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BYD Is Using A New Approach To Overtake Tesla: Luxury Cars And Super Car-Style EV

AInvestTuesday, Jan 23, 2024 4:45 am ET
2min read

Buoyed by a wider range of models and more affordable price tags, BYD surpassed Tesla in single-quarter sales last quarter and ripped the title of World's Largest Electric Car Seller from Tesla.

As a result, more frequent discussions began to emerge as to whether BYD, once an unnoticed player in the global auto industry, would replace Tesla to become the world's leading electric vehicle brand.

Tesla's Sales Lag, BYD Presses its Advantage

Musk certainly does not like these debates, however, regardless of his feelings, compared with BYD, his company's sluggish sales performance is undeniable.

In China, the world's largest electric vehicle market, Tesla's market share has been shrinking. Data for the first 11 months of last year showed that Tesla's market share in China was less than 3%, nearly four times less than BYD's.

Despite Tesla's Model Y remaining the most popular electric vehicle in China last year, over half of China's top-selling 20 electric vehicle models belonged to BYD, with sales of its new pure electric vans and cars setting new records.

The founder of Sino Auto Insights, Tu Le, believes that based on the current situation, BYD has the China market completely covered for the most part.

Overseas, Tesla still has its advantages, but BYD is catching up. Last year, BYD topped Thailand's electric car sales list with as many as 30,000 units sold. In other overseas markets like Australia and Israel, this native electric car manufacturer is rapidly rising.

After successfully overtaking Tesla to win the quarterly sales champion in the last quarter of last year, BYD also has ambitious plans for overseas market development this year. The company expects its overseas car sales will reach 400,000 units this year, and the high profits from exports may even become its next growth engine.

Luxury line could be BYD's shortcut to overtake Tesla

BYD is also starting to expand its range of models to catch up, or even topple Tesla, in global sales, with high-end and even supercars being the next targets for the domestic electric vehicle leader.

Currently, BYD has already shifted its survival strategy from a focus on low-cost vehicles to investing in the development of advanced, albeit more expensive, models. The emergence of the YangWang brand, including the supercar U9, which has a similar outlook as Lamborghini, and the U8, capable of turning on the spot and floating on the water, are direct expressions of BYD's new strategy.

Analysts said that BYD's current development of the YangWang brand is emulating the likes of General Motors, Ford, and Volkswagen in establishing their own car brand family, because in the current competitive passenger vehicle market, There's no global automaker that just sells one brand, outside of Tesla, analysts said.

According to BYD's data, as of 2023, the company had received orders for over 135,000 luxury and high-end cars. As of December last year, Yangtze U8 sales had reached 1,592 units, making it one of the top sellers in China's luxury car sales ranking.

In addition to the domestic market, the overseas market also showed great interest in the Yangtze series. According to some second-hand car exporters, the U8 is priced at over 2 million yuan in Russia, and even up to 3 million yuan per car. Further, BYD has previously stated that the U8 SUV will be sold in Brazil.

With its overseas expansion and the bolstering of its family brand, BYD is now changing the outside perception of its brand. For example, when comparing BYD and Tesla, Gary Black, co-founder of the Future Fund Active ETF, believes that Tesla and BYD are the only two investible EV companies today, which suggests that in the eyes of many, BYD may already have the ability to compete with Tesla.

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