The global electric vehicle (EV) market is witnessing a dramatic shift as Chinese brands BYD and Xiaomi surpass Tesla in consumer preference, according to a new UBS survey.
The study shows Chinese buyers now favor domestic EV makers due to strong product offerings, cutting-edge technology, and competitive pricing—challenging Tesla’s long-held dominance.
Tesla’s Popularity Slipping Globally and in China
In China, Tesla’s appeal has sharply declined. Just 14% of respondents in the UBS survey named Tesla as their top EV choice—down from 18% last year and 30% in 2020.
Globally, Tesla’s top-brand recognition dropped from 22% to 18%, with the U.S. and European markets also seeing notable declines.
Tesla now ranks behind Audi and BMW in Europe, with only 15% of consumers favoring the brand. In the U.S., Tesla’s share fell to 29% from 38%, hurt by a limited vehicle lineup and persistent affordability concerns. In China, Tesla is losing its image as a tech leader, especially as local competitors offer more advanced features at lower prices.
Xiaomi’s Stunning EV Debut
Xiaomi’s entry into the EV sector has been nothing short of sensational. Its first car, the SU7 sedan, outsold Tesla’s Model 3 in China in April, moving 26,223 units.
The company’s upcoming YU7 SUV directly targets Tesla’s Model Y, offering competitive features like city-level assisted driving and a large infotainment display at an attractive price point.
BYD Expands Lead Domestically and Abroad
BYD remains a dominant force in the Chinese EV market and is expanding globally. In April, it outsold Tesla in Europe for the first time, marking a major milestone. While Tesla’s China sales dropped 60% from March to April (to 28,731 units), BYD’s momentum continues to grow.
Local EV Brands Out-Innovate Tesla
The UBS report highlights how Chinese brands are not just competing on price—they’re winning on innovation. Xpeng’s new sedan, for example, features advanced smart driving tech at half the price of a Model 3.
Xiaomi offers city-level Navigate on Autopilot (NOA) in vehicles priced around $27,500, undercutting Tesla’s expensive Full Self-Driving (FSD) system.
Tesla at a Crossroads
From January to April 2025, Tesla sold 163,338 vehicles in China—a slight 0.3% dip year-on-year. BYD sold 886,240 units, up 12.9%, while Xiaomi surged with 104,454 units—an explosive 1379.9% increase. As local brands redefine expectations, Tesla must innovate or risk further decline in this rapidly evolving market.