Tesla posted record China sales in 2024. But this year is going to be tough as competition heats up
Tesla models Y and 3 are displayed at a Tesla dealership in Corte Madera, California, on Dec. 20, 2024.
Justin Sullivan | Getty Images
Electric vehicle-maker Tesla’s sales in China climbed to a record high last year. Sustaining that performance in 2025 could prove tricky as competition with homegrown players intensifies, analysts said.
The U.S. electric vehicle maker saw annual sales in China jump 8.8% to a record high of more than 657,000 cars in 2024. In December alone, its sales rose 12.8% from the previous month to 83,000 units, according to Tesla China.
However, Tesla has been losing market share to Chinese new-energy-vehicle players, down from 7.8% in 2023 to 6% in the January to November period last year, according to Bill Russo, founder and CEO of Automobility, who believes Tesla is “struggling to keep pace [with domestic rivals] and has a limited and aging product portfolio.”
Brand resiliency and price cuts have supported Tesla’s sales so far, said Tu Le, founder and managing director of Sino Auto Insights, but he was less certain that Tesla could keep up its momentum in 2025, given the lack of new products and increased local competition, especially from Chinese companies.
Aggressive price war
Tesla slashed the price for its best-selling Model Y in China by 10,000 yuan ($1,364.5) in late December and extended a zero-interest five-year loan plan for car buyers until the end of January.
Its best-selling Model Y now starts at 239,900 yuan after the discount, while the Model 3 sedan starts at 231,900 yuan — Tesla had cut its prices by 14,000 yuan in April — according to its website.
Still that marked a significant premium over a swath of cheaper models offered by Chinese domestic carmakers. BYD, which dominated the market with around 34% market share, prices one of its best-selling models Seagull at 136,800 yuan, and the more affordable Yuan Plus model, starting at 96,800 yuan.
TOPSHOT – People look at a BYD Seagull car by Chinese electric vehicle (EV) manufacturer BYD Auto at the Bangkok International Motor Show in Nonthaburi on March 27, 2024. (Photo by Lillian SUWANRUMPHA / AFP) (Photo by LILLIAN SUWANRUMPHA/AFP via Getty Images)
Lillian Suwanrumpha | Afp | Getty Images
As the price war extends into the new year, Li Auto introduced cash subsidies of 15,000 yuan per purchase along with a three-year zero-interest financing scheme, according to a post last Thursday on its social media Weibo account. Nio also extended a similar three-year zero-interest loan plan for its EV buyers.
The purchasing incentives came on top of Chinese authorities’ push to extend the consumer goods trade-in program, which subsidizes consumers to trade in old cars or appliances and buy new ones at a discount.
The government-subsidized trade-in program could further lower prices for both Model 3 and Model Y by up to 50,000 yuan, Tesla China said.
“Tesla has to discount aggressively to keep pace with the ongoing price war in the market,” Russo noted.
Despite dwindling market share, Tesla is unlikely to lose its ground completely in China, according to Joe McCabe, CEO and president of AutoForecast Solutions, who compared Tesla as “the Apple of cars” — an “early adopter” in the EV space with “phenomenal” technology.
“I don’t think Tesla is at risk of not surviving,” McCabe added, “all [Elon Musk] has to do is drop the price by 5%, because he can, and that will help for little blips.”
Head-to-head race
In addition to lowering prices, Chinese electric carmakers have rolled out a slew of new models, many with fancy in-car features, such as projectors, embedded refrigerators and driver-assist systems.
Meanwhile Tesla has been slow in adopting any of these features, with its product portfolio focused solely on fully electric vehicles, while its homegrown rivals have steered into plug-in hybrid cars and extended-range EV categories.
These more traditional models appeal to buyers who are “still worried about the leap to fully electric [cars],” Sam Fiorani, vice president of AutoForecast Solutions said. “Tesla has no plans for anything other than fully electric vehicles.”
The automaker’s plans of launching its full self-driving supervised system still hinges on regulatory permission in China, while several local competitors have made the advanced driver-assistance systems a basic part of their offering, including BYD.
Musk had warned in January that Chinese automakers could “demolish most other car companies in the world” unless regulators intervene with trade barriers, as the Warren Buffet-backed BYD overtook Tesla as the world’s top-selling EV company in the last quarter of 2023.
The U.S. imposed a 100% duty on Chinese EVs last September to protect its homegrown industries from the pricing pressure posed by heavily-subsidized peers from China. The European Union has also moved to impose tariffs as high as 45.3% on Chinese EV cars imported late last year, while Tesla enjoyed a lower tariff rate of 7.8%.
The trade barriers would force Chinese automakers to find buyers at home and in the “smaller, friendlier” foreign markets, adding pressure on Tesla’s sales in China and elsewhere, Fiorani added.
Tesla’s sales of China-made EV cars including exports to foreign markets fell modestly by 0.4% from a year ago to 93,766 units in December, according to CNBC’s calculation of China Passenger Car Association data.
BYD, which is subject to 17% tariff duties for car exports to European Union, still led the rank with 509,440 cars sold in December, a near 50% year-on-year jump.
—CNBC’s Evelyn Cheng and Sonia Heng contributed to this report.
Elon Musk has finally confirmed that Tesla’s new ‘affordable’ electric car is just going to be the Model Y in a cheaper format.
Musk has ended months of speculations and misinformation, which he partly created, about Tesla’s upcoming cheaper electric vehicle model.
Since last year, Tesla has guided “launching new affordable models” in the first half of 2025.
We are past the first half of 2025, but Tesla confirmed yesterday that the “first build” of the new model was produced in June, and it will launch later this year.
During the shareholders’ call following the earnings results yesterday, Tesla was asked about what the new affordable model would look like. Tesla’s CFO, Vaibhav Taneja, initially stated that they wouldn’t disclose details about the design, but then Musk interrupted him and said, “It’s a Model Y.”
