Tesla’s deliveries dropped for the second consecutive year, falling roughly 9% to 1.64 million|Wayne Hsieh|CC BY-NC-SA 2.0
There is a new king on the EV throne: BYD. The Chinese automaker effectively dethroned America’s Tesla as the world’s top electric vehicle manufacturer in 2025.
Annual data reveals that BYD’s sales surged nearly 28% to exceed 2.25 million units while Tesla’s deliveries dropped for the second consecutive year, falling roughly 9% to 1.64 million.
The gap widened significantly in the fourth quarter, when Tesla’s sales plummeted 16% after the Trump administration ended the $7,500 EV tax credit. Customers revolting against CEO Elon Musk’s political stance also slowed spending in the auto sector, and rising low-cost rivals also contributed to the sales slump.
To stimulate demand, Tesla launched lower-priced versions of the Model 3 and Model Y in October. The move failed to prevent the year-end slide.
Despite the challenges, Tesla’s stock rose 11% in 2025, and the company board approved Musk’s record-breaking $1 trillion pay package.
CEO Musk is touting Tesla’s robotaxis and humanoid robot Optimus, signaling a strategic pivot from traditional car manufacturing to a robotics and AI-driven valuation.
Meanwhile, BYD enters a cooling domestic market. China is scaling back consumer purchase incentives, and aggressive competition from rivals like Geely and Xiaomi is tightening margins.