Competition in the electric vehicle sector is only getting stiffer for Tesla in China, but what does that space exactly look like?
Here’s one stat that Stephen Dyer, an auto consultant at AlixPartners, told The Wall Street Journal: In 2023, about 123 auto companies sold an electric vehicle in China.
To put that into perspective, US News listed over 65 car brands in the US in 2023, some of which may have left the country when the list was published.
That’s a lot of companies trying to wedge their way into the EV market, and a large part of that is thanks to the Chinese government.
As Business Insider’s Linette Lopez noted in February, automakers received a huge lift from Beijing as it doled out government subsidies to any car company that would contribute to the country’s pivot to electric vehicles.
Lopez wrote that China began to slow down the subsidy pipeline in 2016, but that doesn’t mean support completely dissipated.
The Germany-based Kiel Institute for The World Economy published in an April report that BYD, China’s top EV automaker, received more than $2.2 billion in subsidies in 2022.
Massive government support only encouraged the uptick in EV production and a price war that Tesla has largely stayed out of — to the company’s detriment.
Still, Tesla remains one of the country’s top EV sellers, and only a few brands compete with the US-based automaker.
Dyer, the auto consultant from AlixPartners, told the Journal that only four EV makers sold more than 400,00 vehicles in China each in 2023: BYD, Aion, Wuling, and Tesla.
The latest quarterly earnings reports for 2024 show that Tesla remains the global leader in the EV space, selling about 387,000 vehicles, compared to BYD, which reported selling about 300,114 EVs.
The competition, however, comes amid a slowdown in EV sales that’s being felt in the US and China.
While US consumers continue to search for a cheaper EV alternative, China faces a more complex situation, BI’s George Glover noted, that factors in frustrating price wars and a broader faltering economy caused by deflation and a real-estate slump.
Tesla and BYD did not immediately respond to a request for comment.
