BEIJING (Reuters) – China’s BYD saw electric vehicle sales rise 21 percent in the second quarter, narrowing the gap with Tesla as the world’s top electric vehicle (EV) seller after handing it back to U.S. rival in the first quarter.
BYD sold 426,039 electric vehicles in the April-June quarter, according to Reuters calculations based on monthly sales reports, about 12,000 fewer than Tesla’s second-quarter vehicle deliveries forecast.
Tesla is expected to report a 6% drop in vehicle deliveries in the April-June period on Tuesday, the first time the company has posted two consecutive quarterly declines as it grapples with weak demand due to stiff competition in China and a shortage of affordable new models.
If the actual results are weaker than expected, the company may once again lose the EV crown to BYD. Barclays expects second-quarter deliveries to fall 11%, which would be Tesla’s biggest ever.
According to data from the China Passenger Car Association (CPCA), Tesla’s sales of China-made EVs in June fell 24.2% from the same month last year to 71,007 units, marking the third consecutive month of year-on-year declines.
Tesla is facing obstacles after years of rapid growth that helped it become the world’s most valuable automaker. The company warned in January that delivery growth would “significantly slow” in 2024 as the boost from months of price cuts fades.
Reuters reported in May that the electric vehicle maker has been cutting production of its best-selling Model Y electric vehicle by double digits at its Shanghai factory since March to cope with fading demand for older models in China, its second-largest market after the United States.
By comparison, its biggest Chinese rival, BYD, has maintained steady growth in EV sales, while EV startups such as NIO reported impressive growth last quarter, with NIO’s vehicle deliveries more than doubling to 57,300 in the second quarter.
Cui Dongshu, secretary-general of the China Electric Vehicle Association, said price cuts and growing consumer demand to switch from gasoline-powered cars to electric and hybrid vehicles were the main reasons for strong sales at Chinese electric vehicle makers in recent months.
According to data from the China Association of Automobile Manufacturers (CPCA), sales of new energy vehicles, including electric vehicles and plug-in hybrids, in China accounted for 46.7% of total auto sales in May, a new monthly record.
(Reporting by Chaoyi Li, Zhang Yang and Kevin Krolicki; Editing by Miyoung Kim and Shelley Jacob Phillips)
