BYD Hits Sales Goal, Set to Topple Tesla as Biggest EV Maker

Core Viewpoint - BYD Co. has met its full-year sales target and is likely to surpass Tesla to become the world's largest electric vehicle maker by 2025, despite facing a challenging outlook for the Chinese auto market in the upcoming year [1] Sales Performance - BYD delivered a total of 4.6 million vehicles in 2025, marking a 7.7% increase from 2024, aligning with the company's revised full-year goal set in September [2] - The company sold approximately 2.26 million fully electric vehicles, nearly matching its plug-in hybrid sales [2] Competitive Landscape - Tesla is expected to report around 440,900 vehicle deliveries in Q4, reflecting an 11% decline year-over-year, leading to an estimated total of 1.66 million cars sold for the year, marking its second consecutive annual drop [3] - BYD faces increasing competition from Geely Automobile Holdings Ltd. and Xiaomi Corp., which are gaining consumer interest through new models and innovations [5] Market Challenges - The Chinese EV market is expected to experience pressure as the government reduces incentives for EV purchases, and an influx of new models intensifies domestic competition [4] - Trade barriers are also posing challenges for BYD's ambitions to expand internationally [4] Technological Advancements - BYD's CEO Wang Chuanfu indicated that the company's previous technological advantages have diminished, impacting domestic sales, but expressed confidence in upcoming technological breakthroughs due to a strong engineering team [6] International Sales Growth - A positive development for BYD has been its overseas sales, which reached 1.05 million in 2025, surpassing the high-end estimate of 1 million, helping to mitigate the decline in its core market [7] - However, passenger EV and hybrid sales in China fell for the eighth consecutive month, with a 37.7% drop in December [7] - Morgan Stanley anticipates a more significant domestic recovery for BYD following the launch of several major facelifts in early 2026 [7]