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Tesla (TSLA) and BYD Co. (BYDDF) are both fast-growing EV giants. While a lot of attention falls on startups such as Rivian Automotive (RIVN), Lucid (LCID), Nio (NIO), Xpeng (XPEV) and Li Auto (LI), as well as traditional automakers pushing into EVs, such as General Motors (GM) and Ford Motor (F), Tesla and BYD are setting the pace.
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Both recently reported record deliveries and have huge expansion plans. Tesla Berlin and now Tesla Austin are starting deliveries. BYD is opening multiple plants this year, launching several new models and expanding into new export markets.
Tesla earnings surged 246% in the first quarter vs. a year earlier, the company reported April 20. BYD reported 241% earnings growth in Q1 on April 27.
But while they are the two largest EV makers, their models haven’t competed much head-to-head. That’s about to change.
Tesla Shanghai Shutdown
The Shanghai plant was shut down due to Covid restrictions from March 28 to about April 19. Since then, a limited number of staff living on site has resumed some output v via limited staff living on site. Tesla had aimed for full production by May 16, but the Shanghai plant all but shut down again on May 9 as a supplier had to stop shipments due to a Covid infection from one of its employees. It’s unclear what the current state of Tesla Shanghai production is.
The city of Shanghai is expected to begin easing restrictions on physical stores starting May 16 as Covid cases continue to fall.
Meanwhile, industry data showed Tesla Shanghai production plunged in April, with very limited deliveries. With woes continuing well into May, Tesla’s global production and deliveries will likely fall substantially in the second quarter, even with the Berlin and Austin plants slowly ramping up.
BYD, meanwhile, reported a slight increase in April sales, topping 100,000 for a second straight month and quadrupling vs. a year earlier. The EV giant largely avoided production hiccups, helped by its in-house battery and chip operations.
Barring major production shutdowns, BYD appears set to easily seize Tesla’s EV crown in Q2. However, BYD reportedly has suspended production at its Changsha plant amid environmental concerns in the central Hunan province.
Tesla stock and BYD stock were winners in 2021. Tesla recently set fresh 2022 lows. BYD stock is down solidly for the year, but holding above key levels and showing renewed relative strength.
Which is a better bet now? Let’s take a look at Tesla vs. BYD — and Tesla stock vs. BYD stock.
Tesla Vs. BYD Sales
Tesla, the world’s largest electric-vehicle maker, on April 2 reported Q1 worldwide deliveries of 310,048. That just topped Q4’s record of 308,600, but was up sharply from 241,300 in Q3, 201,250 in Q2 and 184,800 in Q1 2021.
Q1 deliveries included 295,324 Model 3 and Model Y vehicles, down slightly vs. Q4. Tesla also delivered 14,218 Model S and X vehicles, up modestly vs. Q4.
Meanwhile, Tesla Shanghai production in April plunged to 10,757 vehicles, according to industry data released May 10. Tesla delivered just 1,512 vehicles, a sliver vs. 65,814 in March. There were no exports last month. Production and deliveries will be well below normal in May as well.
Tesla has exported roughly 9,000 vehicles from Shanghai so far in May, with at least one of those ships heading to Europe.
On May 3, BYD reported it sold 106,042 new energy vehicles (NEV) in April, a new record and up 1% from March’s 104,878. Sales surged 313% from a year earlier.
That’s in sharp contrast to almost all automakers in China. On May 1, Nio, Xpeng and Li Auto reported big delivery declines vs March.
Passenger vehicles totaled 105,475. Of those, BYD sold 57,403 all-EVs, up 256% vs. a year earlier. Plug-in hybrid sales skyrocketed 439% to 48,072 units in April.
BYD’s PHEV sales have skyrocketed thanks to a new DM-i system that provides substantial battery range.
In Q1, BYD sold 286,329 EV and hybrid vehicles. That was nearly equal to Tesla’s all-electric deliveries.
BYD had a decent chance of passing Tesla sales in the second quarter, even before the Shanghai plant shutdown. BYD is highly likely to maintain its lead in Q3 and beyond, given its slew of new models, factories and markets.
It’s possible that BYD’s EV-only sales will top Tesla sales by year-end.
