Globaltraded.com , Beijing — In a surprising turn of events, China’s electric vehicle (EV) giant BYD has overtaken Tesla in car sales for the fourth quarter, marking a shift in the competitive landscape of the EV market.
Despite Tesla delivering a record number of electric vehicles in the October-to-December period, reaching 494,989 units and meeting its 2023 target, it fell short of BYD’s impressive 526,409 deliveries. Most of BYD’s deliveries occurred in China, suggesting a preference for more affordable models in a high-interest-rate economy.
Although Tesla’s year-end sales push helped it achieve a significant milestone of delivering 1.8 million vehicles in the entire year, it still fell short of CEO Elon Musk’s ambitious internal target of 2 million annual deliveries. However, Tesla maintains its lead over BYD for the full year.
BYD’s total deliveries for the year reached 3.02 million vehicles, including approximately 1.4 million plug-in hybrid EVs, showcasing the company’s strong performance. This accomplishment indicates that BYD’s pricing strategy, including effective price cuts, is resonating well with consumers.
Analysts suggest that Tesla’s increased discounts and incentives, such as six months of free fast charging for deliveries by the end of December, were aimed at boosting sales before certain variants of its compact Model 3 sedan lose US federal tax credits in 2024.
Tesla’s stock, which doubled in the previous year, remained nearly flat on Tuesday in a generally weaker market. Despite BYD’s success in Q4, Tesla’s overall delivery numbers for the year are still considered better than those of domestic US car companies.
BYD’s ability to gain market share and recognition through price cuts indicates a willingness to sacrifice margins for increased competitiveness. This move is expected to intensify the competition between the two companies in the global EV market.
As Tesla faces scrutiny from regulators over its self-driving technology, including a recent recall of over 2 million vehicles to install new safeguards in its Autopilot system, challenges lie ahead. Meanwhile, analysts suggest that Tesla may need to continue price cuts initiated last year to maintain demand, especially after the end of tax incentives. (GT)
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