BYD Dethrones Tesla: China Wins 2025 EV Sales Race as Tesla Slumps 9%

The global EV leaderboard just had a seismic shift. As of Saturday, January 3, 2026, Tesla is no longer the king of electric cars. China’s BYD has officially snatched the crown, and it wasn’t even close.

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The thing is, while Elon Musk was busy with politics and “cost-cutting” advice for the Trump administration, BYD was quietly flooding the world with 2.26 million battery-electric vehicles (BEVs). Or nothing. Let’s be real, trailing by 600,000 cars is a massive gap for a company that used to own this space. Those too.

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The “Delivery” Log: Field Notes

It’s an ongoing situation where the “old math” of car sales doesn’t seem to apply to Tesla’s stock price anymore.

• The Slump: Tesla delivered 1.64 million cars in 2025—a 9% drop. It’s their second annual decline in a row.

• The Q4 “Hangover”: After the $7,500 US tax credit expired in September 2025, sales fell off a cliff. Q4 deliveries dropped 16% to about 418,000.

• The BYD Flex: BYD didn’t just win; they accelerated. Their BEV sales grew 28% last year. If you count their hybrids, they sold 4.6 million cars. They’re effectively the new “People’s Car.”

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The “AI Pivot” Gamble

And here’s the kicker: Wall Street doesn’t seem to care that the car business is shrinking.

• The “Robotaxi” Mirage: Investors are valuing Tesla as an AI company now. Musk is betting the entire house on the Cybercab and “widespread robotaxis” by the end of 2026.

• The Regulatory Wall: While Musk promised “driverless” rides in Austin by now, safety supervisors are still sitting in the front seats. The goal for 2026 is to get NHTSA exemptions for cars with no steering wheels.

• The Trump Factor: The new administration has gutted the very EV incentives that built Tesla. Musk’s hope? That the “hollowing out” of regulations actually helps his autonomous dreams more than it hurts his car sales.

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What’s Next for 2026?

It’s an ongoing situation where the “Juniper” Model Y facelift is the only thing keeping the hardware side exciting.

• Model 2/Compact: Everyone is waiting for the sub-$30,000 Tesla to compete with BYD’s “Seagull” and “Dolphin,” but production isn’t expected to hit scale until 2027.

• Optimus V3: Musk says his humanoid robot will start “major shipments” this year.

Basically, Tesla is transitioning from a car company to a “Real-World AI” company. If the Robotaxi fleet doesn’t launch for real in 2026, the “AI” premium might finally start to leak.

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