It’s the world’s hottest car company. You can’t buy one in America
In the world of electric vehicles, there’s a Chinese company outdoing Elon Musk’s Tesla. And it’s just getting started.
BYD, the Shenzhen-based Chinese EV champion, eclipsed Tesla in annual sales last year. Last week, it unveiled a revolutionary battery charging technology that it says adds 250 miles of range in five minutes, outpacing Tesla’s Superchargers, which take 15 minutes to add 200 miles. And last month, BYD launched “God’s Eye,” an advanced driver-assistance system rivaling Tesla’s Full Self-Driving feature, at no extra cost for most of its cars.
They’re just three examples of how BYD has been pulling ahead of Tesla. The company once casually dismissed by Musk is now effectively outperforming Tesla in sales, innovation and price competitiveness.
“They’re not resting on their laurels, as you can see from the God’s Eye announcement and from the fast-charging announcement,” Tu Le, founder and managing director of the consultancy firm Sino Auto Insights, told CNN. “They’re content to push the envelope and set the pace for the whole world.”
Having dominated its home market of China, the world’s largest auto market, BYD is starting to expand globally, with notable exceptions like the United States, a country it is effectively barred from due to 100% tariffs on its passenger cars.
Here’s everything you need to know about the rise of the Chinese EV maker, and how it is upending the global market for clean-energy cars.
What is BYD?
Founded in 1995 by Wang Chuanfu in China’s megacity of Shenzhen, BYD is the country’s No 1 automaker. It exports its electric taxis, buses and other vehicles to markets across Europe, South America, Southeast Asia and the Middle East.
In China, BYD accounted for 32% of last year’s total sales of new energy vehicles, which include hybrids, far outpacing Tesla’s 6.1% market share, according to the China Passenger Car Association. (BYD makes both battery-powered cars as well as hybrids, while Tesla makes only fully electric vehicles powered by batteries.)
Tesla's competition comes from China
BYD and Tesla are locked in a fierce competition as the world's number one seller of battery electric cars. BYD surpassed the American giant for the first time in the last quarter of 2023. After falling behind for part of 2024, the Chinese company ended the year selling almost 100,000 more cars than Tesla in the last quarter.
BYD reported $107 billion in sales for 2024, a 29% jump from the previous year, on deliveries of 4.27 million cars, including hybrids. By comparison, Tesla’s 2024 revenue was $97.7 billion, and it delivered 1.79 million battery-powered vehicles. Its annual deliveries declined for the first time last year by 1.1%.
While BYD’s battery-powered EV shipments of 1.76 million vehicles were marginally short of Tesla’s, investors and analysts are bullish on BYD’s potential as it expands overseas. Most of BYD’s shipments were delivered to domestic customers with just 10% exported to overseas markets.
“We believe sales momentum will remain robust for 2025, and BYD will be able to retain its leadership with the rollouts of new-generation models equipped with the advanced driver-assistance system,” Vincent Sun, Morningstar’s senior equity analyst, wrote in a Monday research note.
While many believe BYD stands for “Build Your Dreams,” Wang said in an interview for Tencent that it originally had no such meaning. It was simply an “odd” combination of three Chinese characters “bi ya di,” he told the online interview program. The slogan “Build Your Dream” was conceived later for marketing purposes.
What are its most popular models?
BYD’s top-selling passenger vehicles are the Qin and Song models, which cater to a broad swath of consumers drawn to the company’s reputation for affordability. The Qin, a compact sedan, is available as both a plug-in hybrid and a fully electric model, while the Song comprises a lineup of compact crossover SUVs.
Unlike Tesla, which has positioned itself as a premium brand, BYD has built its success on price accessibility. Its entry-level model starts at just over $10,000 in China, a fraction of the cost of Tesla’s least expensive Model 3, which sells for more than $32,000.
Though BYD’s passenger cars have yet to enter the US market due to high tariffs, its electric buses are already in service in California.
Who is Wang Chuanfu?
Wang was born in 1966 to a simple rural family in Anhui province in eastern China. But disaster struck when both of his parents died young, leaving him orphaned when he was in middle school, according to The Paper, a Chinese state-owned publication. Wang relied on his older brother to provide for him and his education.
Wang spent several years at the state-owned Beijing Nonferrous Metals Research Institute, where he got his master’s degree. The institute later established a battery company in Shenzhen and dispatched him there.
Wang soon sensed an opportunity. He started BYD with a team of around 20 people and 2.5 million yuan ($351,994) that Wang borrowed from his cousin, according to The Paper.
He quickly achieved initial success by leveraging China’s cheap labor force, upending an industry once monopolized by Japanese companies.
In 2003, Wang followed his instincts, venturing into the car industry by acquiring a struggling state-owned automaker for 269 million yuan ($38 million). Its investors were worried, sending the company’s shares plunging by more than 30%. But Wang was unrepentant.
The automaker he acquired had little to offer technologically speaking, Wang recalled in the interview, so he bought many second-hand cars from around the world and took them apart to study.
“Toyota, being the world’s number one automaker, its craftsmanship, design, and products are worth learning from — only by standing on its shoulders can we reach new heights,” he said in the Tencent interview.
He was eventually vindicated, receiving a $230 million investment in 2008 from Warren Buffet, whose endorsement garnered him worldwide attention.
How can it sell its cars so cheaply?
BYD didn’t start off making cars. It was a battery maker first, which Wang said cemented the firm’s foundation and set it up for success.
“The bottleneck for electric vehicles is the battery,” he said in the Tencent interview. “If you master battery technology or accurately predict its future direction, you are essentially setting the strategic course for the entire EV industry.”
Like Apple founder Steve Jobs and Tesla CEO Elon Musk, Wang, who had studied metallurgical chemistry, was obsessed with engineering details and remains so today. He said in the Tencent interview that he spends around 60% to 70% of his time on technology and only the rest on management.
One of the innovations born out of BYD’s focus on technology is its blade battery, a lithium iron phosphate battery that it pioneered in 2020. The company said the unique shape allows it to maximize the use of available space in the battery pack while reducing the chances of catching fire when damaged.
Beyond batteries, BYD also makes a high percentage of its components in-house, relying less on external suppliers in comparison with other carmakers. This vertical integration allows it to scale up its production more easily and drive down cost significantly, according to Le.
BYD has also been known for its aggressive pricing strategy amid an ongoing price war in China and isn’t shy about asking its suppliers for discounts.
Why are its cars not available in the US?
For now, BYD and other Chinese EVs are virtually locked out of the US market due to tariffs. But as BYD evolves, Le said, trade barriers might give certain companies a “false sense of security.”
“They’re not planning to take their foot off the gas on research and development spend this year, so it’s going to be a consistent onslaught probably through the end of this decade,” he said.
Despite its lack of US presence, BYD is making inroads elsewhere.
Wang has pledged to increase its total shipments by nearly 30% this year and nearly double its overseas deliveries to more than 800,000 vehicles, according to state media.
But some challenges have emerged.
“Aside from the geopolitics, I think there are more challenges in how they operate in different countries,” said Lei Xing, an independent analyst focusing on China’s auto industry.
In Brazil, authorities said in December they had found workers working in “slavery-like conditions” at a BYD construction site. The company later denied those accusations.
In Mexico, Beijing is reportedly delaying approval for a local plant because of concerns that BYD’s smart car technology could potentially be transferred to the US, according to the Financial Times.
Still, some analysts believe BYD has become an unstoppable force. With an intense focus on technology, Xing said BYD is poised to deliver new advancements, whether in price or innovation.
“They’re just starting,” he said.
