BusinessJan 4, 2026
Tesla Surrenders EV Crown to BYD Following Second Straight Year of Falling Sales
Automotive Rivalry
Rhea Lobo
The EV race has a new leader. Tesla has lost its spot as the world’s top electric vehicle seller to China’s BYD after a second consecutive year of declining deliveries. It’s a sharp turnaround for Elon Musk, who famously laughed off BYD in a 2011 Bloomberg interview, saying he didn’t “think they have a great product.”
- BYD surged ahead in 2025, selling 2.26M battery-electric vehicles — nearly 28% more than a year earlier — while Tesla’s deliveries fell 8.6% to 1.64M units.
- Tesla’s fourth-quarter deliveries dropped 16% to 418.2K vehicles, missing analyst expectations, while BYD continues to widen its lead by selling more than 2M plug-in hybrids annually.
Losing ground: Despite weaker vehicle sales, Tesla shares still rose 11% in 2025 as investors shifted focus away from cars and toward Elon Musk’s AI and robotaxi ambitions. Wall Street has also lowered expected 2026 vehicle sales to around 1.8M as EV incentives fade and competition grows. As analyst Jed Dorsheimer puts it, the stock “is valued almost entirely on the transformation to real-world AI.”
