China-based electric car and battery manufacturer BYD (Build Your Dreams) is one of Tesla's fiercest competitors.
The company's stock has soared in recent weeks after its third-quarter profit doubled from last year. The company, whose cars went on sale in Turkey in September, surpassed Tesla on a quarterly production basis.
It comes right after Tesla in global sales.
BYD's success is also an indicator of the development of China's automobile industry; According to research, China surpassed Japan in exports this year. On the other hand, China's tense relations with the West lead to the shrinkage of the country's foreign market.
What is BYD's biggest advantage?
BYD's biggest advantage, unlike other companies, is that it started producing cars while it was a battery company, instead of producing batteries after making electric cars.
Wang Chuanfu, the company's CEO, who has a fortune of $18.7 billion, was born in one of China's poorest regions, but he founded BYD with his cousin in 1995 after studying engineering and physical chemistry.
In the following years, they became famous with rechargeable batteries used in smartphones, laptops and other electronic items.
Their biggest rival was the Japanese market, which sold their products at higher prices.
BYD acquired Qinchuan Automobile Company, which went through a difficult period after its public offering in 2002.
Although electric cars were still in development at that time, Chinese officials were looking for a gap in the market that they could fill.
In the early 2000s, the government started to provide subsidies and tax facilities as it gave importance to renewable energy production.
This was great timing for BYD; The batteries they produced could be used for electric cars.
Warren Buffett bought a 10 percent stake
In 2008, US investor Warren Buffett bought 10 percent of BYD's electric car manufacturing company.
Buffett explained the reason for this decision by saying that the company will one day be "the largest player in the global electric car market."
He was not wrong; Today, China dominates the global electric car market thanks to BYD.
Last June, the government signed off on a huge incentive by announcing a tax cut worth $72.3 billion for the next four years.
According to analysts, BYD's biggest advantage is battery production.
This is the most expensive part of electric vehicles; Tesla still buys its batteries from other manufacturers.
The price of BYD's entry-level electric vehicle Seagull is 11 thousand dollars. The starting price of Tesla's most recently announced Model 3 sedan in China is 36 thousand dollars.
It also surpassed Volkswagen
BYD's success seems to have gone beyond the electric vehicle market; It surpassed Germany's Volkswagen company as the best-selling car brand this year.
Elon Musk smiled when asked about BYD and its Chinese rivals in an interview in 2011; However, in September, the number of electric vehicles sold by Tesla in China fell to 74,043, indicating an 11 percent decrease compared to the previous year.
According to research, BYD sold 286,903 cars in the same period; This means a 43 percent increase in sales of electric vehicles and hybrid models.
Tesla created the demand for electric vehicles in China
However, there was no demand for electric vehicles until Tesla came to China. According to automobile analyst Ivan Lam, Tesla is still one of the most popular electric vehicle brands in China, and is even more popular among young people.
When China, the world's largest car market, decided to bring electric vehicles to the country, it relaxed the production and sales rules for foreign companies.
Previously, companies such as General Motors and Toyota had to find a local partner even if they wanted to establish a factory in China.
When this opportunity arose, Tesla immediately dived into the Chinese market. Today, Tesla is China's largest electric car exporter and the second largest electric vehicle sales company in China.
Chinese manufacturers are cheaper in Europe
Although Musk aims to increase production capacity in China, he is slowly shifting his target to India as tensions between the USA and China grow.
Cheaper Chinese-made electric vehicles are also popular in Europe.
European and British manufacturers are having difficulty competing with China.
The EU has launched an investigation into whether it should impose additional customs duties on imported, cheaper Chinese-made cars.
For now, BYD's cheap and green vehicles are very popular in Germany, which is trying to fight inflation and rising energy prices.
Germany, the headquarters of companies such as Mercedes-Benz, BMW and Volkswagen, is having difficulty coping with global electric vehicle production.
The topic that attracted the most attention at Europe's largest car fair, held last September in Mühih, Germany, was China's electric vehicles.
According to Bill Russo, founder of Automobility, an automobile investment company, purchasing power is a priority issue all over the world, and the only place in the world that can provide this in electric vehicles for now is China.