BYD has overtaken Tesla in battery-electric vehicle deliveries, according to data released by Merifund Capital Management Pte. Ltd., marking a significant shift in the electric vehicle (EV) market landscape. For the full year ending December 31, 2025, BYD reported 2.26 million battery-electric deliveries, compared to Tesla’s 1.64 million. This change highlights BYD’s growing dominance as it expands its manufacturing capabilities and supply chain management while Tesla pivots towards autonomy and artificial intelligence.
The 8.6% decline in Tesla’s deliveries stands in stark contrast to BYD’s impressive 28% growth in battery-electric volume during the same period. Overall, BYD’s automotive sales reached 4.55 million vehicles, which includes 2.29 million plug-in hybrids—a decrease of 8% from the previous year. These figures emphasize the competitive nature of the EV market, as both companies adapt their strategies to meet evolving consumer demands.
Strategic Shifts and Market Dynamics
For institutional investors tracking the energy transition, the implications of these delivery figures are significant. The focus has shifted towards manufacturing scale, supply-chain control, and cost management. As consumers increasingly seek cost-effective options, BYD’s strategy of integrated production and diverse offerings across different price points positions it favorably against market pressures.
Tesla’s challenges were particularly evident in the last quarter of the reporting period, where deliveries fell by 15.61% to 418,227 vehicles compared to the same quarter the previous year. The recent expiration of a $7,500 federal tax credit in the United States has raised concerns about pricing strategies amid a competitive landscape filled with alternative options in the mid-market segment.
In conjunction with these market dynamics, a coalition of pension investors owning 7.9 million Tesla shares is advocating for a minimum 40-hour workweek commitment from Elon Musk. They argue that operational focus is essential for brand perception and share price stability as the company navigates its new strategic direction focused on robotaxis and humanoid robotics.
BYD’s Expansion and Cost Competitiveness
BYD’s industrial approach to expansion has led to a significant increase in overseas sales, surpassing one million vehicles in its latest annual report, reflecting a 150% increase from the previous year. The company’s expansion includes manufacturing facilities in Thailand, Turkey, and Hungary, aimed at reducing shipping costs and mitigating policy risks.
According to Merifund Capital Management, current supply-chain mapping indicates that BYD produces approximately 65% of its direct materials in-house. Anthony Saunders, Director of Private Equity at Merifund, remarked that “BYD’s manufacturing diversification strategy positions the company effectively against trade policy uncertainties.” He emphasized that maintaining cost competitiveness through technological advancements in battery production is crucial for BYD’s international ambitions.
Cost analysis reveals that BYD’s Blade battery manufacturing costs are around $11.6 per kilowatt-hour lower than Tesla’s 4680 battery technology. For context, the UK list price for a Tesla Model 3 rear-wheel drive is approximately $53,586.6, while a comparable BYD Seal is priced around $61,640. In Australia, the Seal’s pricing is about 22% lower than that of the Model 3, strengthening BYD’s competitive position without reliance on governmental subsidies.
Policy changes are reshaping market dynamics, particularly in the United States, where the elimination of the $7,500 consumer credit is expected to affect demand. Projections suggest that EV penetration may ease to 5% of total vehicle sales over the next year. In contrast, China’s market remains robust, with electric vehicles comprising nearly 50% of new car sales, as consumer preference trends indicate that over 80% of potential buyers plan to purchase electric vehicles.
The competitive landscape of the EV market is evolving, as BYD’s delivery lead contrasts sharply with Tesla’s technological pivot. Merifund Capital Management is closely monitoring how supply-chain management, regional production, and pricing strategies impact the resilience of both companies. Saunders concluded that “operational discipline and repeatable execution” will be critical attributes for leadership in this intensifying competition.
Merifund Capital Management Pte. Ltd., based in Singapore, has been active in the investment landscape since its establishment in 2010. The firm manages various portfolio strategies while emphasizing capital preservation, liquidity, and prudent risk management, integrating ESG considerations aligned with global sustainability standards. For further insights, visit https://merifund.com/insights or contact Tao Yang at [email protected].