BYD Chases Down Tesla in Electric Vehicle Sales

China's leading battery-electric vehicle seller, BYD, is rapidly closing in on Tesla as it continues to gain momentum in the electric vehicle market. In July, BYD reported new energy deliveries totaling 261,105 units, including both plug-in hybrids and battery-electric vehicles. Of this total, approximately 134,800 were battery-electric vehicles, an increase from the 81,000 units sold in July 2022.

Over the past three months, BYD has delivered an impressive 383,000 battery-electric vehicles. In comparison, Tesla, which provides delivery reports on a quarterly basis, delivered approximately 466,000 battery-electric vehicles in the second quarter. These figures reveal that BYD is now responsible for over 80% of Tesla's quarterly delivery volume.

Given their respective growth rates, it is possible that BYD could surpass Tesla in the coming quarters. However, this outcome is not guaranteed. As sales numbers increase, sustained growth becomes more challenging. Tesla has previously demonstrated a willingness to prioritize volume growth over profit margins by aggressively reducing prices for its electric vehicles worldwide in early 2023.

While the ranking of number one and number two holds significance in terms of bragging rights, it is important to note that BYD and Tesla target slightly different markets with their vehicle lineups. Tesla primarily focuses on higher-end car models and boasts higher profitability than BYD. Additionally, Tesla's market cap considerably exceeds that of BYD, with Tesla's shares valued at around $820 billion compared to BYD's market cap of approximately $110 billion.

The results from both BYD and Tesla indicate that the strongest players in the industry continue to consolidate their dominance. Together, Tesla and BYD have delivered nearly 1.6 million electric vehicles over the past six months, representing a 70% year-over-year increase. In contrast, two smaller electric vehicle manufacturers, XPeng and NIO, have experienced a slight decline in sales, delivering approximately 114,000 electric vehicles over the same period, down by 4% year over year.

In trading news, BYD's shares experienced a 0.9% decline in overseas trading, while BYD's U.S.-listed ADRs fell 1.4% during Monday's trading session. The S&P 500 and Nasdaq Composite both declined by 0.3% and 0.4%, respectively. Tesla's stock saw a larger drop of 2.4%.

Overall, the competition between BYD and Tesla highlights the continual strengthening of the electric vehicle market. With both companies demonstrating significant sales growth, it will be interesting to observe their progress in the coming months.