Brazil, its largest overseas market, when authorities halted the construction of a BYD factory, citing conditions akin to “slavery” for workers. BYD stated it had severed ties with the construction firm involved and reaffirmed its commitment to “full compliance with Brazilian legislation”.

Frances Ibiefo

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Frances Ibiefo

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