Chinese automaker BYD is gaining momentum in the increasingly competitive global electric vehicle race while the dominance of longtime leader Tesla is eroding.
The Warren-Buffett-backed automaker on Monday reported a 13% year-over-year increase in sales of “new energy” vehicles, including both electric and hybrid vehicles. The company sold a total of 626,263 vehicles in the first quarter, of which about 300,114 were pure electric vehicles.
While sales were down in the first two months of the year, purchases rose 46% in March, the company said.
BYD’s strong first-quarter performance contrasts with plummeting expectations for Elon Musk-owned electric vehicle maker Tesla, whose shares have fallen nearly 30% year to date.
Some analysts have revised down their forecasts for the company’s first-quarter vehicle deliveries, a proxy for sales, following reports of production cuts at Tesla’s Shanghai plant.
Wedbush Securities cut its estimate to 425,968 from about 475,000. If Wedbush’s forecast is correct, Tesla vehicle deliveries would rise less than 1% year over year, but would still be higher than BYD’s net EV sales over the same period. Tesla is set to report first-quarter vehicle deliveries on Tuesday.
Despite years of strong growth, Tesla faces increasing competition from Chinese automakers including BYD. Late last year, the automaker overtook Tesla as the world’s largest seller of electric vehicles on a quarterly basis for the first time.
The global electric vehicle race has begun to heat up, especially as cheaper cars from China make their way overseas, much to the dismay of Western governments and established automakers such as Nissan and Honda, as well as Tesla. In addition to BYD, Chinese automakers such as Li Auto, Nio and Xpeng also reported sales. rebounds in March after a weaker start to the year.
Tesla critics and bulls have begun sounding the alarm about the company’s performance, including Wedbush’s Dan Ives, who told CNBC last week that the company is in “dire straits.”red situation code” Ives reiterated his overweight rating on the stock with a $300 price target. Shares were trading at around $175 on Tuesday.
To boost sales, Tesla recently abandoned its aversion to digital advertising. Musk also promised many of his customers a free trial of the $12,000-a-year Full Self-Driving mode to help attract more subscribers.
However, Musk warned investors that Tesla will likely see “notably weak” sales growth this year.