BYD’s sales are far above those of Nio, Li Auto and Xpeng, let alone U.S. EV startups Lucid and Rivian Automotive.
BYD halted production of traditional gas-burning vehicles at the end of March. Those sales had been winding down considerably.
Tesla Vs. BYD Expansion
Tesla recently began Model Y deliveries from its plants near Berlin, Germany, and Austin, Texas. They’ll likely ramp up production and deliveries slowly over time.
Ongoing capacity increases to the Tesla Shanghai facility also will boost production. Tesla plans to build a second Shanghai plant, Reuters reported on May 3, citing a Tesla letter to local officials. It’s unclear when Tesla would start work on the second China site.
Analysts had expected Tesla to deliver 1.5 million EVs in 2022, though the Shanghai shutdown will likely reduce sales by more than 50,000.
BYD also is adding significant EV capacity, along with a number of new or expanded battery plants.
The auto giant has signaled that it will conservatively sell 1.5 million new energy vehicles in 2022, or up to 2 million if supply issues ease. That’s up from 2021’s NEV sales of 593,745.
Tesla, targeting the luxury and affordable luxury markets, has far higher selling prices than BYD. Tesla has raised prices several times in the past year.
Tesla, BYD and several other automakers have raised prices recently due to soaring raw-material costs. With EV and overall auto production still constrained, automakers’ pricing power remains robust.
BYD also has the benefit of lower-cost China production, but its ASPs are much lower, with the majority of its EVs and hybrids selling for $15,000-$34,000, though some vehicles top $40,000. The China EV giant does plan to move upscale. It reportedly will unveil a high-end brand this year, starting with a large crossover SUV.
BYD has increased its stake in its Danza joint venture with Daimler to 90% from 50%. Danza, which is not a big auto operation, could be another avenue for BYD to move upscale.
BYD Vs. Tesla: Tesla Electric Vehicles
Tesla produces four electric vehicles: the luxury Model S sedan and Model X SUV as well as the Model 3 sedan and Model Y crossover. The vast majority are the Model 3 and Model Y.
Tesla has long touted the Roadster, Semi and Cybertruck as future vehicles. But those have been pushed back multiple times. Musk says he hopes Cybertruck production will begin in 2023.
That suggests Tesla will go three years — or more — before launching a new vehicle following the Model Y in spring 2020. Also, the Cybertruck likely will largely serve the U.S. market. So Tesla may not have a new vehicle for most of the world until 2024 or later.
Musk said on the Q1 earnings call on April that he hopes to have a robotaxi model with no steering wheel or pedals in production by 2024, but that timelines seems unlikely for a host of reasons.
Musk also said Tesla is not currently developing a $25,000 vehicle, a goal he had touted for years. That would be key to reaching much of the global auto market. Even now, such a model would run into dozens of existing rivals, mostly from Chinese EV makers such as BYD.
The Cybertruck, Semi and Roadster vehicles may require big improvements in batteries or battery technology to be viable.
Tesla is struggling with technical issues for mass-producing the 4680 battery. Some Austin-made Model Ys have 4680 battery packs from a pilot line, but cost savings are likely elusive.
BYD Vs. Tesla: BYD EVs Big And Small
BYD has a slew of models, some with electric and hybrid versions such as the flagship BYD Han sedan. The automaker is rolling out several new EV-only and hybrid-only models in the next several months, along with notable revamps or longer ranges for key models.
BYD began China sales of the Yuan Plus in February, with a subsidized price starting below $21,000. The Yuan Plus EV has a range of 267 miles-317 miles under a very loose China standard. The compact SUV is BYD’s second Ocean line EV using its e-platform 3.0, following the smaller Dolphin. The Yuan Plus also is kicking off an expansion into new export markets, notably Australia.
BYD sold just over 10,000 Yuan Plus EVs in March. Meanwhile, the new Destroyer sedan from the new “warship” PHEV line began deliveries in late March.
BYD on April 10 officially launched more-advanced hybrid versions of its BYD Han, with an electric-only range of up to 150 miles on a China standard. The all-electric Han also got a substantial upgrade, including a big increase in battery range. BYD said on April 10 that it received more than 48,000 orders for the updated Han EV and hybrid models since preorders began on March 19.
