Tesla and BYD are the world's largest electric-vehicle makers.
In 2022, China EV and battery giant BYD's vehicle sales raced ahead of Tesla's and are now well more than twice as high. For all-battery electric vehicles (BEVs), BYD seized the crown in Q4 2023. Tesla has regained that title, though BYD looks set to lead again in Q4 2024.
Tesla reported a surprise profit gain in Q3, fueled by rebounding margins. Elon Musk was bullish about full-year and 2025 growth as well. BYD reported solid Q3 earnings, with revenue surpassing Tesla for the first time. October and November sales signal a huge fourth quarter.
Tesla is rolling out its latest big update to Full Self Driving.
But for Tesla and perhaps BYD, the biggest news is Donald Trump's election. Investors are convinced that Trump policies will strongly favor Tesla, with Musk a strong campaign supporter and now co-leading a blue-ribbon government efficiency effort. Meanwhile, Trump has promised massive new China tariffs, hitting an already-struggling Chinese economy.
There is a potential Trump wildcard that could up-end the calculus for both EV giants.
Tesla stock skyrocketed after U.S. elections to a two-year high. BYD stock has fallen below a key level.
Tesla Vs. BYD Sales
Tesla delivered 462,890 EVs in Q3, up from Q2's 433,956 and Q3 2023's 435,059. That was in line with various analyst estimates but below some whisper numbers. Also, Tesla relied on China sales, which tend to be lower margin.
Tesla also deployed 6.9 gigawatt hours of energy storage products, down from Q2's record 9.4 GWh.
Meanwhile, BYD sold a record 1,134,892 vehicles in Q3, up 37.3% vs. a year earlier and 7.6% vs. Q2's 986,720. Plug-in hybrid sales soared 75.6% vs. a year before to 685,830. BEV passenger sales came in at 443,426, up 2.7% vs. a year earlier and 4.1% vs. Q2.
Tesla, which only makes BEVs, remained No. 1 in that category in Q3.
In November, BYD sold a record 506,804 EVs in November, up 67.9% vs. a year earlier. But it was up just 0.8% vs. October and below some estimates.
Out of its 504,003 passenger vehicles, BYD sold 305,938 PHEVs, up 133.1% vs. a year earlier but down 1.6% from October. That snapped an eight-month string of record PHEV sales. BEVs sales came in 198,065, their first record of 2024. They were up 16.4% vs. a year earlier and 4.5% vs. October.
Sales of commercial vehicles, including buses, delivery trucks and more, hit a record 2,801 in November, up 433.5% vs. a year earlier and 31.4% vs. October.
So far in 2024, BYD has sold 3,757,336 vehicles. It's now passed the official full-year target of 3.6 million EVs in November and should end the year well above the unofficial goal of four million.
BYD Eyes BEV Crown
On the Q3 earnings call, Musk predicted 2024 deliveries would top last year's total of 1.808 million. That would require record Q4 deliveries of more than 514,925. Right now analysts are predicting around 500,000 in Q4, even with Tesla pushing hard with a vast array of incentives and discounts.
BYD's sales are likely to keep rising in the typical year-end push. But simply the October-November levels would mean BYD's BEV sales would total 581,518 in Q4.
In all likelihood, Tesla would regain the title in Q1 2025, with Lunar New Year holidays contributing to a sluggish period for China auto sales. But strong orders and expanding overseas operations suggest BYD won't suffer nearly as big of a drop-off in Q1 2025 as it did to start 2024.
Tesla, BYD Price Cuts
Tesla has slashed prices worldwide starting in late 2022. The EV giant has had to keep cutting prices or boost other incentives to prop up sales, slashing once-mighty profit margins and earnings.
In late October, Tesla increased Model 3 and Model Y inventory discounts in the U.S. and announced 0% financing for those EVs. In recent weeks, Tesla has announced free Supercharging and FSD incentives, higher referral bonuses and end-of-lease buyouts in the U.S. In Europe, Model 3 and Y incentives have grown. It also recently announced an end-of-year Model Y price discount.
Earlier in 2024, BYD slashed prices on most of its largely refreshed models, helping to revive sales, but since then has largely eschewed discounts.
Tesla Models
Tesla produces the Model 3, the Model Y, Model X and Model S, as well as the Semi and Cybertruck. The Model Y crossover accounts for the majority of sales.
A Model 3 revamp didn't provide much of a sales boost in China and Europe and has been lackluster in the U.S.
Cybertruck production has picked up. It's likely to be largely a North American vehicle.
Tesla is now selling non-Foundation versions of the Cybertruck in the U.S., reducing the starting price by $20,000, to $79,990. At that price, the Cybertruck should soon be eligible for IRA tax credits. But that still hasn't happened.
