Tesla Is Flailing In China - And The Rapid Rise Of Byd Is To Blame

Elon Musk's car maker has been backsliding in China for the past five consecutive months on a year-on-year basis, according to data from the country's Passenger Car Association. Tesla's shipments plunged 49 in February from a year earlier to just 30 688 vehicles, the lowest monthly figure since way back in July 2022, when it shipped just 28 217 EVs - and that was in the middle of Covid.

Tesla's factory on the outskirts of Shanghai has had some of its production lines retooled for efficiency and to relaunch the popular Model Y, so it's to be expected both that output dropped and will take some time to ramp back up. But even before that, the trend was heading in the wrong direction.

Look at BYD. The company, which stopped making cars powered entirely by internal combustion engines in March 2022, has a market share heading towards 15. It sold more than 318 000 fully electric and hybrid passenger vehicles last month, up 161 year on year. The Shenzhen-based car maker also notched another record month for overseas sales, which hit 67 025 units.

Its success is a major reason why Tesla is losing.

Both the Model Y and Model 3, the two vehicles Tesla makes in Shanghai, have only had their prices trimmed, rather than slashed, and buying one still costs around 33 500 on average.