In a significant shift in the global electric vehicle (EV) market, BYD has outpaced Tesla in quarterly revenue for the first time, marking a new chapter in the competition between the world’s automakers in the EV industry.

According to BYD, the company reported record-breaking Q3 revenue of RMB 201.1 billion ($28.2 billion), representing a 24% increase year-over-year and surpassing Tesla’s $25.2 billion for the same period. The company’s net income rose 11.5% to RMB 11.6 billion ($1.6 billion), though still falling short of Tesla’s $2.2 billion profit.

The milestone comes as BYD achieved unprecedented vehicle sales, delivering more than 1.1 million new energy vehicles (NEVs) in Q3 – the first time the company has crossed the million-unit threshold in a single quarter. This total includes both pure EVs and plug-in hybrids (PHEVs), with the latter showing particularly strong performance.

As a result, September 2024 marked BYD’s seventh consecutive month of record-breaking PHEV sales, with 252,647 units sold, an 88% increase from the previous year.

While BYD’s total NEV sales stood out, Tesla maintained its lead in pure EV deliveries, with 462,890 EVs sold compared to BYD’s 443,426 in Q3. BYD’s success has been bolstered by its strong hybrid vehicle lineup, which has helped insulate it from waning consumer demand for purely EVs.

BYD’s competitive advantage stems from several factors, including its vertically integrated supply chain and in-house parts production, which enables more cost-effective manufacturing. The company has also benefited from robust domestic demand in China, supported by government subsidies encouraging consumers to trade in conventional vehicles for electric and hybrid alternatives.

Furthermore, the company’s gross margins reached 21.9% in Q3, up from 18.7% in the previous quarter and surpassing Tesla’s 19.8%. This performance comes despite facing international challenges, including new European Union (EU) tariffs of up to 45% on Chinese EVs and existing barriers to entry in the United States (U.S.) market.

In terms of long-term goals, BYD appears well-positioned to maintain its momentum. The company is on track to meet its revised annual sales target of 4 million vehicles, having already sold around 2.74 million units through September.

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With the competition between BYD and Tesla, it spotlights the evolving EV landscape of the global automotive industry. As global automakers continue to revise their EV strategy, BYD’s approach demonstrates a winning formula, driven by its diverse EV lineup and strong presence in global market.

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