Byd vs. Tesla – Some important points

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In a comment thread for our article “Byd Shocks – is winning the EV Revolution,” Larry Evans added a very interesting and useful perspective. Some argue that Tesla has a very high gross profit, while BYD has a very low margin, due to how things stood a few years ago. A lot has changed since 2019, or 2021, or even 2023. But there’s more to this than a simple note about the total margin. Larry writes:

“BYD’s gross automobile margin for the most recent reporting (quarterly) was 25.6%. Tesla’s gross automobile margin, excluding the regulatory units, was 13.58% in the most recent reporting quarter.

“BYD was a battery and electronics company that started manufacturing cars. Starting as a supplier, they were much more vertically integrated by nature and did not “copy Tesla.”

“BYD also started small and is constantly profitable. In particular, in R&D, we have reinvested almost everything we’ve acquired to grow our business. Tesla has given us money for most of its existence. We raised a large amount of capital to promote a business that we lost. When we ultimately made a profit, it tended to sit on more cash rather than spending it to grow the business.

“Nearly two-thirds of the global EV market are China. Almost three-quarters are China and rows (the rest of the world). BYD is China’s biggest player, including Singapore, Philippines, Colombia, Israel, Thailand and Brazil It has taken over the queue as the largest EV brand in…

“And they overtake Tesla in the UK in January, and it won’t take “decades” in the market that allows them to compete. ”

Good point, rally! A good point.

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