BYD Shares Fall on Discounts, But Outpaces Tesla in Europe

Shares of BYD dropped sharply this week after the Chinese EV giant announced sweeping price cuts across 22 models, triggering fresh worries about a price war in China’s already competitive electric vehicle market. 

BYD’s stock slid 4% in Tuesday’s Hong Kong session, extending Monday’s losses. Yet, despite the volatility, BYD remains over 50% up year-to-date, far outperforming Tesla, which is down 13% in 2025.

The discounts, ranging from 10% to 34%, include a €6,460 slash on the Seal 07 DM-i. While this strategy risks pressuring margins, it may pay off in volume. Analysts from Citi expect a 30% to 40% surge in weekly sales, potentially clearing the 150,000-unit inventory overhang and resetting the pace for newer models.

Other Chinese EV makers weren’t spared either. Xpeng, Great Wall Motor, and Geely all fell between 4% and 9%, showing just how sensitive the sector is to pricing signals. Still, BYD is in a stronger position than most. In April alone, it sold over 380,000 EVs, a 21% increase year-on-year, and set new overseas sales records for the fifth month running.

What Does This Mean for Me?

In a significant milestone, BYD outsold Tesla in Europe for the first time, registering 7,231 battery-electric vehicles, a 169% jump. Meanwhile, Tesla’s European sales have contracted in 2025, weighed down by CEO Elon Musk’s political visibility. In Q1, BYD’s net income hit €1.11 billion with a 20% gross margin, easily outpacing Tesla’s €359 million and 16% margin.