Musk once laughed off BYD as a threat. Now the Chinese giant has taken Tesla’s EV crown — here’s how
Chinese automaker BYD had one of the biggest stands at the IAA show in Munich, Germany in 2023.
Arjun Kharpal | CNBC
Elon Musk dismissed BYD in 2011 by laughing at their products during a Bloomberg interview.
“Have you seen their car?” Musk quipped. “I don’t think it’s particularly attractive, the technology is not very strong. And BYD as a company has pretty severe problems in their home turf in China. I think their focus is, and rightly should be, on making sure they don’t die in China.”
BYD did not get wiped out. Instead, BYD dethroned Tesla in the fourth quarter as the top EV maker, selling more battery-powered vehicles than its U.S. rival.
“Their goal was to be China’s largest auto manufacturer and put China manufacturing on the map,” Taylor Ogan, CEO of Snow Bull Capital, said of BYD’s long-standing ambition.
So how did the Chinese company, which began by making phone batteries, become an electric car giant?
BYD’s history
While BYD is now known as an electric car giant, its tentacles stretch into many areas from batteries to mining and semiconductors, which is a large reason behind its success.
Chemist Wang Chuanfu founded BYD in 1995 in the southern Chinese city of Shenzhen, China’s massive tech hub. It was founded with 20 employees and 2.5 million Chinese yuan of capital, or $351,994 at today’s exchange rate.
In 1996, BYD began manufacturing lithium-ion batteries, the type that are in our modern day smartphones. This coincided with the growth of mobile phones. BYD went onto supply its batteries to Motorola and Nokia in 2000 and 2002, respectively, two of the mobile phone industry’s juggernaughts at the time.
In 2002, BYD listed on the Hong Kong Stock Exchange, riding the wave of its success in lithium-ion batteries.
BYD’s pivot to autos
It wasn’t until 2003 that BYD acquired a small automaker called Xi’an Qinchuan Automobile.
Two years later, it launched its first car called the F3, which was a combustion model. And then in 2008, it launched the F3DM, its first foray into electric vehicles. The F3DM was a plug-in hybrid electric vehicle.
That same year Warren Buffett’s Berkshire Hathaway made what was at the time a $230 million investment in BYD.
This gave a boost to BYD’s electric car ambitions.
BYD continued to push into the EV space and this is where its history as a battery maker came into play. In 2020, the company launched the Blade battery, which many argued helped spark BYD’s growth in EVs.
It is an LFP or lithium iron phosphate battery. At the time, according to Ogan, many battery makers were moving away from LFP batteries due to perceptions that they had poor energy density, i.e. they were too heavy for the amount of energy they were able to provide.
But BYD touted the Blade as a breakthrough that provided good energy density and high levels of safety. It committed to putting this in its Han, a sporty sedan which was released in 2020 and seen as a rival to Tesla’s Model S. BYD then put the Blade in subsequent models it released.
“The energy density at the cell level and the pack level were actually higher than what BYD initially unveiled … Everyone was blown away,” Ogan said.
BYD sold 130,970 pure battery electric vehicles in 2020. Last year, the company sold 1.57 million battery EVs.
What has been behind BYD’s success?
The breakthrough with the Blade underlines why BYD has found success in EVs — strategic investments and the fact that it has more businesses than just cars.
“BYD cut their teeth being a supplier in the high tech space, building up resiliency by supplying batteries to hard to please companies like Apple,” Tu Le of Sino Auto Insights, told CNBC.
“Wang Chuanfu then had the wherewithal to acquire a broken down local Chinese automotive brand and was able to focus on innovating on battery tech, enough so that it can sell to other automakers. If that wasn’t enough they were head down grinding, continually improving the design, engineering and quality of it’s own stable of vehicles. We didn’t know this at the time, but everything it’s done over the last 15-20 years set it up to surpass Tesla in Q4 ’23.”
Wang Chuanfu, Chairman and President of BYD.
May Tse | South China Morning Post | South China Morning Post | Getty Images
At the start, BYD did not jump straight into pure EVs. The company still sold hybrid cars, which Alvin Liu, analyst at Canalys, said was key to BYD’s initial success.
