Tesla brutally hit, China drops EV bombshell
Tesla has had the week from hell and it just got a whole lot worse after Chinese EV company BYD dropped a bombshell update.
On the Road
Don't miss out on the headlines from On the Road. Followed categories will be added to My News.
After seeing a Cybertruck explode outside a Trump hotel, this week has just got even worse for Elon Musk.
Shares in his company Tesla have plummeted more than 6 per cent after its closest rival reported record annual sales just shy of the American car giant’s.
Leading Chinese electric car maker BYD’s vehicle sales surged in 2024, the company said in a statement, as the firm grows its overseas presence.
The EV and battery giant is the most prominent of Chinese automotive firms expanding abroad — plans that are increasingly threatened by bitter trade disputes between Beijing and the West.
The company’s quarterly revenue surpassed global rival Tesla’s for the first time during the third quarter last year — and that was not the only bad news for Elon Musk’s company.
Tesla reported a dip in full-year sales overnight, missing a company forecast in a sign of rising electric vehicle competition in China and other markets.
The EV company reported 495,570 fourth-quarter deliveries. While that represented a quarterly record, it lagged Wall Street estimates and resulted in full year-sales of just under 1.8 million vehicles.
This was around one per cent less than the 2023 sales, even as Tesla said in October that it expected a “slight growth” in vehicle deliveries for the year.
Besides rising competition from producers like China’s BYD and legacy car companies, analysts pointed to a sluggish ramp-up of production of the futuristic Cybertruck.
Shares of Tesla fell sharply following the news, cutting into the company’s massive gains since the November 5 US presidential election.
The sales figure caps a mixed 2024 for Tesla, a year in which Mr Musk dived full-on into US electoral politics.
He helped to deliver the presidency to Republican Donald Trump through massive contributions and messaging on his platform, X.
But Tesla’s profits through the first three quarters of 2024 fell 31 per cent from the equivalent period of 2023, a reflection of moves to slash prices in the wake of slowing demand.
Tesla has called the current period of moderating sales reflective of its position “between two major growth waves,” with the next period of volume increases due to advances in autonomy and the introduction of new vehicle products.
The company has faced pressure to roll out new vehicles, with Wall Street particularly eager to see a lower-priced model. The Model 3 currently starts at around $54,900 in Australia.
Investors warmed to a statement from Mr Musk in July that he plans a new, more affordable model in the first half of 2025, but the company has provided few details.
CFRA Research analyst Garrett Nelson pointed to tepid deliveries of the Cybertruck, which customers first began receiving in November 2023.
Tesla’s press release on Thursday did not break out sales for the vehicle, which were a component of “other models.” Deliveries in this category stood at just 85,133 for the year.
Mr Musk has previously described the Cybertruck’s challenges as production-related, characterising demand as robust. He has said he expects annual sales of 250,000 Cybertrucks in North America.
But today’s output appears to be well below Cybertruck’s current installed capacity of above 125,000 per year, according to Tesla.
“The ramp up has been disappointing,” said Mr Nelson, adding that the figures raise questions about demand for the vehicle.
Though still not common on US roads and nowhere to be seen in Australia, the massive, brutal-looking Cybertruck has become perhaps Tesla’s most emblematic vehicle, generating both adoration from Tesla fans and mockery on social media from critics.
The massive vehicle made headlines around the world on Wednesday when one exploded at the Trump Las Vegas hotel.
The suspected bomber Matthew Livelsberger shot himself in the head just before the explosion, police said.
Metropolitan Police Department Sheriff Kevin McMahill told reporters on Thursday that Mr Livelsberger, 37, was found inside the vehicle with a “self-inflicted gunshot wound” to the head. Authorities are still investigating the blast.
BYD on the rise
Meanwhile Chinese electric car maker BYD’s vehicle sales surged in 2024.
BYD sold 4,272,145 vehicles last year, up 41.3 per cent from 2023’s 3,024,417 units, the company said Wednesday.
In December alone, BYD sold 57,154 vehicles outside of China — a 58.3 per cent jump from the same period in 2023. But BYD still sold almost 90 per cent of its cars in its home market in December 2024.
The majority of the company’s 2024 sales were for plug-in hybrid models — 58 per cent of total units sold.
BYD — which adopts the English slogan “Build Your Dreams” — is the biggest EV manufacturer in China, the world’s largest automotive market.
The initial rapid sales growth of BYD and its industry peers in their home market was facilitated in part by generous subsidies from Beijing.
The European Union has said that extensive state support has led to unfair competition, with an investigation by the bloc finding that Beijing’s subsidies were undercutting local competitors.
The EU announced in October that it would levy extra tariffs of up to 35.3 per cent on Chinese EVs, prompting Beijing to say it would “take all necessary measures” to protect firms’ interests.
Earlier in 2024, the United States and Canada raised customs duties on Chinese EVs to 100 per cent.
BYD’s figures come after global EV sales hit a record 1.8 million units in November, according to industry research company Rho Motion.
“This quarter has picked up significantly for EV sales globally as we see record-breaking month after record-breaking month,” Rho Motion expert Charles Lester said in a press release last month.
“However, the regional picture is somewhat uneven with Europe shrinking three per cent this year so far and once more China accounts for over two thirds of the electric vehicles sold in November.”
Autonomous push
Despite the gloomy trading on Thursday shares of Tesla rose more than 60 per cent between the November 5 election of Mr Trump as president and the end of 2024, with the market certain that Mr Musk’s clout with the incoming administration will benefit Tesla initiatives in autonomous driving and artificial intelligence.
“The next step in this broader Tesla strategic vision begins is the autonomous and AI era which will be accelerated under a Trump White House,” said analysts at Wedbush, which called Tesla’s 2024 auto sales a secondary issue compared with Tesla’s growth story.
Tesla sceptics point to the on-the-ground progress of Alphabet-owned Waymo, which currently runs robotaxis in three US cities.
A heavily-touted October launch event in Los Angeles showing off Tesla’s autonomous robotaxi vehicles received mostly lacklustre reviews.
But Tesla bulls point to the company’s progress in driver-assistance technologies, which is providing the company with data that it believes will ultimately lead to full autonomy.
“We still have a buy on the stock,” said Mr Nelson, who also foresees a rebound in sales next year. “2025 is going to be a year where there’s significant progress in developing the framework on autonomous driving. So that’s a positive for the stock.”
Shares of Tesla sank 6.9 per cent in early-afternoon trading
More Coverage
Originally published as Tesla brutally hit, China drops EV bombshell
Push for more truckies to use EVs
Tens of millions of dollars have been pledged to subsidise electric vehicle loans in a major push to get businesses using greener transport options.
Four dead after horror crash with stolen car
Four people have died after an allegedly stolen car was seen driving dangerously moments before it crashed into another vehicle.