But perhaps the most-important upcoming model for BYD is the Seal sedan. It marks BYD’s first clear head-to-head competition vs. Tesla. The BYD Seal will be a Model 3 rival, but with longer range, faster acceleration — and $10,000 cheaper. BYD has been steadily feeding new images and information about the Seal in recent weeks. BYD reportedly will begin Seal pre-orders on May 20, with actual deliveries presumably starting by July. And unlike many Tesla rivals, when BYD launches a new model, it quickly produces in volume.
BYD’s 90%-owned Denza joint venture will launch the high-end Denza D9 minivan on May 16, with an all-electric and hybrid version. Mercedes-Benz owns 10% of Denza.
BYD also is one of the biggest makers of electric buses, with plants in the U.S. and many other countries besides China. In late January, BYD unveiled a new, smaller school bus for the U.S. market with bus-to-grid charging abilities.
BYD has gotten a slew of bus orders in Europe, where diesel buses are being phased out. That could serve as a steppingstone for BYD’s personal EV ambitions on the Continent.
BYD also makes EV delivery trucks, big rigs, garbage trucks and more. Anheuser Busch recently added an additional 20 BYD electric trucks to its California fleet. BYD signed a deal to deliver 200 Class 8 electric trucks in the U.S. for Sweden’s Einride.
BYD makes buses, big rigs and other heavy vehicles for the U.S. market at its Lancaster, Calif., plant. Also at Lancaster, BYD will assemble the next generation of Nuro self-driving delivery vehicles, using many BYD parts, including Blade batteries.
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Tesla Stock Vs. BYD Stock: EV Markets
Tesla is a truly global EV giant, with major sales in North America, Europe and China. It has notable business in Korea and some other Asian markets. It has four plants, starting with Fremont, Calif., and Shanghai, joined by the Austin, Texas, and Berlin-area plants getting started. Tesla already exports to Europe, mostly from the Shanghai plant.
As the Berlin plant ramps up, the Shanghai plant presumably will export far fewer Model Ys to Europe, though Model 3 shipments will likely continue.
While Tesla capacity is set to soar, it has no major new markets to enter or any new vehicles in the near future.
New U.S. EV credits would provide another Tesla demand boost at home. But that hasn’t happened yet, and there is a growing risk that Congress will not approve them at all.
BYD’s auto plants are in China, with virtually all its sales there. BYD easily tops Tesla in local China sales, even just in EVs.
That means BYD has a lot of markets to expand into. In late 2021 it began selling the Tang SUV in Norway, giving it a foothold for a much-larger expansion across Europe.
It is shipping various EVs and hybrids to Latin America, launching its BYD Han in Brazil.
BYD will begin selling the Yuan Plus in Australia, branded as the Atto 3 for the local market, in July or. BYD’s Dolphin and Seal will later enter the Australian market, perhaps with the Atto 2 and Atto 4 names, BYD’s importer says.
BYD’s low to moderately priced vehicles could serve rich and developing nations, while Tesla’s current and planned vehicles are clearly aimed at affluent customers in rich nations.
America isn’t in BYD’s sights for now. Tariffs on China-made autos make exports to the U.S. cost prohibitive. BYD does make some EV buses here, with a lot of extra space at its Lancaster, Calif., site outside Los Angeles.
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Tesla Vs. BYD Batteries
Tesla doesn’t make battery cells, at least not in mass production. The Sparks, Nevada, gigafactory is a joint venture with Panasonic. Panasonic makes the battery cells and Tesla packs them together. In China and increasingly in the U.S., Tesla buys off-the-shelf batteries from CATL. It’s increasingly shifting to lithium iron phosphate batteries. LFPs have some cost advantages, which have grown because they don’t require any cobalt or nickel, unlike lithium-ion batteries.
Tesla has long led in getting more out of its batteries, though the high-end Lucid Air has higher battery efficiency than Tesla.
Tesla is developing its own 4680 battery cells in a pilot program. The 4680 batteries don’t involve new battery chemistry. The larger form factor offers the potential for cost savings, but there are technical challenges.
BYD batteries, by contrast, are truly in house. The BYD Blade batteries, a specialized LFP battery, have good range and are seen as among the safest available for EVs.
