China is, by far, the largest auto market in the world, so almost by default, it is also the largest electric vehicle market in the world.
According to the International Energy Agency in 2024:
- China: 6.4 million EVs sold
- Europe: 2.2 million EVs sold
- U.S.: 1.2 million EVs sold
- Rest of world: 1 million EVs sold
China not only sold more EVs in 2024 than the rest of the world combined, but it also nearly sold more plug-in hybrids (4.9 million) than the rest of the world sold EVs.
But BYD, the company most responsible for China’s green vehicle revolution, is now facing a period of slowing growth.
According to news reports, on Sept. 4, BYD cut its 2025 sales target by as much as 16% to 4.6 million vehicles.
If those numbers hold, it would be the company’s slowest annual growth rate in five years. BYD had told investors earlier this year that it expected to sell 5.5 million vehicles, but after the latest quarter, those goals may prove a bit lofty.
Tesla (TSLA) has also seen its market in China dwindle, but analysts at Piper Sandler are still bullish on the company’s outlook in the Far East, raising its price target in a note.
Tesla has a leg up on its competitors in China, according to Piper Sandler.
Image source: STR/AFP via Getty Images
Piper Sandler raises Tesla price target, Tesla stock climbs
Tesla shares were up 3.4% at last check Sept. 22 after the electric vehicle maker was the subject of a bullish note from analysts at Piper Sandler.
After visiting China, analysts led by Alexander Potter and Ben Johnson raised Tesla’s price target to $500 per share from $400 per share.
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The firm sees Tesla’s artificial intelligence as light-years ahead of its competitors in China.
“After meeting with Chinese EV makers, we can see why Elon Musk respects these ‘fast followers’ so much,” analysts Alexander Potter and Ben Johnson said in a note, according to Investing.com. “But when it comes to ‘real world’ AI, these companies look to Tesla for guidance – not the other way around.”
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While Chinese competitors are building EVs that are at least as good, if not better, than Tesla’s models, Tesla still holds the edge on the tech side.
Piper Sandler expects Tesla to deliver 495,000 vehicles in the third quarter, an all-time record for the company.
“Bottom line: TSLA remains our top idea for investing in autonomous vehicles and robotics,” the firm stated.
Tesla has been faltering in China, despite AI head start
Tesla has been marketing in China using the made-in-China mantra, but data show that production at its China plant is slowing.
Tesla built 58,459 Model 3 and Model Y vehicles at Gigafactory Shanghai in April, a 6% year-over-year decline. This came as demand fell, with delivery data also declining in recent weeks.
The company delivered just 384,122 vehicles globally in the second quarter, a 13.5% year-over-year decline that missed analyst estimates by about 3,000 units.
Last year, Tesla experienced its first annual sales decline since 2011 after reporting a 1.1% drop in overall deliveries to 1.79 million from 1.81 million the year prior, the AP reported, citing data from analytics firm Global Data.