China's BYD (SZ:002594) reported a 21% increase in second-quarter electric vehicle (EV) sales, narrowing the gap with Tesla (NASDAQ) after losing its position as the world's top EV vendor to the U.S. rival in the first quarter.
BYD sold 426,039 EVs in the April-June period, according to Reuters' calculations based on its monthly sales reports. This figure falls about 12,000 vehicles short of estimated Tesla deliveries for the same quarter.
Tesla is expected to announce a 6% decline in vehicle deliveries for the April-June period on Tuesday, marking its second consecutive quarter of decline. The company faces stiff competition in China and subdued demand due to a lack of new affordable models.
If actual results fall below estimates, Tesla could relinquish its EV leadership to BYD once more, with Barclays forecasting an 11% drop in second-quarter deliveries, the largest decline in Tesla's history.
After years of rapid growth, Tesla has encountered challenges, warning earlier this year of significantly slower delivery growth in 2024 as price reductions lose their impact.
Since March, Tesla has scaled back production of its popular Model Y electric car at its Shanghai facility in response to weakening demand for its older models in China, its second-largest market after the United States, as reported by Reuters in May.
In contrast, BYD has sustained consistent growth in EV sales, while newcomers like Nio (NYSE) reported remarkable growth last quarter, with NIO's vehicle deliveries more than doubling to 57,300 units in the second quarter.
According to Cui Dongshu, secretary general of the China Passenger Car Association (CPCA), price cuts and a shift in consumer preference towards EVs and hybrids over traditional gasoline-powered vehicles have been key factors driving strong sales for Chinese EV manufacturers in recent months.
In May, new energy vehicle sales, including EVs and plug-in hybrids, accounted for 46.7% of total car sales in China, marking a new monthly high based on CPCA data.
Paraphrasing text from "Reuters" all rights reserved by the original author.