BYD sells its batteries to other automakers, which could be a growing business in 2022 and beyond.
The made-in-China Ford Mustang Mach-E, just starting deliveries, uses BYD batteries. GM will use BYD batteries in a made-in-China Cadillac. Toyota (TM) is expected to use BYD Blade batteries in an upcoming small EV for the Chinese market. There is widespread speculation that BYD will be actively involved in Toyota’s wider EV push in the coming years, including but possibly not limited to batteries.
Nio will work with BYD on the former’s upcoming sub-brand that will target the mass market, according to local media reports. A deal would likely involve BYD Blade batteries. Chinese handset giant Xiaomi reportedly will use BYD Blade batteries as it prepares to enter the EV market.
Finally, there are persistent rumors that BYD will supply Blade batteries to Tesla, which may want to less its reliance on EV battery leader CATL. But there has been no confirmation.
BYD also has begun licensing its DM-i hybrid system to other automakers.
BYD and Tesla are on the forefront of automakers trying to lock up supplies of lithium and other key battery raw materials. BYD is involved in lithium mining projects.
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Tesla Beyond EVs
Tesla and BYD are more than just EV makers.
Tesla has solar and battery storage businesses, but both are just a small part of total revenue.
Tesla also generates revenue via its Supercharger network. It’s starting to open its Supercharger network to non-Tesla vehicles in parts of Europe, where third-party charging stations are common. In the U.S., the Supercharger network is still a big moat for Tesla.
One of Tesla’s most important and most controversial products relates to its self-driving efforts, notably Autopilot and Full Self-Driving. FSD has been a key revenue driver and brand builder. If Tesla is able to create a cheap, vision-only system that is fully autonomous everywhere and anywhere, the payoff will be enormous. But for now, even FSD Beta is a Level 2 driver-assist system.
There are downsides. Regulators could step in, forcing major changes and restricting or barring Tesla’s driver-assist systems. The National Highway Traffic Safety Administration is stepping up oversight vs. the EV giant. The NHTSA is conducting a probe of Autopilot crashes into stationary emergency vehicles.
If Tesla is unable to move past Level 2, while rivals such as GM’s Cruise, Ford-related Argo, Google’s Waymo and many China operators roll out Level 4 robotaxi services in city after city, its brand and stock could take a hit. Bullish analyst price targets for TSLA stock often assume huge self-driving revenue in the coming years, along with massive EV market share.
On the Q1 earnings call, Musk said Tesla is putting a lot of effort on developing the Tesla Bot, or Optimus. But there is no prototype, and most experts say generalized humanoid robots are decades away.
BYD Semiconductor, Solar And More
In addition to making its own batteries, BYD makes its own chips, which has helped the company rapidly expand over the past year as the global industry sees production losses. In late January, the automaker won approval to list its BYD Semiconductor spinoff on the Shenzhen ChiNext market. The company also has solar and energy storage businesses.
BYD has a number of partnerships related to autonomous driving. BYD in March said it will adopt Nvidia’s Drive system for autonomous driving. The follows a self-driving partnership with Baidu (BIDU), a leader in autonomous-driving technology. Nvidia (NVDA) and Baidu have long been autonomous-driving partners.
In April, BYD said it will use chips from local Horizon Robotics in some 2023 models.
That follows a driver-assist joint venture with Momenta, a Chinese autonomous-driving startup. On Dec. 23, BYD signed a strategic deal with Lidar supplier RoboSense, taking a stake.
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Tesla Stock Vs. BYD Fundamentals
Tesla earnings more than tripled to $6.78 a share in 2021, vs. $2.24 a share in 2020 and just 3 cents in 2019.
Tesla earnings shot up 246% in Q1 and revenue rose 81%, both accelerating for a second straight quarter.
BYD earnings declined in 2021, while net profit margin fell. Capital spending in 2021 exceeded capex from 2018-20 combined, with huge outlays for new auto, battery and chip plants. EV and PHEV production capacity has surged in recent months and continues to increase as more factories come on line. That will spur massive revenue gains this year and beyond, driving future profits. BYD capex also goes for new models and battery technology.
