Tesla’s Only Challenger

By Douglas A. McIntyre Published Aug 29, 9:30AM EDT

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Chinese automaker BYD sold 700,244 vehicles in the second quarter. Tesla Inc. (NASDAQ: TSLA | TSLA Price Prediction) delivered 466,140 for the same period. Granted, BYD is not a global company. By the same token, China is the world’s largest car market by far. (These are the 13 biggest electric vehicle business failures in American history.)
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Tesla and BYD each have a problem. The U.S.-based company sold 64,285 cars in China in July. That is a jump of 128% but still puts it well behind BYD in the market. Also, Tesla’s sales dropped 31% from June.
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BYD, on the other hand, sells almost no cars outside China. It may not for some time. The company says it has no plans to enter the United States. That leaves the world’s second-largest car market to Tesla and new competitors, which include Ford.

BYD can afford expansion, either in China or overseas. Its profits in the first half were $1.5 billion. Its growth is almost guaranteed. “BYD is targeting mass market where Tesla cannot reach,” said Vivek Vaidya, associate partner at Frost & Sullivan, on CNBC’s “Street Signs Asia.”
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One wildcard for Tesla and other Western car makers is whether rising tension with the Chinese government will lead to restrictions on sales. China has done as much to other industries before.
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Wall Street still assumes that Tesla will be, by far, the largest EV company in the world. Its market cap is $760 billion. Shares are up 93% this year.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.