BYD, the prominent Chinese electric vehicle manufacturer, achieved a notable milestone by surpassing Tesla, led by Elon Musk, in annual revenue. On Monday, BYD reported generating 777.1 billion yuan ($107.1 billion) in revenue for the year, marking a 29% increase. This revenue not only crossed the $100 billion mark but also exceeded Tesla’s 2024 revenue of $97.7 billion.
Recent months have proven favorable for BYD, with its shares increasing by approximately 50% this year, part of a broader rise within the Chinese tech sector. Conversely, Tesla’s shares have dropped 26.6% in 2025, influenced by an outdated product lineup, Musk’s political controversies, and larger macroeconomic concerns regarding U.S. tariffs.
However, examination of BYD’s financials indicates that despite its accomplishments, it must do more to surpass Tesla as the leader in the EV industry. A significant portion, 20.5%, of BYD’s 2024 revenue stemmed from its mobile handset division. The auto segment contributed around 617.4 billion yuan ($85.1 billion) to their revenue, which is still below Tesla’s overall revenue for the same year. Revenue from both companies encompasses more than just vehicle sales, including income from battery sales.
Another distinction is in vehicle types sold; BYD offers both plug-in hybrids and battery electric vehicles (BEVs), whereas Tesla is solely focused on BEVs. Of the 4.3 million vehicles BYD sold last year, only 1.76 million were BEVs, which is less than Tesla’s 1.79 million BEVs sold.
Tesla maintains higher profitability compared to BYD, earning $7.1 billion in net income last year against BYD’s 40.3 billion yuan ($5.6 billion).
Despite BYD not having overtaken Tesla completely, the current narrative surrounding the company is more optimistic than Tesla’s. BYD leads China’s competitive car market, primarily in EVs. BYD saw a year-on-year sales increase during the first two months of 2025, unlike Tesla, which saw a decline during the same period, potentially due to a production pause before a Model Y update.
BYD’s R&D investments could provide further advantages, as consumers demand improved features. The company’s annual report indicates a rise in research and development expenses to 53.2 billion yuan ($7.3 billion), up from the previous year, and higher than Tesla’s $4.5 billion.
The introduction of autonomous driving features has also boosted BYD’s offerings, similar to Tesla’s capabilities, though Tesla faces challenges in launching its “Full Self-Driving” feature in China due to regulatory issues.
BYD unveiled innovative battery technology that can deliver 470 kilometers of range following just five minutes of charging. This advancement is expected in two new models set for release next month, with plans for 4,000 compatible chargers across the country.
Globally, more than 80% of BYD’s sales occur within China, although international sales are expanding. Last year, overseas sales brought in 99.7 billion yuan ($13.7 billion), an increase from 72.4 billion yuan ($9.9 billion) the year prior.
BYD is successfully penetrating markets such as Southeast Asia, Latin America, and Europe with reasonably priced EVs. Nevertheless, the company’s international expansion faces challenges. BYD has no presence in the U.S. due to high tariffs on Chinese EVs, and Europe has also increased tariffs, citing unfair state subsidies as the reason.
The Financial Times reported that two BYD factories are under governmental examination. Beijing is delaying the approval of BYD’s Mexico plant over concerns that its technology could be transferred to the U.S., while Brussels is investigating alleged over-subsidization of BYD’s Hungary plant, slated to begin production in October.
Tesla, too, faces difficulties. Its sales are declining in Europe and the U.S., affected by the transitioning of the Model Y, increased competition, and potential brand damage from Musk’s linkage to the Trump administration.
Investment sentiments reflect divergent narratives for BYD and Tesla. Despite having a lower valuation, BYD’s shares have surged, adding approximately $50 billion to its market capitalization in 2025. Conversely, Tesla has seen a loss of about $400 billion in value during the same period, a figure more than twice BYD’s value.
