BYD set to overtake Elon Musk's Tesla as the world's top electric vehicle seller in 2025

Chinese electric vehicle (EV) giant BYD is set to overtake Tesla as the world’s largest EV maker by annual sales in 2025.

According to Nikkei Asia, BYD said its global EV sales rose 28 per cent in 2025 to about 2.25 million units.

While Tesla has yet to release its final figures, it released a market estimate on Dec. 29, 2025, which indicated a drop of about 8 per cent to roughly 1.64 million vehicles.

Elon Musk, the world's richest man, is the CEO of Tesla.

If confirmed, this would be the first time the Chinese automaker has surpassed its U.S. rival on a calendar-year basis.

Close competition in 2024

In 2024, Tesla narrowly retained its lead over BYD by just over 20,000 vehicles, Nikkei reported.

This year, however, BYD appears to have overtaken its U.S. competitor by a substantial margin.

Reasons for BYD's rise

BYD’s rapid rise has been driven by its massive market in China, as well as accelerating overseas expansion.

Nikkei reported that BYD's total vehicle sales climbed 8 per cent to 4.6 million units in 2025, its fifth consecutive year of growth, allowing the company to surpass Japan’s Honda Motor and Nissan Motor in annual sales last year.

Among passenger cars, which account for more than 90 per cent of BYD’s sales, EVs reached 2.25 million units, while plug-in hybrid sales slipped 8 per cent to 2.28 million units.

With the global scale of the Chinese company, it is said to be able to leverage economies of scale and secure parts more cheaply, strengthening its price competitiveness.

BYD's overseas sales also rose sharply, supported by strong performance in Europe and expansion into Latin America and Southeast Asia.

The company also brought a manufacturing plant online in Brazil in 2025 and plans to use its Thailand facility to supply both local markets and exports to Europe.

According to AFP, as cited in The Straits Times, the company is also building production capacity in Hungary as it seeks to mitigate the impact of European tariffs on Chinese EVs .

However, despite its growth, BYD faces challenges.

Data has shown that its sales declined year-on-year in September 2025 for the first time in 19 months, while December deliveries fell 18 per cent from a year earlier, marking the fourth straight month of decline.

One of the reasons could be that its profitability in China has been weighed down by price-sensitive consumers, amid intensifying competition from rivals such as Geely and new entrants including Xiaomi.

Tesla had a difficult year

AFP reported that by the end of September 2025, the U.S. automaker had sold about 1.22 million EVs, a figure that included a one-off surge ahead of the expiration of a US$7,500 (around S$9,628) tax credit for EV buyers.

That subsidy ended under legislation backed by U.S. president Donald Trump, and industry watchers suspect it may take time for EV demand in the country to stabilise following the removal of government incentives.

Tesla's sales are also expected to have softened further in the fourth quarter of 2025, with analysts forecasting deliveries of between 405,000 and 449,000 vehicles.

This would bring Tesla’s full-year total to about 1.65 million units, down 7.7 per cent from a year earlier.

Top photos via BYD and Tesla Millenia Walk/Google Maos