Large BYD Recall Could Help Tesla
Chinese automaker BYD just issued big recalls of two of its most popular models. Is this a chance for Tesla to gain some market share in China?
24/7 Wall St. Insights
- Chinese automaker BYD just issued big recalls of two of its most popular models.
- Is this a chance for Tesla Inc. (NASDAQ: TSLA | TSLA Price Prediction) to gain some market share in China?
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China’s electric vehicle (EV) market share leader BYD has just recalled 97,000 of its vehicles. Parts of the steering control in these can cause fires. BYD is Tesla Inc.’s (NASDAQ: TSLA) primary rival in China, where the American company struggles with local competition.
According to Reuters, “The Chinese automaker is recalling Dolphin and Yuan Plus EVs manufactured in China between November 2022 and December 2023, according to a statement from the State Administration for Market Regulation.” The two models are among BYD’s most popular in terms of unit sales.
Tesla needs to take sales from BYD to increase its market share. However, BYD’s share in China is over 25%, while Tesla’s share is about 6%.
In August, Tesla had its best sales month of 2024. The U.S. car company sold about 63,000 units, up 37% from July. However, it continues to struggle to gain any ground on BYD.
Tesla needs BYD to make one or more unforced errors that could hamper the pace of its sales success. A huge BYD recall could fall into that category.
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