Chinese carmaker BYD is set to dethrone Elon Musk’s Tesla as the world’s largest seller of electric vehicles (EVs), marking a historic shift in the global automotive industry.
Annual figures released by the Shenzhen-based firm on Thursday show its battery-powered car sales jumped by nearly 28% last year, reaching more than 2.25 million vehicles.
Tesla is expected to report its 2025 totals later today, but analyst estimates suggest the US firm will fall short with approximately 1.65 million sales—the first time it has trailed its Chinese rival over a full year.
A year of pressure for Musk
The milestone comes after a turbulent 12 months for Tesla. While the company remains a pioneer in the sector, it has faced several headwinds:
- Political backlash: Sales slumped in early 2025 following public unease over Mr Musk’s prominent role in Donald Trump’s US administration.
- Competition: Chinese rivals like Geely, MG, and BYD have squeezed Western brands by significantly undercutting them on price.
- Divided focus: Investors have raised concerns that Mr Musk’s attention is split between Tesla and his other ventures, including SpaceX, the social media platform X, and his role leading the US government’s Department of Government Efficiency (Doge).
In an effort to regain momentum, Mr Musk has recently pledged to “significantly” cut back his government role to focus on Tesla’s ambitious 10-year plan, which involves selling a million humanoid “Optimus” robots and launching a fleet of “Robotaxis.”
BYD’s global surge
BYD’s rise has been fuelled by its aggressive international expansion, particularly in Latin America, South East Asia, and Europe.
Remarkably, the UK has emerged as BYD’s biggest market outside of China. Sales in Britain surged by a staggering 880% in the year ending September 2025, driven largely by the popularity of its Seal U plug-in hybrid SUV.
This growth comes despite several Western countries imposing steep tariffs on Chinese-made electric vehicles in an attempt to protect local manufacturers.
The $1 trillion incentive
Despite the sales slip, Mr Musk’s personal stakes remain high. In November, Tesla shareholders approved a record-breaking pay package that could see the billionaire receive a payout of as much as $1tn (£740bn) over the next decade.
To secure the deal, however, Mr Musk must hit massive targets for Tesla’s stock market value and production—goals that look increasingly challenging as Chinese manufacturers continue to dominate the affordable end of the EV market.
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