“In the early stages of the Chinese EV market, BYD chose to simultaneously launch Battery Electric Vehicles (BEV) and Plug-in Hybrid Electric Vehicles (PHEV). This strategy allowed BYD to win the market when charging infrastructure was not well-established, and users were not very clear about the advantages of EVs,” Liu told CNBC.
“PHEV’s characteristics like high economic efficiency and not having range anxiety played a significant role in helping BYD to win the market.”
Liu said BYD postioned itself in the mid-range market where there were fewer competitors in China which helped propel its growth. BYD has done well on branding, according to Liu, creating differetn sub-brands to tackle different price points in the market. One such example is BYD’s mid-to-high-end EV brand Denza.
Beijing backs EVs
As well as BYD’s own tactics, its rise has been helped by the Chinese government’s huge support of the country’s EV sector. Over the past few years, Beijing has offered subsidies to incentivize buyers of electric cars and offered state support to the industry. These measures began around 2009, at the time BYD was looking to ramp up its EV push.
Rhodium Group estimates that BYD received approximately $4.3 billion in state support between 2015 and 2020.
“BYD is a highly innovative and adaptive company, but its rise has been inextricably linked to Beijing’s protection and support,” Gregor Sebastian, senior analyst at Rhodium, told CNBC. “Without Beijing’s backing, BYD wouldn’t be the global powerhouse it is today.”
“Over time, the company has enjoyed below-market equity and debt financing allowing it to scale up production and R&D activities.”
Global ambitions
After dominating China’s EV market, BYD is now epanding aggressively overseas. It sells cars in a number of countries from the United Arab Emirates to Thailand and the U.K.
In southeast Asia, BYD has a 43% market share in electric vehicles. But BYD’s interntional expansion is not just about selling cars, it involves manufacturing and materials too.
BYD said in December it would open its first European manufacturing plant in Hungary. And the company is also looking to buy lithium mining assets in Brazil. Lithium is a key component of BYD’s batteries.
However, with global expansion comes scrutiny from governments who are concerned about the subisides that Chinese carmakers have received.
In September, the European Commission, the executive arm of the European Union, launched an investigation into subsidies given to electric vehicle makers in China.
Meanwhile the U.S. is trying to boost its own domestic EV sector through the Inflation Reduction Act, with an aim of keeping out Chinese competitors.
“Initiatives like the IRA and the EU anti-subsidy probe aim to impede China’s progress in these markets,” Rhodium’s Sebastian said.
“To ensure sustained growth, BYD is proactively addressing these political hurdles, as seen in its recent investment in an EV plant in Hungary, underscoring its commitment to global expansion.”
What next?
The battle between Tesla and BYD — the world’s two biggest EV makers — is set to continue. Sino Auto Insights’ Le said he beleives that BYD still hasn’t “reached max potential.”
“Most automotive companies for the longest time didn’t take them seriously. That’s where part of their journey mirrors Tesla’s because people didn’t take Tesla seriously in the early days either,” Le said.
As for Tesla, the company is facing stiffer competition in 2024 with Chinese competitors launching more models and traditional automakers trying to catch up in the EV race.
Daniel Roeska, senior research analyst at Bernstein Research, told CNBC that there isn’t a big driver of sales volumes in Tesla’s car portfolio in the coming months. BYD on the other hand could see faster growth.
“BYD quite to the contrary is really pushing the pedal to the metal … by accelerating growth in Europe and other overseas markets. And so there is a lot more growth in the BYD story in the next 12 to 24 months for sure,” Roeska said.
Tesla’s Musk has recognized that he shouldn’t have taken BYD lightly. In a comment posted in X in response to a video of his 2011 Bloomberg interview, Musk said: “That was many years ago. Their cars are highly competitive these days.”
Apple CEO Tim Cook speaks during the Apple Worldwide Developers Conference (WWDC) on June 09, 2025 in Cupertino, California.