Anyone can order a Cybertruck with near-term delivery. Tesla is now trying to generate Cybertruck sales in Canada and a few other countries.
All that suggests that the estimated 2 million reservations didn't translate into many sales.
Along with other efforts, Tesla's Cybertruck moves reflect a hard push for year-end sales.
Tesla has delivered a few dozen Semi vehicles to PepsiCo. By May 2024, a few more customers, including Walmart, had taken possession of at least one Tesla Semi. But it's still unclear what the specs and price for the EV big rig are. Tesla recently said it expected mass production in 2026, but Semi timelines have often slipped by years.
Tesla Model Y Refresh, 'Affordable' EV
Recent online chatter suggested that Tesla Shanghai was starting low-level production of the long-awaited updated "Juniper" Model Y. That might indicate actual deliveries in China by early 2025. It's unclear when Tesla's Berlin and Austin plants might begin output.
Like the Model S, X and 3 updates — which didn't boost sales much — the "Juniper" Model Y likely will have cosmetic exterior changes. Even a small but noticeable exterior change could help.
The EV giant this year ditched long-touted plans for a "next-generation" EV and "revolutionary" manufacturing. Tesla now plans "affordable vehicles," using existing production lines.
In the Q3 earnings report, Tesla said it still sees output of the "affordable" vehicle starting in the first half of 2025. That would suggest mass production and deliveries would start in late 2025 or beyond.
Musk, on the Q3 call, said the new EV should be sub-$30,000 after incentives. If that means the $7,500 IRA tax credit, the list price would be below $37,500, but perhaps not by much.
Tesla still hasn't even shown images for the upcoming "affordable" vehicle.
The speculation is that Tesla will produce a lower-cost variant of the Model 3 or Model Y, perhaps a hatchback. It's unclear how a low-end EV might fare in various markets, especially in China, without IRA credits.
BYD Expansion
BYD sells BEVs and PHEVs from around $10,000 to $150,000, with a wide range of models. It's refreshing much of its lineup, while adding several new models. That includes new models for its premium Denza, FangChengBao and Yangwang brands.
BYD recently took full control of Denza, buying the last 10% owned by Mercedes-Benz.
A recently launched fifth-generation hybrid system offers touted 2,100 kilometers (1,305 miles) in combined battery-and-gas range. The system, which is being rolled out to new and existing models, is fueling booming orders.
Improved driver-assist systems and faster charging also are expanding to more of BYD's lineup.
Overseas sales have declined as a share of total sales in recent months, but BYD has big plans.
Export logistics have improved, in terms of ships and rail.
BYD's brand-new Thailand plant, its first full-assembly plant outside of China, has begun deliveries. There's also a knock-down plant in Uzbekistan, which puts together partially assembled vehicles.
A Brazil factory is due to fully open in early 2025. The EV giant also has intents to build factories in Hungary, Indonesia, Turkey, Cambodia and Pakistan.
Turkey has a customs union with the EU. That, along with the Hungary plant, will be two factories for Europe. The Cambodia and Pakistan plants will likely be knock-down plants.
The EV giant also is close to choosing a Mexico site and may set up in Vietnam as well. BYD may be waiting on Trump developments before selecting a Mexico site.
BYD makes EV buses in California, but says it has no plans to enter the U.S. passenger EV market, amid import tariffs and political opposition. However, Trump has said he wants Chinese EV makers to build cars in the U.S.
Tesla Vs. BYD Batteries
Tesla traditionally has not mass produced its own batteries. For lithium-ion batteries, its joint venture partner Panasonic makes the cells and Tesla packages them. It also buys lithium-ion batteries from South Korea's LG. Tesla also buys a lot of lithium iron phosphate (LFP) batteries from China's CATL as well as some LFP batteries from BYD.
Tesla is working on 4680 batteries, first touted at the 2020 Battery Day. The 4680 batteries are standard lithium-ion chemistry, but the EV giant claimed the larger form factor offers the potential for various benefits and cost savings. Tesla's 4680 production has picked up in recent months.
Tesla has hinted at progress on the "dry cathode" problem, but reportedly mass-production issues remain. It appears that the 4680 battery density is only now reaching that of traditional 2170 cells. Tesla does get some IRA tax credits from making its own batteries.
Tesla is a major battery storage provider, though it gets its batteries from CATL.
BYD, meanwhile, is one of the world's largest EV battery makers. Its Blade batteries are a specialized form of lithium ferrous phosphate (LFP) or lithium iron phosphate batteries. BYD supplies third-party EV makers, including Xiaomi, XPeng's Mona sub-brand, Nio's Orvo brand and Toyota. BYD supplies some EV batteries to Tesla Berlin.
