Tesla China's Outstanding Performance in 2024

$Tesla (TSLA.US)$ 2024 performance paints a story of resilience and challenges, with record-breaking sales in China offsetting its first global delivery decline in over a decade. While global deliveries dipped slightly by 1.07% to 1.79 million vehicles, the Chinese market proved to be Tesla’s saving grace, contributing 37% of total deliveries and showcasing the EV maker’s adaptability in a fiercely competitive landscape.

Globally, Tesla faced headwinds, including reduced subsidies in Europe, a shift toward hybrid vehicles in the U.S., and intensified competition. These factors led to a 1.1% drop in worldwide deliveries, from 1.81 million in 2023 to 1.79 million in 2024. Even its Q4 global deliveries of 495,570 vehicles, while up 2.28% year-on-year, fell short of analysts’ expectations of 512,277. The missed target highlights the mounting challenges Tesla faces in maintaining its growth trajectory outside of China.

China, however, remains a bright spot not just for Tesla but for the global EV market. The country accounted for 70% of global EV and hybrid sales in 2024, driving over 90% of global EV growth. Tesla’s strategic pricing in the region, including 10,000-yuan discounts and zero-interest financing, helped it stay competitive despite the ongoing price war led by domestic automakers like $BYD COMPANY (01211.HK)$ .

Speaking of BYD, Tesla’s closest rival is catching up fast. BYD sold 1.76 million EVs globally, just shy of Tesla’s 1.79 million, and its total passenger vehicle sales surged 41% to 4.25 million. BYD’s cost-effective models and aggressive international expansion, with exports growing 71.9%, have made it a formidable competitor. Tesla’s response has included workforce reductions, a shift to online sales, and aggressive pricing strategies, particularly in China, to stay ahead in the game.