Tesla’s dominance in China is slipping as Chinese electric carmakers like BYD gain traction with consumers. The company’s sales in China plummeted 14% year-over-year, while its rival BYD sold 481,318 cars in the first two months of this year alone.
Chinese buyers are turning to local brands for more efficient cars and better technology, often at half the price of Tesla. Xiaomi’s sports sedan was one of the top choices for Liu Jie, a 32-year-old consumer who test-drove several Chinese cars before opting for the less expensive option.
Tesla’s biggest challenge in China is not its brand reputation or Elon Musk’s leadership but rather the increasing competition from local rivals like BYD. The company’s sales are being impacted by criticism over Musk’s role as an aide to President Trump, which has led to a decline in investor confidence and a 25% drop in Tesla’s value over the past month.
Despite this, luxury buyers remain loyal to Tesla, and advanced technology features like self-driving are still in high demand. However, the company faces another hurdle: slowing demand for all cars in China.
Policies aimed at promoting electric vehicles have helped increase sales, but the market is becoming increasingly saturated. Dealers are struggling to sell any car, with some even leaving their dealerships due to lack of demand. As a result, Tesla’s competitiveness in China may only last for another two or three years, according to some dealers.
With its Autopilot technology now available in China, Tesla has made strides to regain some ground. However, Chinese consumers are still looking for better deals and more efficient options, which local brands like BYD are providing.
Source: https://www.nytimes.com/2025/03/13/business/tesla-china-sales-elon-musk.html