BYD share prices are up 44% this year, in sharp contrast to Tesla's 37% decline year-to-date.

As BYD rapidly expands globally, investors are worried that Tesla chief Elon Musk is stretched too thin with his new role in Trump's administration and multiple business ventures across SpaceX, Starlink, xAI, and X, formerly Twitter.

Investors are concerned that Elon Musk is becoming "stretched too thin" with his new role in Trump's administration and multiple business ventures across SpaceX, Starlink, xAI, and X, formerly Twitter. Most of his business ventures are also facing stiff competition in global markets.

After a strong start to the year, investors have largely pulled back from Tesla in 2024. This follows a period of rapid expansion by Chinese EV maker Build Your Dreams (BYD).

As BYD rapidly expands globally, investors are worried that Tesla chief Elon Musk is stretched too thin with his new role in Trump’s administration and multiple business ventures across SpaceX, Starlink, xAI, and X, formerly Twitter. Most of his business ventures are also facing stiff competition in global markets.

Tesla customers against Musk’s political actions are already boycotting the company and switching to BYD’s electric vehicles. BYD sales reached a record high of 4.3 million cars in 2024, whereas Tesla sales declined by 1% to 1.8 million.

Berkshire Hathaway chair Warren Buffett is an early investor in BYD. In 2008, he bought 225 million company shares for £177.39 million ($230 million), which turned out to be a massively profitable trade.

Although Buffett offloaded almost half of the holdings in the past two years as the stock price skyrocketed nearly 600% since the first trade, the Oracle of Omaha continues to hold a significant stake in the EV maker.

While Tesla's value has markedly dropped since December 2024, BYD shares recently reached a high after the company claimed to charge its EVs in as much time as it takes to fill a car with petrol.

'Tesla's Chinese rival BYD is surpassing its competitor with a new fast-charging technology,' says CMC Markets' Jochen Stanzl.

While only half of the market analysts covering Tesla stock have a ‘buy’ rating, 90% of the 30 analysts covering BYD maintain a ‘buy’ rating on the stock.

BYD is listed in Hong Kong but can be purchased in US and UK markets through certain brokerages. Investors can also explore investment funds that hold BYD, including the London-listed Baillie Gifford China Growth Trust.

However, Wedbush's Dan Ives, a renowned analyst, still maintains the view that Tesla will come out on top.

'BYD has gained market share versus Tesla, but over the long-term, Tesla will win the autonomous and robotics global market. Tesla has the scale and scope that is unmatched and there is only one Musk,' he noted.

Tesla share prices have faced immense selling pressure since mid-December 2024. This development has wiped out £600 billion ($777.91 billion) of company value and £120 billion ($155.58 billion) of Musk’s net worth.

In the past three months, hedge funds with short positions against Tesla have made an estimated £12.5 billion ($16.20 billion) in profits.

Tesla faces competition beyond BYD, including from companies like Xiaomi and China’s Li Auto. Most analysts covering Xiaomi and Li Auto have a ‘buy rating on the stocks.

Orgueil Capital's Stephen Roberts thinks BYD shares are much cheaper than Tesla's. 'The only way in which Tesla has the lead on them is probably fully autonomous driving,' he said.

'It's becoming increasingly evident that China is making substantial strides in disrupting established players in the EV market, including industry leaders like Tesla.'

UBS Joseph Spak's early March research note, predicting a 5% drop in Tesla's global sales in 2025, added to the selling pressure. The forecast, against 10% growth expectations, sent Tesla share prices down by 15% in one day.