While long-time leader Tesla's supremacy in the global EV race wanes, Chinese carmaker BYD is gaining speed. On Monday, the Warren-Buffett funded automaker announced that sales of "new-energy" vehicles, which encompass electric and plug-in hybrid models, increased by 13% compared to the previous year. About 300,114 of the 626,263 vehicles sold by the company in the first quarter were electric vehicles only.
Despite a decline in sales in January and February, the company reported a 46% increase in March transactions. In stark contrast to Elon Musk's electric vehicle manufacturer Tesla, whose stock has fallen over 30% year-to-date, BYD had a great first quarter.
Following rumors of a production cutback at Tesla's Shanghai factory, numerous experts have lowered their predictions for the company's first quarter vehicle deliveries, which is a rough indicator of sales.
After originally estimating 475,000, Wedbush Securities lowered their number to 425,968. According to Wedbush's forecast, Tesla's vehicle deliveries will have increased by less than 1% year-on-year, surpassing BYD's pure EV sales in the same time frame. On Tuesday, Tesla is scheduled to announce the sales of its first quarter vehicles.
Rivalry from BYD and other Chinese automakers has been heating up, even though Tesla has enjoyed years of tremendous growth. The automaker finally overtook Tesla as the top global seller of electric vehicles on a quarterly basis at the end of last year.
To the chagrin of Western governments and well-established automakers like Nissan, Honda, and Tesla, the worldwide electric vehicle competition has recently heated up, particularly as cheaper Chinese vehicles gain ground overseas. After a slower start to the year, Chinese automakers Li Auto, Xpeng, Nio, and BYD all announced sales increases in March.
Wedbush's Dan Ives warned that Tesla is in a "code red situation," echoing concerns expressed by both Tesla's detractors and supporters. Ives maintained his outperform recommendation and $300 price objective for the company. Upwards of $175 per share was the stock price on Tuesday.
Recently, Tesla abandoned its resistance to digital advertising in an effort to increase sales. Musk has also offered a free trial of its $12,000/year "Full Self-Driving" option to entice additional consumers. Nonetheless, Musk has warned investors that their Tesla investment may see "notably lower" sales growth in 2018.
View for more updates