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, three times as much in Q4 2024. For all-battery electric vehicles (BEVs), BYD seized the crown in Q4 2024, though Tesla led by a hair for the year.
Both Tesla and BYD set quarterly delivery records in Q4, but Tesla's annual deliveries fell for the first time.
But Tesla stock, though it retreated on the deliveries miss, has skyrocketed in recent months as investors bet on Full Self-Driving, robotics and AI, with hopes that the incoming Trump administration will greatly favor Elon Musk, a huge campaign contributor and major donor.
Meanwhile, the Model Y refresh was unveiled on Jan. 10, with reports of huge initial demand in China.
BYD stock has been trending lower since early October, but is in a base.
Tesla Vs. BYD Sales
Tesla delivered 495,570 EVs in Q4, up from 462,890 in Q3 and besting its prior record of 484,507 in Q4 2023.
That was below estimates for about 506,000 and implied company guidance of 515,000 or more, despite a slew of discounts and incentives late in the year.
Tesla relied even more in Q4 on China sales, which tend to be lower margin.
Cybertruck deliveries appeared to slow in Q4, even with the shift to the non-Foundation series that cut the starting price to $79,990. On Jan. 1, the dual-motor Cybertruck became eligible for the $7,500 tax credit. That could boost demand, at least in the short run. But Tesla is likely losing money on the new EV at the lower price.
For the full year, Tesla delivered 1,789,226 EVs, down 1% from 2023's 1,808,591. The EV giant, on the Q3 earnings call, had predicted slight delivery growth for the full year.
Tesla also deployed 11 gigawatt-hours of energy storage products in Q4, a new record. It deployed 31.4 GWh for the full year.
Meanwhile, BYD sold a record 1,524,270 vehicles in Q4, up 61% vs. a year earlier and more than triple Tesla's total. Full-year sales jumped 41% to 4,272,145.
Plug-in hybrids led the way in 2024, thanks to BYD's new, longer-range hybrids. But passenger BEV sales ran to 595,413 in Q4, roughly 100,000 more than Tesla. For the year, BYD came in with 1,764,992 BEVs, just shy of Tesla's total.
Tesla will likely regain the BEV title in Q1, 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. Meanwhile, Tesla could suffer a relatively higher drop-off in Q1 as it relies more on China sales.
Tesla Model Y Revamp
On Jan. 10, Tesla launched the long-awaited Model Y refresh in China. The "Juniper" Model Y has a slightly longer range and slightly higher price.
The new MY has has a clearly different front and back, with a light bar similar to that of the Cybertruck, as well as many other EVs.
A Model 3 revamp in late 2023, like the Model S and Model Y updates, didn't provide much of a sales boost. Those refreshes had some real internal improvements but had barely perceptible exterior changes.
There are reports that the new Tesla Y already has more than 50,000 pre-orders.
Deliveries in China are expected to start in March, after the 2025 Lunar New Year holidays. The updated Model Y refresh will also be coming to Europe and the U.S. in 2025, though it's not clear when.
Tesla's 'Affordable' EV
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 a delivery start date 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.
As for the Tesla Semi, the EV giant has delivered a few dozen to PepsiCo. 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.
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 declined as a share of total sales for much of 2024, 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 knockdown plant in Uzbekistan, which puts together partially assembled vehicles.
A Brazil factory is due to fully open in early 2025. The EV giant also is building or plans to build factories in Hungary, Indonesia, Turkey, Cambodia and Pakistan, though some of those would be knockdowns.
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 knockdown plants.
The EV giant has held off on a choosing a Mexico site. BYD may be waiting on Trump developments.
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's New Blade Battery
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 subbrand, Nio's Orvo brand and Toyota. BYD supplies some EV batteries to Tesla Berlin.
BYD reportedly will unveil a next-generation Blade battery in early 2025, with longer range and faster charging. That, along with various other models, could help rev up BEV sales growth.
BYD expects solid-state batteries for high-end models by 2027, but not fully reaching lower-end models until 2030-32.
BYD is a major battery storage provider. It reportedly will be a supplier to Tesla's new Shanghai Megapack factory.
Tesla Full Self-Driving
Around Thanksgiving, Tesla began rolling out FSD v13, which is only available to vehicles with Hardware 4.0.
FSD v13 does appear to show an significant increase in miles per critical disengagement, but it's still a long way from even approaching robotaxi status.
Musk said on the Q3 earnings call that Tesla will achieve unsupervised FSD by mid-2025 in California and Texas. However, 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 (or better) systems there, 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 that 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 that 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. U.S. EV and hybrid sales rose sharply in Q4 for automakers other than Tesla.
Tesla also has a solar installation business, but it's been struggling for years.
Tesla also is pursuing a humanoid robot, Optimus, with Musk 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, helps 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 is starting to filter down to its higher-end BYD-brand EVs.
BYD reportedly aims to start equipping lower-end models with higher-end driver-assistance in 2025.
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.
Trump Election Impact
Elon Musk was a huge supporter of Trump's election bid, contributing hundreds 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 exactly how 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 main hurdle for Tesla robotaxis, which face no such restrictions in states such as Texas and Florida.
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. Tesla China sales also could be hurt, especially if patriotic boycotts or government action against the EV maker takes place.
There is one potential massive wild card. 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 battery and raw material costs, FSD revenue recognition and positive Cybertruck margins were among the factors.
Heavy incentives, lower Cybertruck prices and a much higher mix of China sales suggest margins fell sequentially in Q4.
Tesla will report Q4 earnings on Jan. 29.
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.
BYD may not report Q4 and full-year results until March, but could release preliminary results in late January.
Tesla Stock Technicals
Tesla stock hit a 2024 low of 138.80 in late April, but skyrocketed to 488.54 on Dec. 18. Most of that came after Q3 earnings — with Musk making bullish forecasts about Q4 sales, 2025 growth and robotaxis — but especially after Trump's election.
Shares have pulled back in the past few weeks. Tesla stock tumbled Jan. 2 on the delivery miss but steadied. Shares are below their 21-day line but have found support at their fast-rising 10-week line.
Clearly, investors are largely valuing TSLA stock on moonshots vs. Tesla's current EV business.
BYD Stock Technicals
BYD stock hit a two-year high of 42 on Oct. 7, continuing a breakout from a long consolidation. But shares pulled back significantly over the next several weeks. BYD stock now has a new base with 42 as the official buy point, but is trading below the 50-day line, at three-month closing lows.
Much of the rise and fall in BYD stock follows overall trends in Chinese stocks.
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 $1.27 trillion as of Jan. 10. It's far above BYD's $87.4 billion.
Tesla Stock Vs. BYD Stock
BYD sells far more EVs than Tesla, and has grabbed the lead 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, lasting boost to sales.
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. Even so, BYD regained the BEV crown in Q4.
Tesla stock has surged on Trump's election and optimism about tech breakthroughs. BYD stock has pulled back below key support, but does have a new base.
Keep your eyes on the BYD and Tesla rivalry, as well as the pros and cons of 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.
