Chinese electric vehicle (EV) manufacturer BYD Co has made waves in the automotive industry by surpassing US-based Tesla Inc in quarterly EV sales, marking a pivotal moment in China’s ongoing and rapid industrial upgrade. According to the latest data from both companies, BYD emerged as the world’s largest EV maker in the fourth quarter of 2023, signifying a notable achievement for China’s burgeoning auto industry, which is poised to propel the nation to become the world’s leading auto exporter.

BYD’s success, not only in overtaking Tesla but also in demonstrating an impressive growth rate throughout 2023 that outpaced not only Tesla but also other EV manufacturers, serves as a microcosm of the significant advancements in China’s extensive manufacturing industry, export sector, and burgeoning domestic market. These elements are considered critical components of China’s overarching strategy for achieving high-quality development, as noted by industry experts.

While Tesla achieved a new company record by delivering 484,500 electric vehicles (EVs) in the last quarter of 2023, the automotive landscape witnessed a notable shift as BYD, in a remarkable twist, announced the sale of approximately 526,400 EVs during the same period. This unexpected turn of events propelled BYD to the forefront, surpassing Tesla and securing the title of the world’s largest EV manufacturer for the first time in the fourth quarter of the year.

While Tesla retained its position as the biggest EV maker for the entire year of 2023, delivering a total of 1.8 million EVs compared to BYD’s total sales of about 1.57 million units, BYD’s year-on-year sales growth rate of 73% for 2023 far outpaced Tesla’s sales growth of 38%. This impressive sales growth rate has fueled speculation that BYD is on track to surpass Tesla and claim the title of the world’s biggest EV maker in 2024.

The substantial market capitalization gap between BYD and Tesla is worth noting, with BYD’s market capitalization at 573.17 billion yuan ($80.21 billion) as of Wednesday, representing only a fraction of Tesla’s $778.42 billion. Over the past six months, BYD’s shares have experienced a 28.85 percent drop, while Tesla’s shares fell by 11.22 percent. Despite this disparity in the financial market, industry analysts express confidence in BYD’s ability to maintain its lead in EV sales over Tesla in 2024.

Hu Qimu, deputy secretary-general of the digital-real economies integration Forum 50, attributes BYD’s success to a combination of factors, including its technological innovation, substantial policy support for industrial upgrading, and a complete and stable domestic supply chain. These factors collectively contribute to BYD’s ability to manufacture high-quality yet affordable EVs, leading to its overtaking of Tesla.

In a statement sent to the Global Times, BYD highlighted its evolution into the world’s largest EV company. Since initiating its passenger car export strategy in May 2021, BYD has exported to 58 countries and regions worldwide. Looking ahead, the company expressed its commitment to continue promoting the overseas expansion of passenger cars and accelerating the global expansion of new-energy passenger cars.

BYD’s remarkable achievement coincides with a flourishing year for China’s entire EV sector in 2023. According to the China Association of Automobile Manufacturers, in the first 11 months of 2023, China’s exports of new-energy vehicles surged by 83.5 percent year-on-year to 1.09 million units. This rapid growth contributed to China’s total auto exports reaching 4.41 million units, up 58 percent year-on-year, surpassing both Japan and Germany, positioning China as the world’s largest auto exporter.

The success of BYD and the broader Chinese EV sector underscores the significant progress that China has made in its relentless pursuit of industrial upgrading and high-quality development. Cui Dongshu, secretary general of China Passenger Car Association, emphasizes that BYD and other Chinese EV makers have greatly benefited from China’s vast domestic market and the country’s concerted efforts to boost industrial transformation and upgrade.

“The biggest factor behind Chinese EV’s success is the technological transformation. In addition, the Chinese market also offered a huge advantage for them to grow,” Cui said. China’s auto industry, particularly the EV sector, has experienced relatively better growth compared to other countries worldwide, thanks to robust policy support from the Chinese government.

BYD, in its statement, acknowledges various policies, including China’s continued reform and opening-up, support for private businesses, and the establishment of a new development model, as contributing to its success. The company recognizes the crucial role played by reform and opening-up in giving birth to BYD and the opportunities created by the new development concept that has strengthened the company.

Policy support for the EV sector is an integral part of China’s broader effort to transform and upgrade its industrial system, a top priority outlined during the Central Economic Work Conference held in December. This conference set priorities for economic work in 2024, listing the development of a modern industrial system led by innovation as a paramount goal.

Hu Qimu notes that China’s industrial transformation and upgrade have made significant strides, leading to a strengthening of international competitiveness. “Through industrial transformation and upgrade, our international competitiveness is also strengthening, and in terms of the macroeconomic situation, all three main drivers have been revitalized,” he said.

An exemplary manifestation of industrial upgrades revitalizing China’s main economic drivers is the surge in exports of EVs. Lithium batteries and solar panels have emerged as highlights of China’s exports in 2023, earning them the label of “the new three items” of China’s exports sector, a notable departure from the previous “three items” of China’s exports – clothes, furniture, and electronics. In the first three quarters of 2023, total exports of “the three new items” jumped by 41.7 percent year-on-year, significantly outpacing China’s total exports during the same period, which experienced a mere 0.6 percent increase due to weak external demand.

Source: Global Times