Elon Musk recently expressed his respect for a competitor, BYD, despite previously mocking the quality of their vehicles in a 2011 video. The Tesla CEO responded to a Bloomberg interview where he had laughed at BYD, considering it non-competitive. However, circumstances have changed, and Musk now acknowledges BYD’s progress in the industry.
In April, BYD reported a significant surge in profits of over 400% compared to the previous year’s first quarter. They also announced a nearly doubled global vehicle sales figure of 550,000 in the same quarter. As a result, BYD has become the top-selling brand among automakers in China, overtaking Volkswagen. Their success extends beyond China, as they have entered markets in Europe, Latin America, and Asia, posing a significant challenge to Tesla’s dominance in the Chinese market.
Musk acknowledged the video clip from 2011 but emphasized that it was a long time ago. He recognized that BYD’s cars are now highly competitive, showcasing a change in his perspective. Others in the industry also share this sentiment. Volkswagen CEO Oliver Blume praised BYD’s strength during a recent event in Shanghai. Ford CEO Jim Farley mentioned BYD as one of Ford’s main electric vehicle rivals, highlighting the Chinese companies’ growing influence in the industry.
Berkshire Hathaway vice chairman Charlie Munger, who played a key role in the company’s investment decision in BYD back in 2008, spoke highly of the Chinese automaker. He stated that BYD outperforms Tesla in China and praised the investment as one of the best decisions made by Berkshire Hathaway. Interestingly, in the same year of Munger’s investment, Musk had a lunch meeting with him, suggesting that Berkshire Hathaway should invest in Tesla. However, Munger declined the offer, and Berkshire Hathaway has generally avoided investing in automakers over the years.
According to Bloomberg, in the first quarter of this year, BYD commanded nearly 40% of the market share among new energy vehicle makers in China, while Tesla lagged behind with just over 10%, a distant second. Tesla initiated a price war against BYD in China to improve its position.
In the extended version of the 2011 Bloomberg interview, Musk further expressed his skepticism about BYD’s products, stating that he didn’t consider them great or particularly attractive. He also pointed out the company’s severe issues in their home market of China. Despite Musk’s previous criticisms, BYD has clearly thrived and overcome the challenges, solidifying its position in the industry.
In conclusion, Elon Musk’s recent acknowledgment of BYD’s competitiveness signifies the remarkable progress made by the Chinese automaker. BYD’s impressive financial performance, market share, and global expansion have garnered recognition from industry leaders. While Musk had previously dismissed BYD, he now recognizes their success and the need for Tesla to consider them a formidable competitor.