For years, the Tesla community has joked, "The competition is coming," because every EV talked about was suddenly the Tesla killer. Recent numbers show no competition for Tesla in North America; all the other manufacturers could pool their numbers together and still not come close to Tesla's sales.
The latest sales figures prompted Elon Musk to state once again, "The competition is coming." There's no denying that Musk's company has reshaped the automotive world's landscape, especially in North America, where its supremacy is almost undisputed. However, when we cast our eyes further East to China, a different story begins to unravel, and a formidable challenger, BYD, steps onto the stage. That casual comment is starting to sound increasingly prophetic.
Q3 Numbers Show BYD is Coming
The latest Q3 sales data reveals an intriguing trend. While Tesla delivered a commendable 435,059 pure electric cars, BYD was hot on its heels with sales of 431,603 pure electric passenger vehicles. This places BYD's EV sales at an impressive 99.21% of Tesla's for this quarter. To provide context, Tesla outsold BYD by more than 670,000 vehicles in the preceding six quarters. Now, the sales gap has narrowed dramatically to a mere 3,456 units.
Moreover, while Tesla's quarter-to-quarter growth experienced a dip of 6.7% (mainly due to factory shutdown for retooling and buyers awaiting the new Model 3), BYD's pure EV sales witnessed a significant surge, boasting a year-on-year growth of 66.9%. Current trends suggest BYD might even surpass Tesla in the upcoming Q4 sales.
Global EV Race Is Just Starting
Both companies manifest global ambitions, setting up vehicle factories in various parts of the world. Tesla's footprint extends worldwide, with an upcoming factory in Mexico. In contrast, BYD is bolstering its position with facilities in China and substantial investments in countries like Uzbekistan, Thailand, and Brazil. But, BYD is now looking at the North American market with a starting point in Mexico.
The global stage is set for fierce competition between these automotive giants. BYD's aggressive push into the Mexican market with its electric offerings, like the recently unveiled DOLPHIN, underlines its global ambitions. As the brand further cements its presence, with endeavors like expanding to 50 dealership stores across all 32 Mexican states, the groundwork for a North American entry seems to be laid.
Beyond just numbers, BYD's commitment to innovation is evident. The DOLPHIN, for instance, with its unique "Ocean Aesthetics design philosophy," its efficient fast-charging capability, and a range of 405 km, exemplifies the company's drive to merge aesthetics with performance. Additionally, their play isn't solely in the EV space; BYD's diverse technological background spanning over 28 years across different sectors sets them apart.
Competition is Good
Yet, framing this as a mere 'Tesla vs. BYD' scenario would be remiss. This growth and competition signify a more considerable momentum in the global shift towards sustainable transportation. As BYD expands its footprint, it reinforces the idea that the EV revolution is not a monopoly but a collective endeavor. However, for Tesla enthusiasts and market analysts alike, the movements of BYD, especially in China, are becoming impossible to ignore.
While Tesla has been enjoying its reign, BYD's recent strides remind us that the crown is up for grabs in the dynamic world of electric vehicles. Elon Musk's playful warning might have been more prescient than anyone realized: the competition is not just coming; it's already here.
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The greatly anticipated FSD v12.4 is around the corner, with Elon Musk mentioning that it will be going to employees this weekend, with limited external testers next week.
Several significant improvements are coming with V12.4, which is being compared to the leap in performance that was previously seen between V12 and V11.
Improved Comfort and Reduced Interventions
There are quite a few improvements expected with V12.4, which Musk has said will be focused on user comfort by reducing hard accelerations and sudden braking. According to Musk, FSD v12.4 is also expected to have a 5-10x improvement in time between user interventions, which means that Tesla is rapidly approaching its goal for the Robotaxi announcement on August 8, 2024.
Steering Wheel Nag Removal
FSD V12.4 is expected to eliminate the steering wheel nag, as Musk confirmed its removal last week. The camera-based driver monitoring system will be taking over, providing a hands-free experience. These improvements will most likely benefit owners who have cabin cameras with infrared lights the most, while Tesla may continue to use steering wheel nag as a fallback mechanism.
Driverless Autopark
The second key feature that may be included in v12.4 will be Banish Autopark, previously known as Reverse Summon, allowing you to choose a parking spot, exit the vehicle and have the car park itself. Whether this feature makes it in v12.4 is yet to be seen, but Musk has mentioned that parking without a driver is coming soon.
Automatically Seek Parking Spot at Destination
Finally, your Tesla will now traverse a parking lot and automatically enter Autopark mode when arriving at a destination, according to a post from Musk.
Eligibility and Branch
Tesla recently added FSD v12.3.6 to the 2024.14 branch with updates 2024.14.5 and 2024.14.6. This makes it very likely that Tesla’s next FSD version will also be based on 2024.14, meaning that it will be available to any vehicle on 2024.14.x.
For users on update 2024.3.25, this means that they’ll receive all of the features included in updates 2024.8 and 2024.14, which should make it a massive update.
Release Date
Musk has mentioned that FSD V12.4 is going out to employee vehicles for internal testing this weekend, with external testing starting next week. The rollouts typically go slower than predicted but looks like we may see this begin shipping to customers by the end of the month.
Today, as part of a broader change of tariff rates on Chinese goods, U.S. President Joe Biden announced that he’ll raise tariffs on electric vehicles imported from China, increasing the rate from 25% to 100%, effective this year.
This increase won’t just impact the import of vehicles, but also the rate for lithium-ion batteries produced in China, which will be moving from 7.5% to 25%.
Impact on Competition
The immediate impact of this new regulation is significant for Chinese manufacturers, who have been regarded as Tesla’s largest and greatest competition. Given the tariff hike, this means that new Chinese manufacturers, such as Nio, XPeng, or BYD, will either need to set up production in North America, or be subject to the increased import tariff.
Nio’s vehicles cost between $40,000 USD to $70,000 USD in China based on today’s conversion rates, and with an import tariff of 100%, an imported vehicle’s price would be doubled to $80,000 USD to $140,000 USD, not including other fees. Chinese manufacturers will have to closely weigh the advantages and disadvantages of opening up the North American market, with challenges including vehicle homologation, new tariffs, and a difficult EV market.
Tesla and Chinese Tariffs
Elon Musk recently visited China, engaging with officials to build a foundation for what is currently the world’s largest electric vehicle market. With the potential import of Chinese EVs becoming restricted to the United States, this places Tesla in an advantageous position over its Chinese competitors who have yet to establish their brands in North America.
On the other hand, this could also impact Tesla, as they import Chinese batteries for usage in some vehicles in the United States.
Tesla does not import Gigafactory Shanghai vehicles to the US, but has been increasing North American battery production lately, with expansions in Lathrop, California and a new facility in Sparks, Nevada.
Canadian Tariffs
In Canada, the Model 3 and Model Y are currently being imported from Gigafactory Shanghai. Given Canada’s close following of US foreign policy, this could impact either the prices of Tesla vehicles in Canada or have Tesla shipping vehicles from Fremont and Texas to the United States once again, should Canada also adopt a similar tariff policy.
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