(qlmbusinessnews.com . Mon 6th Jan, 2025) London, UK —
BYD’s Rapid Growth Threatens Tesla’s EV Dominance in 2024
For the first time in over a decade, Tesla experienced a fall in annual sales, with deliveries dropping to nearly 1.79 million vehicles in 2024, a slight decline from the 1.8 million sold in 2023. Despite aggressive price reductions throughout the year to sustain its lead as the world’s top electric vehicle (EV) manufacturer, the company led by Elon Musk has seen its position increasingly challenged.
China’s BYD is closing the gap, reporting 1.76 million EV sales in 2024. The Shenzhen-based firm’s overall vehicle sales surged by 41% year-on-year to exceed 4.2 million, driven largely by hybrid models. BYD dominates the Chinese market, accounting for 90% of its sales locally. Government subsidies, competitive pricing, and a rising demand for energy-efficient vehicles have all contributed to BYD’s rapid growth.
Tesla, which also counts China as a critical market, has struggled to maintain momentum amid fierce competition. The ongoing price war, coupled with weaker demand in regions like the US and Europe, has added pressure. Rivals such as Volkswagen, Ford, and General Motors have also scaled back EV sales targets, citing challenges in the market.
Elon Musk has attributed Tesla’s difficulties to rising borrowing costs since 2022, which have increased the expense of vehicle purchases. Analysts, however, suggest that growing competition and Musk’s politically charged public presence have impacted the brand’s appeal.
Tesla’s sales began recovering in the second half of 2024, achieving a record 495,000 deliveries in the final quarter—a 2% year-on-year increase. Yet, this fell short of analyst expectations of 500,000, leading to a 5% drop in Tesla’s share price despite a strong 60% rise in stock value over the year.
Meanwhile, the global car industry is witnessing other significant shifts. Japanese automakers Honda and Nissan are reportedly in merger talks to counter competition from Chinese manufacturers, and Stellantis CEO Carlos Tavares recently resigned following a boardroom dispute.
Governments have also intervened to shield domestic industries. The European Union has implemented tariffs of up to 45.3% on Chinese-made EVs, while the US has imposed a 100% duty on similar imports, with more measures expected.
BYD continues to expand into emerging markets but recently faced scrutiny in Brazil, where authorities halted construction of a new factory due to allegations of worker mistreatment. BYD has since severed ties with the contractor involved, reaffirming its commitment to adhering to Brazilian labour laws.
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