29.7%
3.2%
14%
55.9%
The Great Market Reversal
Tesla fell to 14 percent as a top EV brand choice, down from 18 percent last year, and now behind both BYD and Xiaomi, according to UBS analyst Joseph Spak's team in a research note. This represents a fundamental shift in consumer sentiment within the world's largest automotive market.
"In China, we see intense competition and Tesla is no longer seen as the technology leader," the UBS note revealed. This assessment reflects the rapid advancement of Chinese EV manufacturers who have closed the technology gap while maintaining significant price advantages.
BYD: The Undisputed Market Leader
Innovation Focus: BYD continued to be No. 1 in April with a 29.7 percent share, which was up from March's 29.3 percent, demonstrating consistent growth despite intensifying competition.
BYD's strategy extends beyond simple market leadership. BYD has triggered another EV price war in China by slashing the price of several models, with discounts reaching up to 34%. This aggressive pricing demonstrates the company's confidence in its profitability and manufacturing efficiency.
Xiaomi's Meteoric Rise
Xiaomi's entry into the automotive sector has been nothing short of spectacular. The SU7 Ultra received over 6,900 orders within 10 minutes of opening for ordering and reached its annual sales target of 10,000 units in 2 hours, showcasing unprecedented consumer enthusiasm for the brand.
This is the fifth consecutive month that the SU7 has seen monthly deliveries exceed 20,000 units, bringing cumulative deliveries to over 180,000 units by February 2025.
The SU7 Ultra delivers 1,548 horsepower and can accelerate from 0-100 km/h in just 1.98 seconds, positioning it as the fastest four-door production car globally.
The starting sales price announced at launch was 285,000 yuan (39,000 USD) lower at 529,900 yuan (72,800 USD) than the presale price, representing a 35% reduction.
Xiaomi EV is targeting deliveries of 300,000 units for the whole of 2025, more than doubling their 2024 performance of 135,000 deliveries.
Tesla's Declining Fortune
Tesla's challenges in China extend beyond simple market share decline. Tesla's retail sales in China were 28,731 units in April, down 8.6 percent from 31,421 in the same month last year. More concerning for the American EV maker is the dramatic positional shift from ranking 3rd in March to 8th place in April.
Challenge Focus: China represents Tesla's second-largest market after the United States, making these losses particularly significant for global performance.
Market Dynamics and Price Wars
The domestic market penetration rate for new EV cars exceeded 50% for seven consecutive months starting in June 2024, with The EV penetration reached 55.9%, a new high this year in May 2025. This demonstrates the rapid adoption of electric vehicles in China.
97% of surveyed Chinese consumers consider EV their next car purchase, indicating complete market transformation from internal combustion engines.
By September 2024, China boasted an impressive 11.433 million charging stations nationwide, representing a substantial 49.6% year-on-year increase.
Chinese EV brands are expanding internationally, with BYD outselling Tesla in key European markets including Germany and the UK in April 2025.
Annual domestic EV retail sales reached a remarkable 11 million units in 2024, establishing China as the undisputed leader in EV adoption.
Global Market Implications
The success of Chinese EV manufacturers in their home market has profound implications for global automotive competition. Automobile marketshare for battery electric vehicles (BEV) in China reached 27% in 2024, compared to 13% in the EU and 8% in the US, demonstrating the advanced state of Chinese EV adoption.
The Chinese market demonstrates that success in EVs requires more than just technological capability. Price competitiveness, rapid innovation cycles, and deep understanding of local consumer preferences have proven decisive factors. European manufacturers face the challenge of competing against brands that have mastered these elements on their home turf.
