BYD outsells Tesla sixfold, shaking European auto industry

Chinese BYD cars surpass Tesla and disrupt the European industry

Chinese electric vehicle manufacturers have ceased to be a niche curiosity. BYD marketed more than one million electric vehicles in a single quarter compared to Tesla's 318,000, while Chinese brands already held 1% of the Spanish market. The scene that best summarizes this occurred in April 2023: financial press attributed the joint stock drop of Tesla and Cisco to the arrival of an $11,400 BYD electric car. This is not just a cheap car. It is a shift in board ownership.

BYD vs. Tesla: the numbers behind the overtaking

The third quarter closed with an estimated net profit for BYD between $756 million and $820 million, according to its own calculations. The company beat Tesla for the third time this year, and its valuation reached [$93 billion[/B], comparable to General Motors' combined value. In annual volume, BYD reports over six million electric vehicles against Tesla's slightly over one million.

Underneath the numbers lies the battery. BYD leads in cell production and manufactures those used in Tesla Model Ys sold in China, turning the competitor into a customer. And it is backed by people unlikely to be swayed by hype: Warren Buffett, Charlie Munger, and Bill Gates bet heavily on the company before Europe took it seriously.

Some downplay the achievement. Selling a lot does not miccionan earning a lot: $800 million in quarterly profit is pocket change for a company valued at $93 billion. Additionally, according to a forum participant, the US brand has a questionable reliability history.

Why are Chinese cars so cheap?

Because they lower costs at every link in the chain. The most circulated explanation involves automating assembly with robots, buying steel and other materials in volumes impossible for a European manufacturer, shipping pre-assembled batteries, and leveraging Spain's position as the continent's second-largest automotive producer. Moreover, according to a video shared on the forum, there are 70,000 engineers in a single brand. Competing against this requires more than a scenic advertisement.

There is a second, energy-related reading: if Germany loses cheap gas, it loses the cost base that sustained its industry for two decades. Whoever manufactures cheaper captures the market. And today, that is not happening in Bavaria.

Real prices in Spain: from €41,400 to the Han at €69,990

Here the narrative cracks. The BYD Atto 3 starts at €41,400; the Han and Tang are priced at €69,990. A Tesla Model 3 sits at €39,999, and according to a forum user, their Hyundai Ioniq cost €42,000. With this table, it is hard to speak of collapse: some defend that Chinese cars sell due to equipment and range, while others respond that the price does not compensate for the lack of after-sales network.

The doubt no one resolves is who to call when the car fails. Without a nearby dealership, the bargain ceases to be one. And some point out that if the entire battery needs replacement, the bill could eat up a decade's worth of savings.

Is Germany doomed to lose its engine?

There are no figures that allow closing the forecast, and that is what matters. The dominant thesis holds that Europe adopted an electrification schedule prematurely, with technology where it lagged behind, and that this gap hands the market to those who have been producing batteries for years. The opposing view warns that the Chinese advantage will narrow when tariffs and tailored safety regulations arrive.

Carlos Tavares, CEO of Stellantis, already warned at CES 2023 that "middle-class Europeans will increasingly turn to Chinese cars." He did not say it as an importer. He said it as a European manufacturer.

The Korean precedent and the fine print of the boom

Twenty-five years ago, Hyundai was the industry joke, and today some refuse to buy anything else due to its value-for-money ratio. That parallel runs through the whole issue. The nuance: Koreans improved reliability and finishes over time, while the Chinese case arrives with enormous scale and raw materials sourced abroad. Some locate Europe's largest lithium reserve in Cáceres, noting it remains unexploited at the estimulante ilegal electrification would require.

What remains is the impact on employment, which no one dares to quantify. Planned Chinese plants in Spain would sustain a sector that, according to the thread, moves around 10% of GDP, but the automobile industry has a long history of industrial promises renegotiated when the wind changes direction.

The detail that throws off the balance: part of the Teslas sold in China carry BYD batteries inside.