Taking a Battering
“Taking a Battering” – a cartoon that illustrates how BYD (Build Your Dreams), a Chinese car company, is eating Tesla’s lunch.
In the last quarter, Tesla reported a 71% plunge in profits and a 20% slide in vehicle sales.
On the company’s earnings call, Elon Musk pledged to cut his White House DOGE duties to “a day or two a week” so he can refocus on the car business.
Meanwhile, in the last quarter, BYD delivered over 1M vehicles, doubled its profit to $1.3BN, and grew exports by 111%, cementing its lead over Tesla in global EV sales.
Wang Chuanfu, founder and CEO of BYD, remarked, “BYD has mastered the core technologies of the whole industrial chain of new energy vehicles, such as batteries, motors, and electronic controls.”
The challenge for Tesla is that its decline stems from aging products, shrinking margins, rising global competition, and a slowdown in mainstream EV demand, not just Elon Musk’s personal brand controversies.
For example, the company has not meaningfully refreshed its top-selling Model 3 or Model Y for years and with its focus on slashing prices, revenue per vehicle has dropped, leading to operating margins falling from from 20% (2022) to under 10% (Q1’25).
While many Tesla stock holders cheered the new wave of tariffs on Chinese EVs like BYD, in the long term, they expose its dependence on U.S. policy shields (aka Donald Trump’s negotiating tactics) rather than competitive innovation.
Sources:
Peter Lyon (Apr 26, 2025) – Tesla Seems Doomed If Musk Stays, And Sunk If He Leaves – Forbes
Tom Carter (Mar 14, 2025) – Tesla sales are slumping in the US, too – Business Insider
Jay Ramey (Mar 12, 2025) – Are Tesla’s Fortunes Headed for a Historic Plunge? – Autoweek
