What?! How the Chinese from BYD overtook Tesla in the production of electric vehicles and actually turned BMW into a trough

At the beginning of 2024, it came as a surprise to everyone that the Chinese company BYD overtook Tesla in electric vehicle sales in the last quarter of 2023.

Despite its great popularity, little is known about BYD. This is largely due to the fact that the company sells its cars almost within China.

But it has an interesting history and strategy that prefers to keep prices low, which Tesla has a very hard time competing with.

BYD was originally a battery manufacturer.

BYD was founded in February 1995 by Wang Chuanf and his brother Lu Xiangyang, who previously worked as deputy director of the Beijing Non-Ferrous Metals Research Institute. He has a master’s degree in battery technology.

Chuanf initially created the company to produce batteries for mobile phones and home appliances. BYD used manual labor in production and its own equipment, which significantly reduced costs.

7 years after its founding, BYD has become the world’s leading manufacturer of nickel-cadmium batteries and the third largest manufacturer of lithium-ion batteries.

In 2005 BYD has become the largest Chinese battery manufacturer in China.. It also had over 50% of the mobile phone battery market, with Nokia and Motorola among its major clients.

In 2017, BYD Electronic, a subsidiary, was established and conducted testing to produce batteries. This division had to be separated into a separate company, because at that time BYD Auto, a subsidiary of BYD for the production of cars, was already operating.

BID F3

BYD Auto was founded in 2003 after purchasing Qinchuan Auto. Already in 2005, the company launched production of its first car, BYD F3. The model turned out to be very successful. From 2011 to 2013, it was assembled at the Russian TagAZ plant.

In 2009, the first electric car BYD e6 was released. The legislative company continued to adjust its model range, and also developed new directions – electric buses and trucks.

BYD will stop producing ICE cars in 2022

2022 became a key year in the history of BYD, since in April the company stopped producing cars with classic internal combustion engines. The decision was due to the fact that BYD wants to concentrate on the production of electric vehicles and hybrids.

Many car companies are passing on the production of cars with internal combustion engines, but few are ready to do it right now. And to be more precise, no one. Tesla is a source because it initially only produced electric cars.

But BYD took such a step consciously, because it has the resource for this. BYD produces more than 70% of automotive components itself. By the way, BYD itself produces the most important parts: batteries and motors. Not only is it less dependent on its suppliers, but it can also keep prices low.

Why BYD overtook Tesla in sales

One of the main advantages of BYD is its large product range and low prices. Most BYD cars in China cost from $13.2 thousand to $46.7 thousand. Tesla Model 3 and Y in China cost an average of $50 thousand, and this is already taking into account the fact that the company has reduced prices.

BYD has premium divisions, but mostly remains budget models. And this sales model distinguishes BYD not only from Tesla, but also from other Chinese electric vehicle makers such as Zeekr, XPeng and Li Xiang, which mainly compete in the premium segment.

By selling cars at low prices, BYD helps produce environmentally friendly components. The Company relies on other suppliers only to obtain portable parts. But the main thing is that BYD independently produces batteries for electric vehicles. The battery in a car is one of the most expensive components, and there aren’t many companies around the world that make them, so many manufacturers rely heavily on other suppliers.

In addition, having abandoned the production of cars with internal combustion engines, BYD has greatly expanded its range of electric vehicles over the past two years. Its product range includes sedans, crossovers and compact city hatchbacks.

BYD car sales dynamics. Light green – hybrids, dark green – electric cars.

In total, in 2023, BYD’s sales correspond to 3 million cars, Tesla – 1.8 million. However, in this situation, sales of BYD hybrid cars are also observed. If we leave only electric vehicles, then BYD sold 1.6 million cars in 2023.

At the same time, experts are confident that supply and demand for BYD will grow. In December 2023 alone, BYD’s sales increased by 70% compared to the same period last year.

BYD’s most popular electric cars

1. BYD Qin Plus

🏎️ Power: 136 hp
🔋 Power reserve: 420-610 km
💰 Price: from $18.2 thousand

Qin Plus was the best-selling electric vehicle in China in the second half of 2023.

It is a mid-size sedan, measuring 4.7 meters in length and equipped with one simple engine on the front axle. At the same time, it is inexpensive, has a large power reserve and many different options.

2. BYD Chaika

🏎️ Power: 75 hp
🔋 Power reserve: 305-405 km
💰 Price: from $10.3 thousand

The Seagull compact hatchback was launched in March 2023, but in less than a year the company sold 200 thousand cars, which is an alternative indicator for any company.

The Chaika has a modern interior, a good range, but a weak engine. The maximum speed is only 130 km/h. But this disadvantage is compensated by a very low price.

3. BYD Song Plus

🏎️ Power: 186 hp
🔋 Power reserve: 520-605 km
💰 Price: from $22.3 thousand

In third place in sales is Song Plus. This is the cheapest and most compact crossover in the BYD lineup.

This model has also been updated for 2023. The car offers a large list of options. There is even a function to open the car via NFC on the iPhone.

4. BYD Dolphin

🏎️ Power: 94 hp
🔋 Power reserve: 301-420 km
💰 Price: from $16.3 thousand

BYD Dolphin is positioned as an improved version of Seagull. It costs a little more, but has slightly larger dimensions and improved technical characteristics.

In addition, the Dolphin is officially sold in Europe, as well as in countries that drive on the right, such as Australia, Japan, Thailand and Malaysia. Chaika is only available in China.

5. BID Khan

🏎️ Power: 222 hp
🔋 Power reserve: 605 km
💰 Price: from $29.5 thousand

BYD Han is a full-size E-Class sedan that is smaller in size than the Toyota Camry, BMW 5 Series and Audi A6.

The car is available in various modifications, ranging from the simplest front-wheel drive to the “charged” all-wheel drive version, which accelerates from 0 to 100 km/h in 3.9 seconds.

BYD will maintain leadership in the electric vehicle market in 2024

Experts at The Wall Street Journal believe that BYD will overtake Tesla in electric vehicle sales in 2024. Throughout the year, not a single quarter.

BYD is well positioned to achieve this goal. Most of its cars are cheaper than the most budget Teslas, and its own battery production helps keep prices low.

90% of sales are now made within China. But BYD is actively expanding in foreign markets; the company’s priority is Europe.

BYD currently sells five electric vehicles in Europe, with three more models to be added this year. BYD also plans to build a plant in Hungary to produce electric vehicles. It will likely be located near BYD’s other plant in Hungary, which produces electric buses.