Chinese automaker BYD has dethroned Tesla as the global leader in pure electric vehicle (EV) sales for the first time, marking a significant shift in the rapidly evolving EV market.
BYD reported sales of approximately 2.26 million battery-electric vehicles (BEVs) in 2025, a robust 28% increase from the previous year. This figure propelled the Shenzhen-based company ahead of Tesla, which delivered around 1.636 million vehicles worldwide—an 8.6% decline from 2024 and its second consecutive year of falling sales.
Tesla’s fourth-quarter deliveries came in at 418,227 vehicles, down 16% from the same period in 2024 and slightly below analyst expectations. The company highlighted strong growth in its energy storage business, deploying a record 14.2 GWh in Q4 and 46.7 GWh for the full year.
The contrasting fortunes underscore intensifying global competition, particularly from Chinese manufacturers. BYD benefited from aggressive overseas expansion, with exports surpassing 1 million units—up 150% year-over-year—and strong demand in markets like Europe, where its registrations surged. Tesla, meanwhile, grappled with challenges including the expiration of U.S. federal EV tax credits in September 2025, a stagnant model lineup, and regional sales drops in Europe amid broader market shifts.
Analysts note that while BYD also sells plug-in hybrids (bringing its total new energy vehicle sales to about 4.55 million), its BEV performance alone now outpaces Tesla’s entire output. BYD’s growth came despite a slowdown in China’s domestic market due to fierce price competition.
Tesla CEO Elon Musk has increasingly positioned the company beyond traditional autos, emphasizing advancements in autonomy, AI, robotics, and energy. Investors appeared optimistic about these prospects, with Tesla shares showing modest gains in early 2026 trading despite the delivery shortfall.
The milestone highlights China’s rising dominance in EVs, fueled by affordable models, rapid innovation in batteries, and government support. For Tesla, it raises questions about revitalizing vehicle demand while pursuing ambitious tech ventures.
Tesla’s full financial results for Q4 2025 are scheduled for release on January 28, 2026.