Tesla Finances vs. BYD Finances — Nonsense Myths Long Out Of Date

Last Updated on: 14th July 2025, 04:34 pm

BYD has been an electric vehicle leader for the past decade+. Tesla got much more attention for its leadership, and I think rightfully so, for several years, but BYD made more and more progress with its LFP battery cost cutting and vehicle development, and it then started to really shake up the market in China and grow faster. In recent years as it has grown faster and faster and Tesla has stalled or declined, I’ve seen Tesla fans (read: shareholders) try to wave away BYD’s progress and leadership in various ways. I think we’ve fully gotten to the end of the line with these claims, but many people still don’t realize it.

First of all, people said that BYD didn’t only sell EVs, so it wasn’t a fair comparison. That’s fine, I agreed. But then BYD stopped selling anything that wasn’t a plug-in vehicle, which was a notable step forward. Still, people critiqued the company noting that perhaps BYD sold more plug-in vehicles, but it didn’t sell as many full electrics (BEVs) as Tesla. That’s a fair, fine point. But the trends were telling us that argument wouldn’t last too long, and it didn’t. BYD started outselling Tesla in BEVs late last year, and it has left Tesla in the dust in that regard in 2025. That’s when we get to some financial arguments that have been circling around for years, and used to be true, but no longer are.

Tesla fans (i.e., shareholders) are keen to say that BYD loses money on its BEVs (it doesn’t), that it’s vehicle gross margin is much lower than Tesla’s (it’s not), and that Tesla makes much more in profits (it doesn’t). In response to some of these claims from a reader yesterday, one of our diligent BYD fact finders, Larry Evans, shared the following useful comment:

“BYD has higher revenue, gross margin and net profits as of recent quarters. And all major metrics are rising, while Tesla declines. (multiply by .14 to convert RMB to USD)

“Tesla would have lost money last quarter without regulatory credit sales. Those credits are essentially going away. With a P/E approaching 200 and declining metrics, TSLA is massively overvalued.

“TSLA’s one advantage is having banked billions in tax subsidies that they can carry forward for years, even though most new subsidies are now going away. Tesla has never paid US corporate income tax and, at current rates, will not pay anything through at least the end of the decade.”

No need for funny business or crunching numbers yourself — just look at Yahoo!Finance and compare the useful public information. I’ll do the currency exchange on a few of those numbers to show how they compare in USD (all numbers in thousands):

• Trailing three-month (TTM) gross profit: $22,311,910 for BYD vs. $16,907,000 for Tesla.
• 1st quarter of 2025 gross profit: $4,785,909 for BYD vs. $3,153,000 for Tesla.
• TTM net income common stockholders: $6,277,675 for BYD vs. $6,107,000 for Tesla.
• 1st quarter of 2025 net income common stockholders: $1,281,698 for BYD vs. $409,000 for Tesla.

Yes, the 1st quarter was a particularly bad quarter for Tesla, but so was the 2nd quarter and it wasn’t supposed to be. Also, the sales trends have clearly been positive for BYD and negative for Tesla. In any case, all of those claims about Tesla’s huge lead over BYD are just wrong.

Doing a little more googling, I find that BYD’s gross margin in Q1 2025 was 20.07% (down from 20.71% in Q1 2024), while Tesla’s was 16.3% (down from 17.4% in Q1 2024).