It’s hard to hear exactly on the call because he talked over Taneja, but he said, “the cat is out of the bag” and confirmed that the new vehicle is simply a Model Y.
Electrek has been reporting on this fact all year. We have known for months that Tesla’s upcoming “new affordable models” are Model 3 and Model Y with a stripped-down interior with fewer features, like no rear screen, and cheaper materials:
However, this fact was not accepted in the Tesla community because CEO Elon Musk falsely denied a report last year about Tesla’s “$25,000” EV model being canceled.
The facts are that Musk canceled two cheaper vehicles that Tesla was working on, commonly referred as “the $25,000 Tesla” in early 2024. Those vehicles were codenamed NV91 and NV92, and they were based on the new vehicle platform that Tesla is now reserving for the Cybercab.
Instead, Musk noticed that Tesla’s Model 3 and Model Y production lines were starting to be underutilized as the Company faced demand issues. Therefore, Tesla canceled the vehicle programs based on the new platform and decided to build new vehicles on Model 3/Y platform using the same production lines.
Now, only the new Cybercab is going to be based on the new unboxed platform.
During the conference call last night, Musk stated that the primary goal of the more affordable Model Y is to expand the market by making the vehicle more accessible to a broader audience. He suggested that it will go on sale in Q4.
Electrek’s Take
Finally, we can put this to rest. I think we can expect something similar to what Tesla did with the Model 3 in Mexico.
I think we can expect changes, such as using cloth materials instead of vegan leather, no rear display, no ambient lighting, and a lesser audio system.
In the case of the Model Y, Tesla may consider dropping some exterior lighting features, such as the light bars.
I wouldn’t be surprised also to see some powertrain changes. Maybe a less powerful RWD motor.
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MIT spinout Electrified Thermal Solutions has inked a deal with HWI, a member of Calderys and one of the biggest refractory suppliers in the US, to make electrically conductive firebricks – electric bricks, or E-bricks – that store and deliver extreme heat using renewable electricity.
The innovative partnership is all about scaling up Electrified Thermal’s Joule Hive Thermal Battery, which conducts clean power and stores it as heat up to a scorching 1,800C (3,275F). That’s hot enough to drive even the most energy-hungry industrial processes like steelmaking, glass, or cement production.
The E-bricks enable factories to ditch fossil fuels and run on renewables without sacrificing performance or reliability, and at a lower cost.
The MIT-developed tech is getting paired with HWI’s 160-year track record in high-heat materials. The E-bricks will be built in HWI’s existing US plants, which means the system can scale fast using current supply chains instead of building new factories from scratch.
Electrified Thermal expects its first commercial-scale Joule Hive system to come online this year. By 2030, the Boston-based startup wants to deploy 2 gigawatts’ worth of thermal power across industry.
“Industrial heat represents one of the most challenging frontiers in the world’s effort to address climate change,” said Daniel Stack, Electrified Thermal’s CEO and co-founder. “The majority of energy used for it worldwide still comes from burning fossil fuels. Our partnership with HWI transforms what could have been a manufacturing bottleneck into a powerful scaling advantage.”
HWI says Electrified Thermal’s E-brick is a breakthrough. “It maintains the high-temperature durability required by customers, while also generating the heat to run their processes,” said Ben Stanton, director of applications technology at HWI.
Calderys’ global VP of innovation, Bruno Touzo, added that the company is ready to help expand E-brick production across its global network. “It enables us to respond effectively to the growing demand from industries transitioning to cleaner energy solutions,” he said.
Read more: 91% of renewables are cheaper than fossil fuels, but Trump just defunded a vital US grid upgrade
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The Chinese EV maker calls it a “high-energy super SUV.” BYD launched the Sealion 06 EV on Wednesday, a new entry-level electric SUV. It starts at just over $20,000, but BYD promises that the new Sealion 06 EV won’t feel like a base model, with advanced tech and safety features, fast charging, and a driving range of over 375 miles.
BYD launches the new Sealion 06 EV
The new midsize SUV was launched at a conference in China on Thursday in fully electric (EV) and plug-in hybrid (PHEV) powertrain options.
BYD stopped making gas-powered vehicles in 2022 and now offers EV or PHEV options across most of its lineup.
The all-electric BYD Sealion 06 EV is available in three trims, with prices ranging from 139,800 yuan ($21,000) to 163,800 yuan ($23,000). It comes in single and dual-motor variants with two BYD Blade battery pack options: 65.28 kWh and 78.72 kWh.
The single-motor features either a 227 hp (170 kW) or 241 hp (180 kW) at the rear. With the standard (65.28 kWh) battery, the RWD variant offers a CLTC driving range of 520 km (323 miles). Upgrading to the long-range (78.72 kWh) battery provides a CLTC range of 605 km (376 miles).
The AWD variant utilizes a 241 hp (180 kW) rear motor, paired with an additional 147 hp (110 kW) motor on the front, for a combined 388 hp (290 kW). It’s also available with a range of up to 520 km (323 miles).
BYD’s new electric SUV measures 4,810 mm in length, 1,920 mm in width, and 1,675 mm in height, which is slightly larger than the Tesla Model Y.
The interior is based on an advanced version of BYD’s DiLink 100 smart cockpit, which includes a 15.6″ floating infotainment screen and a 26″ Head-up (HUD) display.
It also comes with features you won’t typically find on entry-level models, like a built-in refrigerator that can cool and heat.
Like most new BYD vehicles, it’s equipped with its God’s Eye C Intelligent Assisted Driving. The system utilizes five radars, 12 high-definition cameras, and 12 ultrasonic radars to offer over 30 safety features, including assisted driving on highways and remote parking.
Source: CarNewsChina, BYD
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