BYD Poised to Overtake Tesla in 2025: EV Sales Surge as Tesla Faces Demand and Policy Headwinds

China’s rapidly expanding automaker BYD is poised to overtake Tesla in global electric vehicle sales in 2025. Strong hybrid and EV volumes, combined with Tesla’s slowing demand across major markets, are shifting the balance of power in the global EV industry.

Electric Car Sales: BYD Set to Become the World’s Largest EV Company in 2025, Ready to Overtake Tesla

BYD moves closer to global EV leadership

China’s fast-growing automobile manufacturer BYD is on the verge of becoming the world’s largest electric vehicle company in 2025.
Based on available data, it is almost certain that American EV giant Tesla will not be able to maintain its global lead this year.

BYD surges ahead in cumulative sales

BYD widens the gap with Tesla

By the end of November 2025, Shenzhen-based BYD had sold over 2.07 million electric vehicles.
The company also produces hybrid vehicles, which further strengthen its total sales figures.

Tesla, on the other hand, had sold only 1.22 million EVs by the end of September, clearly exposing the widening gap between the two companies.

Temporary boost for Tesla due to expiring tax credits

Tesla witnessed an unusual spike in sales by September, selling nearly 500,000 vehicles in just three months.
This surge was driven by customers rushing to buy EVs before the expiry of tax credits in the U.S.

These benefits were withdrawn under a law backed by President Donald Trump, who is often viewed as skeptical about climate change.

Tesla may slow further in Q4

Analyst projections for Tesla

According to estimates by data analytics firm FactSet, Tesla’s fourth-quarter sales may decline to 449,000 units.

If that happens, Tesla’s total sales in 2025 would stand at about 1.65 million units —
a 7.7% drop from last year, and significantly below BYD’s numbers as of November.

Deutsche Bank sounds a stronger warning

Pressure in key markets

Deutsche Bank presents an even more cautious outlook, predicting Tesla’s Q4 sales could shrink to 405,000 units.

The report suggests:

• Sales in North America and Europe may fall by nearly one-third,

• While sales in China could decline by about 10%.

Transition phase in the U.S. after tax credits

Auto industry analysts believe that after the $7,500 EV tax credit ends in September 2025, demand will take time to stabilize.

Tesla had previously faced challenges in several major markets — partly attributed to CEO Elon Musk’s political positioning and support for Trump and other right-wing leaders.

Double pressure: competition and political perception

Tesla faces strong rivalry from BYD and other Chinese companies, as well as European automakers.

Wedbush Securities analyst Dan Ives notes that deliveries may show weakness in the fourth quarter, although sales near 420,000 units would still signal steady demand.

BYD shifts focus to overseas expansion

Despite its rapid growth, BYD is also facing challenges in China, where cautious consumers and price sensitivity are pressuring profits.

This is why the company is aggressively strengthening its presence in overseas markets.

According to Fitch Ratings, BYD is among the first companies to establish foreign production capacity and supply chains, which could help it navigate global tariff environments more effectively.

Tariff disputes and BYD’s European strategy

Foreign competitors have already raised concerns about Chinese EV subsidies.

In the U.S., former President Joe Biden imposed 100% tariffs on imported Chinese EVs — measures that could become even stricter under Trump.

Europe has also imposed duties, but BYD chose to build a manufacturing unit in Hungary, helping it reduce tariff exposure.

A hope for Tesla: autonomous technology

Although reclaiming global leadership may not be easy, Tesla still has growth opportunities.

According to TD Cowen analyst LaMichaelie, Tesla’s Full Self-Driving (FSD) technology could play a pivotal role. As more features enabling driver-free operation roll out, vehicle demand may rise.

Future roadmap and new models

Elon Musk has stated that production of the autonomous robotaxi model “Cybercab” will begin in April 2026.

In addition, lower-priced versions of Model 3 and Model Y have already been introduced — offerings that could support Tesla’s sales in the years ahead.