China’s BYD crowned world’s top electric vehicle maker: Elon Musk’s Tesla loses out after sales fall again
Tesla has ceded its crown as the world’s top electric vehicle maker to BYD after annual sales fell for a second year, hit by rising competition, the expiry of US tax credits and brand backlash.
With global EV sales rising 28 per cent last year, BYD outsold Tesla for the first time on an annual basis, helped by rapid growth in Europe, where the Chinese car maker has been widening its lead over the US rival.
Tesla, whose sales fell about 8.6 per cent in 2025, is facing intense competition, especially in Europe, raising questions about its ability to revive the core car business as CEO Elon Musk steers the company towards robotaxis and humanoid robots.
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Shares of the company were down more than 1.0 per cent in Friday morning trading on Wall Street.
“Investors are so focused on the future with Tesla that they are ignoring delivery numbers. It’s about Optimus, Robotaxi and physical AI,” said Dennis Dick, a trader at Triple D Trading, which owns Tesla shares.
Tesla’s fourth-quarter figures come after third-quarter deliveries were supported by a rush to lock in $US7500 ($A11,221) in Federal tax credits after US President Donald Trump’s administration decided to pull the plug on the incentive in September.
Tesla said it delivered 418,227 vehicles in the October-December quarter, down 15.6 per cent from 495,570 a year earlier.
Analysts expected 434,487 vehicles or a 12.3 per cent drop, according to Visible Alpha.
For the full year, Tesla delivered 1.64 million vehicles, compared with 1.79 million in 2024.
Analysts polled by Visible Alpha had expected deliveries of about 1.65 million vehicles, marking the company’s second consecutive annual decline.
Tesla reached its peak in 2023, delivering more than 1.8 million vehicles.
The decline in deliveries was not a major surprise, given the market had already priced in weaker demand after US EV tax credits ended, said Seth Goldstein, senior equity research analyst at Morningstar.
Meanwhile, Tesla said it deployed 14.2 GWh of energy storage products, a record high.
It is set to report fourth-quarter results on January 28.
Growing competition from Chinese and European car makers such as BYD, Volkswagen and BMW has weighed on Tesla’s sales momentum.
BYD said sales outside of China climbed to a record one million vehicles in 2025, up about 150 per cent from 2024.
The company has said it aimed to sell as many as 1.6 million vehicles outside China in 2026, although it has not disclosed an overall sales target.
BYD sold 4.6 million vehicles in 2025 in total, eight per cent more than in the previous year.
These included 2.3 million battery-electric vehicles, which marked an increase of 28 per cent year-on-year, according to the car maker.
Tesla in October launched stripped-down “Standard” versions of the Model Y and Model 3, priced about $US5000 below the previous base models, as it sought to defend sales volumes after the tax credit loss and appeal to customers in Europe looking for cheaper options.
The move disappointed some investors who had expected a larger price cut or a meaningfully new mass-market product.
Even as vehicle deliveries have weakened, Tesla shares rose about 11.4 per cent in 2025.
with DPA