BYD reportedly will unveil a next-generation Blade battery in 2025, with longer range and faster charging. That, along with various other models, could help rev up BEV sales growth next year.
BYD expects solid-state batteries for high-end models by 2027, but not fully reaching lower-end models until 2030-2032.
BYD is a major battery storage provider. It reportedly will be a supplier to Tesla's upcoming Shanghai Megapack factory.
Tesla Full Self-Driving
Around Thanksgiving, Tesla began rolling out FSD v13 to employees and at least some outside customers. The EV giant has claimed a six-times improvement with the latest upgrade in terms of miles driven without a human intervention.
Right now, FSD v13 appears to be a limited version, but has the ability to unpark, reverse, and park.
Musk said on the Q3 earnings call that Tesla will achieve unsupervised FSD by mid-2025 in California and Texas He's said for years that Tesla would achieve self-driving "this year" or "next year."
At the Tesla robotaxi event, Elon Musk showed off the two-seat Cybercab, with butterfly doors and no steering wheel. Musk expects the Cybercab price tag will be below $30,000, with production starting "before 2027."
Tesla is moving toward offering FSD in China. But many automakers offer Level 2 systems there, or better, often at no cost.
Tesla has slashed the FSD price to $8,000 from $12,000 and a peak of $15,000. That came after halving the FSD subscription price to $99 a month from $199.
On the Q3 earnings call, Musk conceded for the first time Tesla EVs running Hardware 3.0 may not ever achieve FSD, despite Musk's past pledges that they were "hardware ready."
Tesla's Other Businesses
Tesla has its own Supercharger network in its markets. That's especially important in the U.S., where third-party charging facilities are limited.
Tesla has deals with most automakers for access to Superchargers in the U.S. They'll also adopt the charger standard Tesla uses. Those deals, and some related charging subsidies, will boost revenue. But they reduce Tesla's charging moat in the U.S., which encouraged people to buy its EVs.
Tesla also has a solar installation business, but it's been struggling for years.
Tesla's self-driving ambitions continue. Musk is doubling down on FSD.
Tesla also is pursuing a humanoid robot, Optimus, saying he expects it to be a multitrillion dollar business. He showed off many Optimus robots at the Oct. 10 robotaxi events, but they were largely teleoperated.
"We should be thought of as an AI or robotics company," Musk has told investors. "If somebody doesn't believe Tesla is going to solve autonomy, I think they should not be an investor."
BYD's Other Businesses
BYD, notably, makes its own chips. That, along with in-house batteries and other vertical integrations, help make BYD a low-cost EV maker.
The EV and battery giant also has solar operations.
BYD is introducing Level 2 driver-assistance systems in its premium brand models as well as more mainstream BYD brand offerings. Those services have been introduced in the premium Denza line and starting to filter down to its higher-end BYD-brand EVs in the coming months.
BYD reportedly aims to start equipping lower-end models with higher-end driver-assistance next year.
BYD Co. is largely known for its BYD Auto operations. BYD Electronics, which accounts for an increasingly smaller share of overall revenue, is involved in mostly low-margin businesses such as smartphone components and assembly. But margins are improving there as well.
EU Hikes Tariffs On Chinese EVs
The European Union has started imposing additional tariffs of up to 35.3% on Chinese BEVs. That's on top of the current 10% duties.
Specifically, the EU will impose an extra 17% tariff on BYD's BEVs. But, the new duties don't apply to PHEVs, a big plus for BYD.
Notably, the EU will only impose a 7.8% extra tariff on Tesla's China made-vehicles. Tesla Shanghai exports the Model 3 to the EU. The EV maker in July hiked Model 3 prices in Europe slightly, further weighing on sales there amid big declines in overall EV sales.
Trump Election Impact On Tesla, BYD
Elon Musk was a huge supporter of Trump's election bid, contributing tens of millions of dollars and actively campaigning with the former president.
President-elect Donald Trump named Elon Musk and Vivek Ramaswamy to lead the Department of Government Efficiency (DOGE) to "dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures and restructure Federal Agencies."
There's widespread hope that Trump's presidency will help Tesla, though that is unclear.
Trump has said he wants to eliminate IRA tax credits, including the $7,500 tax credit on EVs.
Eliminating the EV credit — which needs congressional action — would hit Tesla's U.S. margins and sales, especially for the upcoming "affordable" vehicle. It might reduce traditional automakers' EV efforts over time. However, Calif. Gov Gavin Newsom says if IRA tax credits are scrapped, he'll reintroduce credits in the EV-heavy state, but with market share limits that exclude Tesla.
