Tesla loses EV crown to China's BYD as competition rises, tax credit ends

US carmaker's annual sales fall as brand also hit by political rhetoric of CEO Musk

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Chinese carmaker BYD said sales outside the country climbed to a record one million vehicles in 2025, up about 150 per cent from 2024.

(PHOTO: AFP)

Tesla ceded its crown as the world's top electric vehicle (EV) maker to China's BYD after annual sales fell for a second year, with intensifying competition, the expiration of US tax credits and damage to the carmaker's brand hurting demand.

With global EV sales rising 28 per cent in 2025, BYD outsold Tesla for the first time on an annual basis, helped by rapid growth in Europe where the Chinese carmaker has been widening its lead over the US rival.

The annual deliveries figure raises questions about whether Tesla can stabilise its core car business following two consecutive years of sales declines, even as it pivots to futuristic projects such as robotics and self-driving cars to justify its steep valuation.

Tesla shares were marginally up in early trading on Jan 2.