BYD's Rapid Rise Has Tesla in A Spin

BYD, a Chinese-owned carmaker backed by Warren Buffett, has become a significant player in the global automotive industry, challenging longtime EV leader Tesla. Previously dismissed by Elon Musk, BYD has overtaken Tesla as the leading seller of EVs worldwide and is now introducing a new hybrid powertrain that can travel a staggering 1,300 miles, almost double that of competitors. BYD's shares in Hong Kong recently surged by over 5%.

Despite being America's best-selling EV brand, Tesla is losing market share internationally to competitors offering more affordable vehicles. Tesla has not introduced any major innovations recently that justify its higher prices. 

In contrast, BYD produces both EVs and hybrids, making it a formidable competitor on the global stage. In China, the largest auto market, BYD exceeded Volkswagen as the top seller last year.

BYD's sedans are notably cheap, with models featuring the new drivetrain starting at around $14,000, compared to the Toyota Prius, the best-selling hybrid in the US, which starts at $28,000. This affordability has helped BYD transform from a minor player into a global powerhouse, a shift that Musk once scoffed at.

Musk's tone has since changed. In a recent earnings call, Musk acknowledged that Chinese EV makers could outpace most other car companies without stronger trade barriers. BYD also has an advantage over Tesla with its hybrid models. While EV sales are hampered by insufficient charging infrastructure in the US, hybrids remain popular due to their lower costs and better fuel efficiency than traditional engines.