China’s BYD has overtaken Tesla to become the world’s largest seller of electric vehicles. This marks a historic shift in the global EV market
Tesla sold 1.64 million vehicles in 2025, down nearly 9% year-on-year. It was the second straight annual decline. In contrast, BYD sold over 2.25 million battery-powered cars, posting almost 28% growth.
Tesla’s slowdown came amid lower demand, subsidy rollbacks in key markets, mixed reactions to new models. Growing pressure from lower-priced Chinese rivals like BYD, Geely and MG was one of the reasons. Sales fell 16% in the final quarter of 2025 alone.
BYD’s edge lies in aggressive pricing and rapid global expansion, particularly across Europe, Southeast Asia, and Latin America, even as many countries impose higher tariffs on Chinese EVs. In the UK, BYD reported an 880% growth in sales in one year, driven by demand for its Seal U plug-in hybrid SUV.
Despite losing the top sales spot, Tesla remains more profitable than BYD. Tesla is betting on future growth from self-driving technology, robotaxis and humanoid robots. Analysts say Tesla’s 2026 autonomous rollout could define its next chapter.
BYD’s growth past Tesla in annual EV sales has been driven by scale, aggressive pricing. BYD has diversified business that extends beyond cars into batteries, buses and electronics.
This has pushed BYD’s total revenue above Tesla’s and in some quarters of 2025. Particularly after US subsidy rollbacks and price cuts hit Tesla and this allowed BYD to briefly post higher net profits. Many charts circulating online reflect this broader revenue base or include BYD’s plug-in hybrid sales, making the Chinese automaker appear more profitable overall.
Tesla’s advantage lies not in volume, but in margins. Do you know this? Despite selling fewer vehicles, Tesla continues to earn more profit per car. This is backed by higher pricing power and a software driven strategy. In effect, BYD is winning the volume and expansion battle, while Tesla is fighting a margin and technology war.
BYD is winning the volume war. Tesla is betting on tech dominance. The EV race is no longer one lane.
Both narratives sit at the heart of today’s EV market reality: scale is shifting east. Profitability leadership remains contested and increasingly dependent on what comes next.
– Opinion | Daily ScrollDown
Source: BBC, Company Reports, Yahoo Finance