Who do you think is the world leader in EV sales? You almost inevitably think of Musk’s trail-blazing Tesla and its headline-grabbing, industry-worrying growth over the past ten years. But in actuality, they are currently being beaten by BYD. The Warren Buffett-backed Chinese firm sold 1.62 million EVs in 2022, while Tesla sold 15% less at 1.37 million. Yet Musk has far more to worry about than BYD outselling them. You see, BYD is just as profitable as Tesla, is proactively expanding outside of China, and their latest model is a 100 horsepower, 251-mile range, $14,000 EV that promises to revolutionise the EV market in ways Tesla’s upcoming Model 2 can only dream of. So how has BYD pulled this off? And should Musk be worried?
Firstly, let’s look at this new car. The BYD Seagull is a four-seater hatchback launched at the 2023 Shanghai Auto Show that is a similar size to a modern Fiat 500, with deliveries ready in only a few months time. While the name itself might be utterly terrible, the specs of this car are astonishing. It has two motor options: a 74- or 100-horsepower unit, both of which are front-wheel-drive. That might not sound like a lot, but because this car is tiny and light, there should be plenty of power for some spirited driving. There is also a choice of two battery sizes: a 30 kWh pack with a range of 190 miles CLTC or a larger 38 kWh pack with a range of 251 miles CLTC. Both packs use BYD’s incredible Blade Battery, but more on that soon. Similarly, both packs can rapid charge to 80% in only 30 minutes, putting them on par with many $40k+ EVs.
But the big headline here is the cost. The smaller 30 kWh pack variant costs the equivalent of $11,400, while the 38 kWh version is the equivalent of $14,000! This is insanely cheap and puts many upcoming affordable long-range EVs, like the Tesla Model 2 and VW ID.2, in serious trouble.
Before getting into these competitors, we must address how these ranges are displayed. As it happens, BYD is quoting their CLTC range, which is typical for the Chinese market but tends to be far more optimistic than the Western standards of WLTP or NEDC. For example, a Tesla Model 3 Performance has a CLTC range of 419 miles, whereas it has a WLTP rating of 339 miles, which is 19% shorter. If we apply this same ratio to the BYD Seagull, we find the smaller battery has a range of 153 miles, and the larger pack has a range of 203 miles.
But a $14,000 EV with 203 miles of range is still utterly revolutionary!
I mean, take the upcoming VW ID.2 and Tesla Model 2 (read more here). Both of these EVs are slightly bigger than the Seagull, are set to launch in 2025 for $25,000, and are being hailed as EVs that will take automotive electrification to the next level. The base ID.2 is expected to only have around 200 miles of WLTP range, and the Model 2 is touted as receiving 250 miles of WLTP range from a charge. Both of these cars will also charge to 80% in around 25 minutes.
With this in mind, why would you wait two years and spend an extra $11,000 on VW’s or Tesla’s offering? You wouldn’t. As such, the Seagull, despite its atrocious name, is set to completely dominate the affordable EV market and make life for Tesla and any other company hoping to produce affordable EVs very hard indeed.
So, how is BYD able to sell a car for so little? Are they losing money? Well, no. Let me explain.
Keep reading with a 7-day free trial
Subscribe to Planet Earth & Beyond to keep reading this post and get 7 days of free access to the full post archives.