BYD reported first-quarter net income jumped 241% in local currency terms vs. a year earlier. That was in line with a recent forecast for 174%-300% growth. Revenue rose 63% in local currency terms.
Tesla Stock Vs. BYD Stock Technicals
Tesla stock rallied 49.8% in 2021 vs. 28.7% for BYD stock, according to MarketSmith analysis.
Tesla stock is down 27.2% as of May 13 in a volatile 2022. BYD stock is off 10.85%, considering better than in mid-March.
Tesla has a price-to-earnings ratio of 87, still high. BYD’s P-E is in the triple digits. High P-E stocks generally have struggled as interest rates rise.
TSLA stock hit a record high in early November after breaking out of a long consolidation in October. Shares had wide-and-loose action since then.
On April 5, TSLA stock reached 1,152.87 intraday, right around a trendline entry. Shares reversed solidly lower and have trended down since then. Tesla stock technically still has a cup-with-handle base with a 1,152.97 buy point. But the chart is flawed.
Shares surged intraday on April 21 following earnings but slashed gains as the broader market reversed lower.
Shares have been volatile since then but most lower, plunging decisively through their 50-day and 200-day lines. On May 12, TSLA stock plunged to 680 intraday, undercutting the Feb. 24 intraday low of 700. Shares rebounded from there, but still fell hard for the week.
BYD stock also broke out in October to record highs but tumbled back, hitting a nine-month low on March 14.
BYD stock rebounded back above its 50-day and 10-week lines. Shares have largely held those levels for several weeks. BYD stock traded tightly before a big upside reversal in the week ended May 13.
The EV giant’s relative strength line is at its best levels in five months.
Arguably, shares are forming a mini-consolidation from the early April high of 31.55 within a much-larger consolidation. But getting above that level would leave BYD just below its 200-day line. Ideally, BYD would rally above its 200-day and beyond, then form a handle within the consolidation going back to November.
Tesla Stock Market Cap
In terms of market cap, Tesla stock vs. BYD stock is no contest. Tesla has an $797.3 billion market valuation. That’s leagues above BYD’s $82.7 billion.
BYD’s market cap is more than that of Rivian stock ($24 billion) and Lucid stock ($29.8 billion) combined. It’s also comfortably above the market valuations of GM stock ($55.5 billion) and Ford stock ($54.3 billion). BYD has a higher market cap than Xpeng, Nio and Li Auto stock combined.
An S&P 500 giant, Tesla stock has an array of institutional sponsorship, including many IBD-style mutual funds and other A+ funds. TSLA stock remains the No. 1 holding across ARK Invest’s ETFs.
Tesla also is on IBD Leaderboard.
BYD stock has far-less big sponsorship, though Warren Buffett’s Berkshire Hathaway (BRKB) has been a notable investor for years. Cathie Wood’s Ark Invest also owns a small stake. Very few stocks can boast both Buffett and Wood as investors.
BYD stock is listed in Hong Kong and only trades over the counter in the U.S. That also means BYDDF stock shows a lot of minigaps, with most of the share price action reflecting Hong Kong trading.
Tesla Stock Vs. BYD Stock
In many ways BYD is what Tesla claims or aspires to be. BYD does make its own batteries and chips. It’s selling its batteries and licensing related technology to other automakers. Musk has long touted a goal of a $25,000 Tesla. BYD already sells many EVs at or below $25,000, and at a profit.
In the here and now, Tesla sells more far more pure electrics than BYD, and at much-higher price points. Tesla earnings are booming, while BYD earnings have recently declined.
BYD has many big markets in which to expand, including several this year, though it’s unclear when it might try to tackle the U.S. EV market.
Both EV giants are delivering far more vehicles than rivals such as Xpeng and especially the likes of Lucid and Rivian.
Growth prospects are still strong for these EV leaders.
Tesla stock and BYD stock were among the biggest EV winners in 2021. TSLA stock and BYD stock are down in 2022, but many other EV and traditional automakers are down far more.
So, Tesla stock vs. BYD stock? Both are EV leaders with booming sales growth and strong prospects. Both stocks performed well in 2021.
Tesla stock has broken key support and needs a lot of repair. BYD stock has held up better in recent weeks. Neither is close to a buy point. But investors should keep their eyes on both.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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