(Repost) Bloomberg -- Tesla Falls Behind China’s BYD in Quarterly EV Sales as Growth Slows

(Credit: Transcript by OpenAI Whisper)

Tesla falls behind China's BYD in quarterly EV sales as growth slows. Tesla Incorporated delivered more vehicles than expected in the fourth quarter, though not enough for the Elon Musk-led company to stay ahead of China's BYD company in global electric car sales. Tesla handed over 484,507 vehicles in the last three months, beating analysts' average estimate for 483,173 deliveries. BYD sold 526,409 fully electric vehicles in the quarter to become the new number one in EVs, driven mainly by its much broader lineup of cheaper models in China. Read more, BYD posts record sales quarter in challenge to Tesla. While Tesla exceeded its target to deliver 1.8 million vehicles for the year, the Austin-based carmaker came up well short of an upside scenario Musk touted 12 months ago. After the chief executive officer told analysts the company had the potential to produce 2 million cars, a series of price cuts failed to stoke enough demand to support that much output. Tesla shares fell as much as 1.6 percent shortly after the start of regular trading Tuesday in New York. The stock soared 102 percent last year, rebounding from a record loss in 2022 linked to Musk's takeover of Twitter, the social media company now known as X. The change in EV sales rankings reflects China's growing cloud in the global automotive industry. After surpassing the U.S., South Korea and Germany the last few years, China may have overtaken Japan as the world's largest passenger car exporter in 2023. Read more, Tesla loses world's most popular EV maker title to China's BYD. Tesla generates more revenue and profit than BYD because it sells much higher-priced vehicles and relies on just two models for the lion's share of its sales. The Model Y sport utility vehicle and Model 3 sedan accounted for 95 percent of deliveries in the fourth quarter. Musk expanded Tesla's lineup late last year, starting sales of the Cybertruck years behind schedule. The company didn't break out how many of the stainless steel clad pickups it produced and delivered before year end. The Cybertruck launch marked Tesla's entry into the highly competitive truck market in the U.S. Musk has cautioned that it may take the company 12 to 18 months to reach volume production and generate positive cash flow with the vehicle, which is difficult to build and pack with new technology. Read more, Musk's Cybertruck is already a production nightmare for Tesla. Although Tesla doesn't break out quarterly vehicle sales by region, the U.S. and China are its largest markets. The company makes the Model S, X, 3 and Y in Fremont, California, and the Model 3 and Y in Shanghai. It also produces the Model Y at its plants in Austin and outside Berlin.

Key Takeaways from the Article:

1. Tesla's Fourth Quarter Performance: Tesla Incorporated delivered 484,507 vehicles in the fourth quarter, slightly exceeding the average analyst estimate of 483,173 deliveries.

2. BYD Overtakes Tesla in EV Sales: China's BYD Company sold 526,409 fully electric vehicles in the same quarter, surpassing Tesla to become the world's leading EV seller. BYD's success is attributed to its broader lineup of more affordable models in China.

3. Tesla's Annual Target and Missed Upside Scenario: While Tesla surpassed its target to deliver 1.8 million vehicles for the year, it fell short of the 2 million car production potential that CEO Elon Musk mentioned earlier. Price cuts by Tesla failed to generate enough demand to reach this higher output.

4. Tesla's Stock Movement: Tesla's shares experienced a drop of 1.6 percent in early trading following the sales announcement. The company's stock had previously soared 102 percent in the last year, recovering from a significant loss in 2022.

5. China's Growing Influence in Global Auto Industry: The shift in EV sales rankings highlights China's increasing dominance in the automotive sector, potentially surpassing Japan as the world's largest passenger car exporter.

6. Tesla’s Revenue and Profit Dynamics: Despite selling fewer vehicles than BYD, Tesla generates more revenue and profit due to its focus on higher-priced vehicles like the Model Y SUV and Model 3 sedan, which together accounted for 95 percent of its fourth-quarter deliveries.

7. Cybertruck Launch and Production Challenges: Tesla began selling the much-anticipated Cybertruck late last year, though production and delivery numbers were not disclosed. The launch marks Tesla's entry into the competitive U.S. truck market, with Musk indicating potential production and cash flow challenges for the vehicle.

8. Tesla's Market Focus and Manufacturing: The U.S. and China remain Tesla's largest markets, with production facilities in Fremont, California, and Shanghai, as well as additional production of the Model Y in Austin and near Berlin.

The article provides insights into the latest developments in the EV market, particularly Tesla's performance in comparison to BYD and the broader dynamics of the global automotive industry.