The rise in popularity of electric vehicles in the U.S. has been nothing short of meteoric, with Elon Musk’s Tesla at the forefront of the movement. However, China was a world leader in making and buying electric vehicles before Tesla was even on the map.
China’s leading electric vehicle manufacturer surpassed Tesla in sales in the final quarter of 2023. The Hong Kong-based firm called BYD and Elon Musk’s popular Tesla brand have been running neck and neck for the past few years as Tesla pulled ahead in sales at the beginning of 2024.
China is a Leader in the EV Market
China began investing in EVs in the early 2000s when they were struggling to keep up with foreign car makers who were dominating the vehicle market at the time. Tu Le, managing director of Sino Auto Insights explained, “They realized that they would never overtake the U.S., German, and Japanese legacy automakers on internal-combustion engine innovation” so they turned their focus to research to battery-powered cars.
BYD rose to the forefront of the EV battle, quickly assuming its place among the top 10 automakers in the world. The company already surpassed BMW and Ford, though it trails behind Toyota, Stellantis, and Tesla in market cap value. Tesla’s market cap is around $560 billion, making it the most valuable car company in the world, while BYD sits at $81 billion.
How Does Tesla Measure Up to China EVs?
Tesla has technically been the most valuable car company in the world since 2020. Toyota is in second, followed by Stellantis, Mercedes-Benz, Ferrari and then BYD. While Tesla still sold more cars than BYD in 2023, the gap between the companies has been narrowing since 2021.
The last quarter of 2023 proved to be significant for BYD as they sold more battery electric vehicles than Elon Musk’s company for the first time in history. This was in part due to a dip in interest in Tesla globally as well as some backlash towards EVs in general. Tesla quickly recovered in Q1 of 2024 and surpassed BYD in sales once again.
As it stands, Tesla remains the most valuable car company and the largest provider of battery electric vehicles globally. However, as interest in Tesla remains inconsistent and BYD continues to provide competitive pricing, the Chinese company has an opportunity to overtake Musk’s brand as the number one electric vehicle manufacturer and seller.