Team Trump also is mulling a rollback of fuel-economy and emission standards. That would reduce the de facto mandate for EVs. However, California and some other blue states have implicit or explicit EV mandates, so GM, Ford and others might continue to push ahead with EVs. Reducing fuel-economy standards also would reduce traditional OEMs' need to buy zero emission credits from Tesla.
Trump's transition team reportedly wants a federal framework for self-driving vehicles, something Musk has argued for. But regulation isn't the hurdle for Tesla robotaxis, which face no such restrictions in states such in Texas and Florida.
However, the risk that federal regulators could impose serious penalties or restrictions over Tesla's self-driving systems and claims has probably been lifted.
Meanwhile, Trump has threatened to impose 60% tariffs on China, and said in late November that he would impose an immediate 10% hike on his first day in office. That wouldn't have much impact on BYD directly, but would hit China's economy, where BYD gets nearly all its sales. Tesla China sales also could be hurt, especially if patriotic boycotts or government action vs. the EV maker takes place.
There is one potential massive wildcard. Trump has voiced his support for Chinese EV makers setting up plants in the U.S. If he did so as president, BYD would likely rush to take advantage. That would have serious implications for Tesla.
Tesla Earnings
In the third quarter, Tesla earnings unexpectedly rose 9% vs. a year earlier, snapping a four-quarter string of declines. Revenue climbed 8% to $25.2 billion, slightly missing.
But gross margins jumped to 19.8%, up 195 basis points vs. a year earlier. Record Tesla Energy margins, lower raw material costs, FSD revenue recognition and positive Cybertruck margins were among the factors.
Heavy Q4 incentives and lower Cybertruck prices suggest margins could fall sequentially in Q4.
BYD Earnings
BYD's Q3 earnings rose 16%, slightly above views. Sales jumped 29% to $28.7 billion, with growth accelerating for a second straight quarter but just missing views. However, BYD revenue topped Tesla's for the first time.
BYD's gross margin was 21.89% vs. 18.96% a year earlier. BYD Auto margins popped to 23.51% vs. 22.51% in Q3 2023.
R&D and capital spending costs continue to climb rapidly.
Tesla Stock Technicals
Tesla stock is up 38.9% so far in 2024 as of Nov. 29, according to MarketSurge analysis.
Shares spiked 29% in the week ended Nov. 8, turbocharged by Trump's election, blasting out of a base to a two-year high. Shares paused last week as the broader Trump trade faded and investors mulled the implications of losing EV credits in the U.S. But they are back near recent highs.
Shares are holding right around recent two-year highs.
Tesla stock rose modestly Monday amid the FSD v13 rollout.
BYD Stock Technicals
BYD stock is up 19% in 2024 through Nov. 29.
In early October, BYD topped the official 36.27 buy point, and quickly hit a two-year high of 42 before pulling back. Shares now appear to be forging a new base, which could be viewed as a double-bottom with a 39 buy point. But shares are currently below their 50-day line, riding a five-week losing streak.
Much of BYD's recent rise and fall reflected hopes and disappointment over China stimulus hitting Chinese stocks broadly, as well as Trump tariff fears.
Shares rose slightly on Dec. 2.
BYD, listed in Hong Kong and Shenzhen, trades over the counter in the U.S. Its U.S. shares often have mini-gaps as well as opening trade mini-spikes or tumbles before settling down.
Tesla Vs. BYD Market Cap
Tesla stock has a market cap of $1.11 trillion as of Nov. 29. It's far above BYD's $89.9billion.
Tesla Stock Vs. BYD Stock
BYD sells far more EVs than Tesla, though the latter still leads in BEVs, at least for now. More broadly, BYD in many ways is the EV maker Tesla has claimed or aspired to be. BYD makes its own batteries and chips, and sells those batteries to third parties such as Tesla. Musk has talked about making a $25,000 Tesla, though he dismissed the idea on the Q3 earnings call. BYD makes EVs profitably at far below $25,000.
The Tesla Cybertruck is relatively new, but shipments are still low. It's unclear if yet-unseen upcoming "affordable" variants of aging vehicles will have a meaningful impact, or if the Model Y refresh will have a big, last impact.
BYD has entered most of the world outside of the U.S. Its model lineup continues to expand dramatically, with big moves upscale and adding tech to its more-affordable offerings.
BYD's broad lineup and next-generation hybrid system means it's reaping the benefits of a global shift toward PHEVs over BEVs. Even so, BYD seems on track to regain the BEV crown in Q4.
Tesla stock has surged on Trump's election, extended from any buy point. BYD stock has pulled back below key support, but does have a new base.
Keep your eyes on BYD and Tesla, as well as Tesla stock vs. BYD stock.
Please follow Ed Carson on X/Twitter at @IBD_ECarson and Threads at @edcarson1971 for stock market updates and more.
