Tesla may be at the forefront of the electric vehicle revolution in the United States, but abroad the automaker faces stiff competition.Tesla has been losing ground in China, the world’s largest EV market, to domestic automakers that are increasingly making better cars at unbeatable prices, chief among them Warren Buffett-backed of car manufacturers BYD.
BYD overtook Tesla as the world’s largest electric vehicle maker in the fourth quarter of 2023, outselling its U.S. rivals.
“BYD has grown into a giant in the new energy vehicle industry,” said Evelyn Cheng, CNBC’s Beijing correspondent. “When you look at the monthly rankings, they are always at the top.”
BYD, founded by Wang Chuanfu, began producing mobile phone batteries as early as the 1990s. In 2003, the company turned to the automotive field, becoming China’s top car brand and a major producer of electric vehicle batteries.
“They are one of the top companies in the world for making lithium phosphate batteries,” Sam Abuelsamid, principal analyst at Guidehouse Insights, told CNBC. He also explained the advantages over lithium-ion batteries, saying they have a long lifespan and “per kilowatt-hour. Manufacturing costs are reduced by about 30-40%.”
One of BYD’s mass appeals is price. Many of its cars are at a disadvantage against the competition, with some models starting below $20,000.
“They launched Seagull a few months ago in Munich and it was $11,500,” Michael Dunne, CEO of Dunne Insights, told CNBC. “In the U.S. and Europe, you have to double the price and spend a little more to get it. to entry-level cars. So very competitive in the $35,000 and below segment.”
BYD is currently actively expanding globally, exporting more than 240,000 vehicles to 70 countries last year. The company has announced plans to set up a European factory in Hungary and is reportedly looking for a factory in Mexico.
“They are definitely preparing for the U.S. market and waiting for the right moment,” Dunn said. “The United States and Europe provide them with a lucrative market. They have to come in here and compete and win to thrive globally.”
watch video Learn how BYD grew from battery maker to electric vehicle giant and what’s next for the company.
About The Author
