How Chinese electric automaker BYD is on track to surpass Tesla in sales this year, and the strategies that are propelling its success over Elon Musk’s company.

China’s Influence in the Electric Vehicle Market

China, the world’s biggest market for electric vehicles (EVs), boasts 64% of total EV production and 59% of global EV sales in 2022. With ambitions of becoming a global powerhouse in the EV sector, China’s major player, BYD, is on track to usurp Tesla’s position as the world’s leading electric car manufacturer. The fourth quarter data’s predicted release in early January raises expectations that BYD’s sales numbers will eclipse those of Elon Musk’s Tesla.

An essential factor in establishing BYD’s dominance in the EV market is the affordability of their electric vehicles. BYD’s Seagull, sold at a mere $10,000, has managed to secure its place as the fourth best-selling EV in China, contrary to Tesla, known for its premium price tags. By embracing an affordable pricing strategy, BYD has successfully appealed to a broader customer base, setting its vehicles apart as appealing options for both connoisseurs and novice car drivers.

Notably, China’s control of the EV battery supply chains and its government’s strategic investments in building charging networks have significantly contributed to the proliferation of EVs. Evidently, the culmination of significant advantages in the battery supply chain, as well as dominant positions in labor, manufacturing, and critical material mining infrastructure, positions China as the leader in this tech sector. The development of an extensive highway charging network has also played a pivotal role in the mainstream adoption of EVs among the public, particularly in China and Norway – where EV and plug-in hybrid cars have dominated new car sales.

Several predictions indicate that the success of the EV market in China is likely to continue into 2023. Rho Motion data reported by Reuters suggests that record EV sales in October signal a trajectory for strong sales in the coming months. Despite the marked success in China’s domestic market, BYD’s North American chief, Stella Li, has commented that the company may not yet sell its cars in the American automotive market, a move that could provide a significant opportunity for Tesla to maintain a foothold in its home market.

Notably, as growth falters in China’s economy, the electric vehicles sector remains a beacon of hope and growth; the focus on local battery supply chain control and charging networks has substantially boosted EV sales in China, forecasting another strong year for the electric vehicle market.