(Bloomberg) — Tesla Inc. and BYD Co. Record sales in the second quarter, extending their lead as the world’s best-selling electric-car maker.
Most Read from Bloomberg
Elon Musk-led Tesla delivered 466,140 cars worldwide, beating Wall Street estimates. BYD, China’s best-selling car brand, posted its best quarterly sales results of 700,244 new-energy vehicles — half of which were all-electric sales, and the rest plug-in hybrids.
Shares of BYD rose as much as 3.2% in Hong Kong on Monday morning. Tesla battery suppliers Contemporary Amperex Technology Co. Ltd and LG Energy Solutions Ltd rose 2.3% and 3.1% respectively on Monday.
Tesla has promised to drive higher volumes even at the expense of profit margins. Analysts polled by Bloomberg had expected the company to ship 448,350 cars in the quarter.
“It’s a big beat,” Ben Gallo, Robert W. A Bird analyst said by phone Sunday. “People are still ready for another round of price cuts, and this big supply number makes that less of a risk.”
Austin-based Tesla’s deliveries were the highest ever in a quarter, and were up 83% from a year ago. The company produced 13,560 more vehicles than it delivered during the quarter. The launch surpassed sales of nearly 18,000 cars in the first quarter.
“Everybody was worried about building inventory, and it looks like they’ve become normal,” Gallo said. “The delta between production and distribution is shrinking, which is what Tesla said they would do.”
Tesla sells its cars directly to consumers and has a lot of levers to make the vehicles move. Along with slashing prices across the lineup this year, the company has introduced offers like three months of free fast charging in the US to lure buyers. Some analysts predict that the price cuts will continue into next year.
Read more: Tesla closes another delivery record after price cut
Tesla did not break down its quarterly delivery numbers by individual vehicle type or region. Models 3 and Y account for 96% of sales. Tesla also makes the Model S and X.
Tesla is still the largest EV maker in the U.S., but it faces stiff competition around the world from companies with new lineups. It launched a new vehicle – the Model Y – in 2020.
In China – Tesla’s no. 2 Market – The company lags far behind BYD, which has increasingly global ambitions. Tesla announced last week that it will cut prices of its premium car models in China by more than 4.5%, following its decision to offer cash subsidies to buyers of its Model 3 sedan.
Also Read: Watch Asia EV Shares After Top Ratings on Tesla Deliveries
Tesla will report second-quarter earnings on July 19.
BYD is holding on to Tesla’s all-electric vehicle sales, which more than doubled from a year ago to 352,163 units in the second quarter.
The Shenzhen-based company’s total sales were up 98% from a year ago. BYD’s previous best quarter was the last three months of 2022, and the company sold 251,685 new energy vehicles in June.
Small Chinese upstart Li Auto Inc. It recorded a new monthly high of 32,575 deliveries, while Xpeng Inc. and Nio Inc. have seen a moderate increase. Guangzhou Automotive Group Co. ’s EV brand Aion stood out with another strong month of sales with 45,013 deliveries.
June sales “show that new energy vehicle demand is very strong” despite China’s economic drag, said Jonah Chen, autos and EV batteries analyst at Bloomberg Intelligence.
–With help from Charlotte Yang.
(Third column adds stock price reaction)
Most read from Bloomberg Businessweek
©2023 Bloomberg LP