Tesla loses global electric vehicle crown to BYD
Tesla ceded the title of the world’s top electric vehicle maker to BYD after annual sales fell for a second year due to increased competition, the expiration of US tax credits and brand backlash.
While global EV sales increased by 28 percent last year, BYD surpassed Tesla on an annual basis for the first time; This was helped by rapid growth in Europe, where the Chinese automaker has widened its lead over its US rival.
Tesla faces intense competition, especially in Europe, with sales falling about 8.6 percent in 2025, raising questions about its ability to revive its core auto business as CEO Elon Musk steers the company towards robotaxis and humanoid robots.
The company’s shares were down more than 1.0 percent in Friday morning trading on Wall Street.
“Investors are so focused on Tesla’s future that they ignore delivery numbers. It’s about Optimus, Robotaxi and physical AI,” said Dennis Dick, a trader at Triple D Trading, which owns Tesla shares.
Tesla’s fourth-quarter figures come after third-quarter deliveries were boosted by a rush to lock in $US7,500 ($A11,221) in federal tax credits after US President Donald Trump’s administration decided to pull the plug on stimulus in September.
Tesla said it delivered 418,227 vehicles in the October-December quarter, a 15.6 percent decrease from 495,570 a year earlier.
Analysts were expecting a decline of 434,487 vehicles, or 12.3 percent, according to Visible Alpha.
For the entire year, Tesla delivered 1.64 million vehicles, compared to 1.79 million in 2024.
Analysts surveyed by Visible Alpha had expected deliveries of about 1.65 million vehicles, marking the company’s second consecutive annual decline.
Tesla reached its peak in 2023, delivering more than 1.8 million vehicles.
The drop in deliveries isn’t a big surprise, given the market is already pricing in weak demand after U.S. EV tax credits expire, said Seth Goldstein, senior equity research analyst at Morningstar.
Meanwhile, Tesla said it used a record 14.2 GWh of energy storage products.
It will announce its fourth quarter results on January 28.
Increasing competition from Chinese and European automakers such as BYD, Volkswagen and BMW has weighed on Tesla’s sales momentum.
BYD said sales outside China rose to a record one million vehicles in 2025, up nearly 150 percent from 2024.
The company said it aims to sell up to 1.6 million vehicles outside China in 2026, although it did not announce an overall sales target.
BYD sold a total of 4.6 million vehicles in 2025, an eight percent increase compared to the previous year.
These included 2.3 million battery electric vehicles, up 28 percent annually, according to the automaker.
Tesla launched stripped-down “Standard” versions of the Model Y and Model 3 in October, priced about $5,000 below previous base models, as it tried to maintain sales volumes after the loss of tax credits and appeal to customers looking for cheaper options in Europe.
The move disappointed some investors who were expecting a bigger price cut or a meaningful new mass-market product.
Even as vehicle deliveries weaken, Tesla shares are up about 11.4 percent in 2025.
with DPA
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