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BYD Surpasses Tesla in Global EV Sales as Challenges Pile Up in 2025

BYD Surpasses Tesla in Global EV Sales as Challenges Pile Up in 2025

Post by : Bianca Haleem

Tesla has fallen from its position as the leader in electric vehicle (EV) sales in 2025, facing a cascade of challenges including political factors, expiration of U.S. tax incentives, and stiff competition from international players. The company announced it delivered 1.64 million vehicles last year, reflecting a 9% decrease compared to 2024. Meanwhile, Chinese automotive giant BYD recorded sales of 2.26 million EVs, claiming the title of the world’s largest EV manufacturer.

This development underscores a noteworthy change in the global electric vehicle landscape, as Tesla encounters obstacles hindering its expansion following years of growth. Although former U.S. President Donald Trump endorsed Tesla at the beginning of 2025, the company could not sustain demand after a $7,500 federal tax credit expired in September.

In the fourth quarter, Tesla sold 418,227 vehicles, falling short of the 440,000 forecast made by FactSet analysts. The lowered expectations reflect challenging market conditions worsened by aggressive competition, particularly from Chinese brands offering lower-priced options.

To address these issues, Tesla launched more affordable versions of the Model Y and Model 3 in October 2025, priced under $40,000 and $37,000. These competitively priced cars aim to capture the European and Asian markets, where Chinese EVs are gaining significant ground.

Looking forward, analysts predict around a 3% sales decline for Tesla, coupled with nearly a 40% drop in earnings per share in the next quarterly report. However, there is cautious optimism for a rebound in 2026 fueled by Tesla’s ventures into new industries.

CEOs have pivoted their attention from standard vehicle sales to advanced technologies that include autonomous robotaxi operations, energy storage systems, and home and industrial humanoid robots. In mid-2025, Tesla initiated a robotaxi pilot program in Austin and plans to extend its service to additional cities this year. Overcoming regulatory obstacles and competition from leaders like Waymo will be crucial for success in this sector.

Tesla also faces ongoing federal safety inquiries and risks of a temporary halt to its California sales license related to claims over misleading self-driving capabilities. Despite this, analysts, such as Dan Ives from Wedbush Securities, maintain a positive outlook on Tesla’s autonomous vehicle initiatives.

In late 2025, shareholders endorsed a potentially enormous compensation plan for Musk, further solidifying confidence in his leadership role. Additionally, a recent ruling from the Delaware Supreme Court reinstated Musk’s $55 billion pay package awarded in 2018.

Musk’s wealth could further ascend with the expected public offering of SpaceX, a move analysts believe could elevate him to become the world’s first trillionaire by the end of 2026.

Jan. 3, 2026 11:32 a.m. 340
Global News World News

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