BYD beats Tesla in EV sales as Musk bets on robotaxis and future tech

In 2011, Tesla CEO Elon Musk laughed off Chinese EV maker BYD and did not see it as a real rival. About 14 years later, BYD has now beaten Tesla in the global electric vehicle race. BYD has become the world’s largest seller of electric vehicles, based on 2025 sales data released this week. BYD announced on Thursday that it sold 2.26 million EVs in 2025. This was a nearly 28% increase compared to its sales in 2024.

Tesla reported on Friday that its sales fell for the second year in a row. Tesla’s vehicle deliveries dropped 8.6% in 2025 to 1.6 million vehicles, as stated by CNN. This was the largest yearly sales drop in Tesla’s history. BYD managed to beat Tesla even though BYD cars are not sold in the United States. At the same time, China is Tesla’s second-largest market globally.

Tesla sales fall in 2025

In the last three months of 2025, Tesla sold about 418,000 cars. This was 15.6% lower than the same time last year. The fall was bigger than in the third quarter of 2025. In that quarter, Tesla had record sales.Many people in the US bought electric cars quickly before a $7,500 tax credit ended on October 1. That rush helped sales earlier, Tesla does not share sales numbers for each country or region. It only gives total global sales, not separate numbers for the US or China.


Company reports show that the US market brings in nearly half of Tesla’s revenue. Other automakers are also expected to report weak US EV sales for the last three months of 2025. At one point, Tesla’s yearly sales growth was close to 50% per year, as stated by CNN. Tesla reported its first-ever annual sales drop in 2024, with a small 1% decline. Sales fell much faster in the first half of 2025.

Competition and Musk backlash

Tesla faced strong competition from other EV companies like BYD and traditional global carmakers. Tesla also faced backlash because of Musk’s political activities, which upset many buyers in the US and Europe. Early in 2025, Musk led the Trump administration’s Department of Government Efficiency. During that time, there were regular protests outside Tesla showrooms in Europe and the US. There were also reports of vandalism against Tesla cars and company sites.

The rush to use the expiring tax credit helped Tesla sales in the third quarter. However, many buyers likely bought Teslas earlier than planned, reducing sales later in the year. To deal with the lost tax credit, Tesla launched cheaper versions of the Model 3 and Model Y, as stated by CNN. These cheaper models cost about $5,000 less than the premium versions. However, the cheaper models travel fewer miles on a full charge.

BYD faces china price war

They also do not include some features found in premium versions. BYD reached this major milestone while facing intense competition in China. China’s EV market is seeing strong price wars that are hurting profits. Because of pressure at home, BYD has been expanding more aggressively overseas. BYD’s low-price strategy has led to scrutiny and new tariffs in some foreign markets. BYD’s total vehicle sales growth, including EVs and hybrids, slowed to its weakest pace in five years.

BYD sold more than 4.6 million vehicles in total last year. This slowdown shows how difficult China’s auto market has become. China is the world’s largest car market, and BYD sells most of its cars there. BYD reported profit declines in both the second and third quarters of 2025. China’s car market is less crowded than before, but competition is still very strong. There are around 150 car brands and more than 50 EV makers in China.

Competitors like Geely, Leapmotor, and Xiaomi are taking market share from BYD. Xiaomi entered the EV market only in 2024 but is already growing fast. BYD’s China market share peaked at 35% in 2023. That share dropped to 29% in the first 11 months of 2025, as stated by CNN. During the same period, BYD’s sales fell more than 5% year over year. In contrast, Geely’s sales jumped nearly 90% in that time.

CEOs explain slowdown and bet on future tech

BYD founder and CEO Wang Chuanfu explained the slowdown at a December investor meeting. He said BYD lost some of its technology advantage and lacked strong product differences. He also said the company would soon unveil new technologies. Tesla shares rose 1.2% in early trading on Friday. Tesla stock ended 2025 up 18.6% for the year. Investors focused more on Musk’s future plans than weak sales numbers.

Musk has promised a fleet of robotaxis and an “army” of humanoid robots. He said Tesla would start building them soon. So far, Tesla’s robotaxi rollout has fallen far short of his promises. The service is limited to Austin, Texas, and San Francisco, as per the report by CNN. Musk had predicted it would serve half of the US population by the end of the year, which did not happen.

FAQs

Q1. Why did BYD beat Tesla in electric car sales?

BYD sold more electric cars worldwide in 2025 because of strong growth in China and other markets.

Q2. Why are Tesla sales falling even though its stock is rising?

Tesla sales dropped, but investors are hopeful about Elon Musk’s plans for robotaxis and future technology.