China's BYD has overtaken Tesla to become the world's largest seller of electric vehicles, marking a symbolic and commercial turning point in the global auto industry as competition intensifies and growth slows across major markets. The milestone comes after BYD reported global sales of 2.26 million battery-electric vehicles in 2025, while Tesla said it delivered about 1.64 million vehicles during the same period, its second consecutive annual decline.
The shift in leadership underscores a dramatic reversal from more than a decade ago, when Tesla Chief Executive Elon Musk dismissed BYD as a serious rival. Speaking to Bloomberg Television in 2011, Musk laughed at the suggestion and said, "I don't think they have a great product." Fourteen years later, BYD's scale, pricing power and international expansion have reshaped the competitive landscape.
BYD said its battery-electric vehicle sales rose nearly 28% last year, even as the company grappled with price wars and slowing demand in China, its largest market. Tesla, by contrast, reported an 8.6% drop in annual deliveries in 2025, following a smaller decline the year before. Fourth-quarter deliveries fell roughly 16% from a year earlier, reflecting weaker demand and intensifying competition.
Tesla does not break out sales by region, but company filings show the United States accounts for nearly half of its revenue. Analysts say the company faced pressure in several areas at once, including slowing EV adoption, rising competition from Chinese manufacturers and political backlash tied to Musk's public role in the Trump administration.
Key delivery and sales figures highlight the diverging trajectories:
- BYD 2025 EV sales: 2.26 million units, up nearly 28%
- Tesla 2025 deliveries: about 1.64 million vehicles, down 8.6%
- Tesla Q4 2025 deliveries: about 418,000, down 15.6% year over year
- BYD total vehicle sales (EVs and hybrids): more than 4.6 million
Tesla shares have nevertheless rebounded sharply in recent months, closing 2025 up 18.6% and hitting a record closing price of $489.88 last month. Investors have rallied around Musk's promises of a future built on autonomous driving and robotics, including a fleet of robotaxis and humanoid robots. Musk has said the company has been testing driverless vehicles in Austin, Texas, "with no one in the car," though deployment remains limited to a small number of locations.
Earlier in the year, Tesla shares had fallen amid protests and backlash linked to Musk's political activities, including demonstrations outside showrooms in Europe and the United States. The company also faced a pull-forward effect in the third quarter, when buyers rushed to purchase vehicles before a $7,500 U.S. federal tax credit expired on Oct. 1.