Justin Sullivan | Getty Images News | Getty Images
Apple‘s annual developer conference on Monday lacked the splashy announcement that fans are used to seeing at WWDC. There was nothing like the Vision Pro reveal from 2023 or the Apple Intelligence announcement last year.
But there was an important software update that, later this year, will change the way all of Apple’s major devices, from iPhones and Mac laptops to Vision Pro virtual reality headsets, will look. It’s a new design language that runs across all of Apple’s operating systems. The company is calling it Liquid Glass.
For Apple, it’s the first significant redesign of its iPhone operating system since 2013, when the company announced iOS7. Apple says the lock screen will look like it’s made out of glass. Buttons will turn into little glass pills, fluidly sliding over glass rails. And there are new animations, including when answering a phone call.
The unveiling underwhelmed Wall Street, which sent the stock down 1.2% on the day. Investors are pressuring Apple to make big changes to its artificial intelligence strategy, pushing it to match the frontier models capabilities of rivals such as Google and OpenAI.
“Many of the AI features announced were more incremental in our view, and already available through competitor applications,” UBS analyst David Vogt wrote in a note on Monday. He has the equivalent of a hold rating on the stock.
Last year, Apple announced Apple Intelligence, its response to ChatGPT, complete with a demo of a “more personal” Siri that could intelligently parse through emails and messages to figure out the best time to make a restaurant reservation. Apple delayed the feature in March, had to pull ads that depicted it, and provided no update on timing on Monday.
“This work needed more time to meet our high quality bar,” Apple software chief Craig Federighi said on Monday. He restated the company’s “the coming year” timeline.
Liquid glass design
Apple’s focus at WWDC was on providing new features and animations across its software that are “delightful,” in CEO Tim Cook’s words.
The new design language is heavy on transparent buttons, sliders, and other interaction elements. Users will be able to spot it as soon as they upgrade their phones to the new iOS, which will be available for beta testing this summer.
Apple announces liquid glass during the Apple Worldwide Developers Conference (WWDC) on June 9, 2025 in Cupertino, California.
Justin Sullivan | Getty Images
Instead of hard, sharp corners in rectangular windows, Apple’s new design language has curved corners that match the device.
One reason Apple gave for rolling out the update now is that its computers and chips have become powerful enough to handle it. Apple said that its new look was directly inspired by the look of VisionOS, the company’s software for Vision Pro.
“Apple Silicon has become dramatically more powerful — enabling software, materials and experiences we once could only dream of,” Federighi said in a recorded video.
As with many Apple announcements, reactions are all over the map. Some people on social media were excited while others compared the update to the look of Windows Vista, which was released in 2007.
While Apple didn’t make many significant changes to the Siri experience, the company did introduce a few significant improvements and changes to its AI capabilities.
Apple also expanded its integration with OpenAI’s ChatGPT, integrating its image generation capabilities into an app that previously only used Apple’s technology.
When a user takes a screenshot on an iPhone, a new button will send the image to ChatGPT, which can summarize blocks of text in the image, or even decipher what’s happening.
One major improvement Apple is rolling out is in language translation.
During a phone call between two people who don’t speak the same language, the phone app can translate a sentence after it’s spoken and use an AI-generated voice to speak to the other party in the their language. Apple says the feature uses AI processed on the iPhone and doesn’t require a connection to a server.
New numbers
In some corners of the Apple fan universe, the most notable announcement on Monday may involve a simple number.
Since 2007, Apple had introduced a new version of its iOS every year. By 2024, Apple was on iOS 18. It’s a meaningful number for users who want to know if they have the latest Apple features, and some 82% of users with recent iPhones had upgraded to iOS 18 within a year.
Now, Apple is naming its operating systems for the iPhone and other devices after the year that they’ll be available for use by most consumers. In this case, it’s 2026.
In September, users will upgrade to iOS 26. Apple also has iPadOS 26, WatchOS 26, tvOS 26 and Vision OS 26.
The name change will simplify how to refer to the various operating systems, which had gotten confusing given that each device was on a different generation. It also keeps the pressure on Apple to keep rolling out an update every year, or else the number will make it clear that its software is outdated.
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