BYD closed 2025 by eclipsing Tesla in battery-electric vehicle sales for the first time, a milestone that underlines the Chinese manufacturer’s lead in pure EVs. At the same time, softer data from the company’s domestic market and a challenging industry backdrop pulled the stock lower in Hong Kong. The divergence between Asia-listed and U.S.-listed shares highlights how differently investors are weighing the situation.
- 2025: 2.26 million BEVs, roughly +28% year-over-year
- Tesla: 1.64 million vehicles, around −9% – first decline in years in the modern EV era
- Overall (including plug-in hybrids): 4.6 million vehicles, +7.7%, but the weakest growth rate in five years
- December: about −18% sales versus the prior year
- International business: >1 million vehicles, +145%
BYD Surpasses Tesla
The confirmed annual figures make the leadership change at the top of the electric-vehicle market unambiguous: BYD moved about 2.26 million pure EVs in 2025, up nearly 28% from 2024. Tesla delivered around 1.64 million vehicles, down about 9% – the first annual dip in the U.S. automaker’s modern EV era.
When plug-in hybrids are included, BYD’s total reaches 4.6 million vehicles, up 7.7% versus 2024. This level of growth is well below the double- or triple-digit gains seen in earlier years and marks the slowest pace in five years, signaling a maturing market in China.
Focus on Global Expansion
Against this backdrop, BYD’s CEO Wang Chuanfu used a New Year’s address on January 5 to stress the company’s ambitions to accelerate international growth and to craft a “world-class Chinese brand.” The data support this direction: overseas sales jumped 145% in 2025 and surpassed the 1 million-vehicle mark for the first time. The international business is increasingly becoming the main growth engine, while momentum at home has cooled.
In specific regions, BYD is adjusting its approach. In India, a price increase for the Sealion 7 Premium was announced to take effect from January 2026, signaling a shift toward healthier margins in select markets rather than pursuing volume alone.
Weak December and Competitive Pressure
The enthusiasm surrounding a record year was tempered by December results, which showed a roughly 18% year-over-year sales drop. It was the fourth consecutive month with weakening or negative momentum across parts of BYD’s portfolio.
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This trend aligns with a broader picture of tension in China’s EV sector. On January 5, BYD, Li Auto, and XPeng joined a number of peers in trading lower in Hong Kong. Markets are reacting to the phasing-out of subsidies and ongoing price battles that compress margins. A related export-market signal came from Australia, where Chery cut Tiggo 7 prices, positioning it below BYD’s Sealion 5 and highlighting intensifying competition in export markets.
Shifts in the EV Landscape
BYD’s ascent alongside Tesla’s softness in 2025 illustrates a broader shift in the global auto sector. Tesla posted a 16% quarterly decline in Q4, pressured by the expiration of U.S. tax credits and an aging model lineup. BYD benefited from a broad product range spanning the affordable “Seagull” to premium Yangwang SUVs.
Yet the operating environment remains demanding. Analysts at JPMorgan and Deutsche Bank foresee up to 50 defunct Chinese EV brands exiting the market by 2026 as capacity outpaces demand. BYD is considered comparatively well-positioned in this consolidation, but persistent price pressure short-circuits near-term upside for the equity. The 7.7% volume growth in 2025 also pushes investors to align valuation models more with mature industrial firms than with high-growth tech names.
Outlook for Results and the Share Price
Attention now turns to the full-year results. In particular, investors will be keen to see how aggressive export expansion and domestic price cuts impacted profitability. For Q1 2026, the question remains whether BYD can meet the analyst-flagged target of around 1.6 million overseas vehicles for the year.
Technically, there is a notable gap between Hong Kong and U.S. trading. The Hong Kong-listed shares slipped about 2.4% on Monday, reflecting weak December data and regional economic sentiment, while the U.S. listing rose more than 5% on the prior Friday, driven largely by headlines about the leadership transition at Tesla. The next phase will hinge on whether the current support region in Hong Kong holds and whether the stock consolidates before the broader impact of BYD’s global-brand strategy becomes clearly visible in its financials.
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