(Bloomberg) – Tesla Inc. and BYD Co. set new sales records in the second quarter and extended their lead as the world’s top-selling clean car makers.
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The Elon Musk-led Tesla delivered a record 466,140 cars worldwide in results released Sunday, beating Wall Street estimates. BYD, China’s top-selling auto brand, posted its best-ever quarterly result with 700,244 new-energy vehicles — half of all electric vehicles sold and the remainder plug-in hybrids.
Shares of BYD rose as much as 3.2% Monday morning in Hong Kong. Tesla battery suppliers Contemporary Amperex Technology Co. Ltd. and LG Energy Solutions Ltd. were up as much as 2.3% and 3.1% respectively on Monday before paring back gains.
Tesla’s results
Tesla’s results showed that CEO Musk’s promise to increase volume through price cuts was having its intended effect. Analysts polled by Bloomberg had expected the company to deliver 448,350 cars in the quarter.
“It’s a big blow,” Ben Kallo said of Robert W. Baird in a phone interview Sunday morning. “People were still preparing for another round of price cuts, and this large number of deliveries reduces the risk.”
Deliveries are the highest in a quarter for Austin-based Tesla and up 83% year over year. The company also managed to narrow the gap between production and deliveries closely watched by analysts to 13,560 units in the second quarter. In the first quarter, almost 18,000 more cars were produced than were delivered to customers.
“Everyone has been concerned about the inventory build and it looks like things have normalized,” Kallo said. “The delta between production and deliveries is shrinking, which Tesla has announced.”
Tesla, which sells its cars directly to consumers, has many levers to move vehicles. In addition to price cuts across its lineup earlier this year, the company rolled out perks, such as three months of free fast charging in the US for cars delivered before June 30, to lure buyers. Analysts expect the price cuts to continue into next year.
The story goes on
Read more: Tesla nears another delivery record after price cuts
Tesla doesn’t break down its quarterly delivery figures by individual vehicle type or region. The Model 3 and Y accounted for 96% of sales. Tesla also makes the Model S and X.
Tesla is still by far the largest EV maker in the US, but it’s facing new competition around the world. Its most recent vehicle – the Model Y – was launched in 2020.
In China — its second-largest market — the company has fallen well behind BYD, which has a much fresher lineup and increasingly global ambitions. Tesla announced last week that it was slashing the prices of its premium car models in China by more than 4.5% after deciding last month to offer cash subsidies to some buyers of its Model 3 vehicles.
Read more: Watch electric vehicle stocks in Asia after Tesla beats deliveries estimates
Tesla will report second-quarter results on July 19.
BYD record
A closely watched measurement of who leads the way in pure electric vehicle sales shows that Tesla has widened its lead over BYD, even as the Chinese manufacturer continues to grow globally through its affordable offerings.
Still, Shenzhen-based BYD’s quarterly sales — extrapolated from monthly data — rose 98% year over year. The increase marks a trend reversal after the weak first three months of the year. Its best quarter to date was the last three months of 2022, and the company sold a record 251,685 New Energy vehicles in June.
Smaller Chinese upstart Li Auto Inc. posted a new monthly high with 32,575 deliveries, while Xpeng Inc. and Nio Inc. posted modest gains. Guangzhou Automotive Group Co.’s electric vehicle brand Aion shone with another strong month of sales with 45,013 deliveries.
June sales “show that demand for new energy generation vehicles remains fairly strong,” despite the economic drag in China, said Joanna Chen, analyst for autos and electric vehicle batteries at Bloomberg Intelligence.
– With the support of Charlotte Yang.
(Adds stock price reaction in third paragraph)
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