It’s not just Tesla, another EV giant takes a big tumble | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

While the U.S. has been waging a tariff war on foreign imports, Chinese electric vehicle maker BYD has fought a different kind of war against its domestic competition.

The Chinese government has invested heavily in getting its citizens to drive EVs. It has used cash, tax, and other incentives to push EVs and hybrids.

The plan is working.

In 2024, China produced 31.2 million vehicles and sold another 31.4 million, according to the China Association of Automobile Manufacturers.

Out of those totals, 12.88 million new energy vehicles (NEVs) were produced and 12.86 million were sold. NEV sales were up 35.5% year over year, allowing China to rank first for the 10th consecutive year.

Meanwhile, the U.S. also had a record year for NEV sales, with dealers being able to move 3.2 million of them in 2024, according to auto data firm Moto Intelligence.

But BYD, the company most responsible for China’s green vehicle revolution, is now facing a period of slowing growth.

BYD had to lower its goals due to a slowdown in sales.

Image source&colon; Zhang Congyu/VCG via Getty Images

BYD slashes sales guidance as EV market slows down

On Sept. 4, BYD cut its 2025 sales target by as much as 16% to 4.6 million vehicles, according to a Reuters report citing two insiders.

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.

Last week, BYD reported its first quarterly profit decline in three-and-a-half years.

BYD’s dismal second quarter

Quarterly profit of 6.4 billion yuan ($894.74 million) was down 29.9% from a year ago.
Quarterly revenue rose 14% to 200.9 billion yuan on higher volume, but lower prices ate into profits.
A year ago, BYD reported a 100.04% increase in quarterly profit.
China’s vehicle sales fell for a third consecutive month in July as production fell for the first time in 17 months.

But BYD’s latest price target is below even the recently lowered estimates from Deutsche Bank (4.7 million) and Morningstar (4.8 million).

Tesla is also faltering in China, thanks to pricing wars and competition

BYD followed the lead of Tesla by lowering prices to garner market share.

Tesla has been marketing in China using the made-in-China mantra, but data show that production at its China plant is slowing.

Tesla made 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.

Once the dominant EV market player, Tesla has faced a demand problem for 18 months that has only been exacerbated by Musk’s foray into politics.

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.