Both BYD and Tesla have established themselves as formidable players in the electric vehicle (EV) market. They have achieved remarkable profitability, outperforming their competitors. Moreover, both companies have experienced significant growth in EV deliveries, surpassing the overall market trends. In recent times, BYD has made great strides in enhancing its profitability, gradually narrowing the gap with Tesla.
BYD’s First-Half Performance
In its recently released first-half report, BYD (ticker: 1211.Hong Kong) showcased a commendable performance. The company’s car business generated sales of approximately $21 billion, accompanied by gross profits of $3 billion. Remarkably, BYD witnessed a year-over-year sales growth rate of 66%, while its gross profits witnessed a staggering growth rate of 75%. In terms of gross profit margins, BYD achieved 13.5%, a slight improvement from the 12.8% recorded in the same period in 2022. One contributing factor to this improvement is BYD’s expansion into a larger operating scale.
Notably, BYD delivered a total of 1.2 million passenger vehicles during the first half of the year, including approximately 642,000 battery-electric vehicles (BEVs). This represents an impressive increase of 95% and 92% in passenger vehicle and BEV deliveries, respectively, compared to the previous year.
Tesla’s First-Half Performance
Tesla (TSLA), a frontrunner in the EV industry, reported its first-half sales and gross profits at around $48 billion and $9 billion, respectively. While Tesla’s sales recorded a year-over-year growth rate of 35%, its gross profits experienced a slight decline of 7%. As for gross profit margins, Tesla achieved approximately 18.7%, surpassing BYD’s margins, but reflecting a decrease from the 27.2% achieved in the first half of 2022.
The decline in gross profit margins for Tesla can be attributed to the significant price cuts implemented at the beginning of the year. Although these price reductions impacted margins, they effectively stimulated sales volume. Tesla managed to sell nearly 890,000 BEVs in the first half of 2023, indicating a 57% increase compared to the approximately 565,000 BEVs sold in the corresponding period of 2022.
Impressive Growth and Profitability
It is worth noting the commendable growth and profitability exhibited by both BYD and Tesla, particularly when considering the prevailing conditions of the overall market. Their remarkable performance underscores their dominance in the EV sector and their ability to adapt to changing market dynamics.
In conclusion, both BYD and Tesla have emerged as successful EV manufacturers, showcasing considerable growth and profitability. While each company possesses its unique strengths and strategies, their parallel trajectory emphasizes their competitiveness within the market. With their unwavering commitment to innovation and sustainability, both BYD and Tesla are set to maintain their positions as leaders in the rapidly evolving EV industry.
Ford’s EV Sales Struggles Continue
Ford Motor (F) announced that it expects a staggering $4.5 billion loss from its electric vehicle (EV) sales in 2023. Despite delivering approximately 26,000 battery electric vehicles (BEVs) in the U.S. during the first half of the year, marking a 10% increase, the volume of sales is insufficient to achieve profitability. To put this into perspective, a typical automobile plant can manufacture anywhere from 300,000 to 500,000 units annually.
Robust Growth in China’s NEV Market
In terms of growth, the Chinese market for new energy vehicles (NEVs), which encompasses plug-in hybrids and BEVs, observed a remarkable 43% year-over-year increase in the first half of 2023, as reported by Citi analyst Jeff Chung. Meanwhile, BEV sales experienced a solid 30% year-over-year growth. It is worth noting that China currently stands as the largest market for new EVs, with sales figures of approximately 3.5 million NEVs and 2.5 million BEVs recorded in the first half of 2023.
Strong BEV Sales in the U.S. and Europe
BEV sales in the United States reached approximately 557,000 units in the first half of 2023, indicating a notable 47% surge compared to the previous year, according to Cox Automotive. In Europe, BEV sales totaled around 700,000 units, representing an impressive 53% increase according to data from the European Automobile Manufacturers’ Association.
Global BEV Sales Show Resilient Growth
On a global scale, BEV sales rose by approximately 33% in the first half of 2023. Notably, both BYD and Tesla surpassed this growth rate, with Tesla outperforming BYD in yet another metric – its stock price. Tesla’s stock has soared by 94% year-to-date, while BYD shares witnessed a more modest increase of about 17%.
Stock Performance
As of Monday morning trading, BYD’s U.S-listed American depositary receipts (BYDDY) experienced a 1.3% increase, while the S&P 500 and Nasdaq Composite both recorded gains of approximately 0.6%. Meanwhile, Tesla’s stock saw a more marginal increase of 0.2%.