^{Photo: South China Morning Post}

China’s electric vehicle leader BYD is facing mounting pressure at home, with passenger EV sales declining for the eighth consecutive month as competition intensifies across the world’s largest auto market. While the company continues to expand aggressively overseas, its domestic dominance is increasingly being tested by fast-growing rivals and shifting consumer dynamics.

In April, BYD delivered 314,100 new energy passenger vehicles, including both battery electric and plug-in hybrid models. This represents a 15.7% drop compared to the same month last year, although sales did edge up 6.2% from March, suggesting some short-term stabilization. Despite the monthly improvement, the year-on-year decline highlights the growing challenges in maintaining momentum in a crowded market.

Domestic Slowdown Meets Rising Competition

The Chinese EV landscape has become significantly more competitive, with several automakers posting record-breaking numbers. Companies like Leapmotor and Zeekr are rapidly gaining ground, fueled by aggressive pricing, new model launches, and strong consumer demand.

Leapmotor delivered 71,387 vehicles in April, marking a 73.9% surge compared to a year earlier and setting a new monthly record. The company, backed by global automotive giant Stellantis, has been expanding its footprint both domestically and internationally, building on its first full-year profit achieved in 2025.

Meanwhile, Zeekr, Geely’s premium EV brand, recorded 31,787 deliveries, representing an impressive 131.6% year-on-year increase. The brand continues to position itself in the higher-end EV segment, appealing to consumers seeking advanced technology and premium features.

Tech-driven entrant Xiaomi is also emerging as a serious contender. The company reported over 30,000 EV deliveries in April, alongside more than 70,000 pre-orders for its upgraded SU7 sedan. Its rapid rise underscores how technology firms are reshaping the competitive landscape.

Other players are maintaining steady growth. Nio delivered 29,356 vehicles, up 22.8% year-on-year, supported by its expanding lineup that includes more affordable sub-brands. Li Auto posted 34,085 deliveries, holding relatively flat with a marginal 0.4% increase.

Xpeng, however, joined BYD in reporting a year-on-year decline, with deliveries falling 11.5% to 31,011 units, despite launching its new GX SUV mid-month.

Profit Pressures Add to Challenges

Beyond sales volumes, BYD is also grappling with profitability concerns. The company reported a sharp 55.4% drop in first-quarter profit compared to the previous year, as revenue declined 11.8% to 150 billion yuan, or roughly $22 billion.

The earnings pressure reflects a combination of factors, including pricing competition, rising input costs, and increased investment in innovation and global expansion. As competitors scale up and introduce more affordable options, margins across the industry are tightening.

Exports Emerge as a Key Growth Driver

While domestic performance has weakened, BYD’s international business is providing a crucial offset. The company recorded a historic high in exports, shipping 135,098 vehicles overseas in April alone. This represents an increase of more than 70% compared to the same period last year.

The strong export growth highlights BYD’s strategic pivot toward global markets, where demand for affordable EVs continues to rise. The company has set an ambitious target of exporting over one million vehicles annually by 2026.

BYD has already established a dominant presence in several emerging markets. In 2025, it accounted for approximately 70% of EV sales in Mexico and 75% in Argentina, demonstrating its ability to capture market share in regions with growing demand for electric mobility.

In Europe, the company is also making significant inroads. Registrations of BYD passenger EVs across the European Union, the European Free Trade Association, and the United Kingdom surged more than 155% year-on-year in the first quarter of 2026.

Global Expansion and Strategic Moves

To strengthen its global footprint, BYD has invested heavily in overseas manufacturing and partnerships. The company has established production facilities in Brazil and Hungary, aiming to localize production and reduce supply chain risks.

It is also seeking deeper integration into the European automotive ecosystem, including efforts to join key industry bodies. However, its international expansion has not been without challenges, as some overseas operations have faced scrutiny over labor practices.

Other Chinese EV makers are following a similar path. Leapmotor is expanding internationally through its joint venture with Stellantis, targeting hundreds of sales and service outlets across Europe and Latin America. The company aims to export between 100,000 and 150,000 vehicles annually in the near term.

Li Auto is also accelerating its global ambitions, recently announcing plans to enter Middle Eastern markets such as Saudi Arabia and the United Arab Emirates, while exploring opportunities in Southeast Asia.

Shifting Industry Dynamics

The broader EV market in China is entering a new phase, characterized by intense price competition, rapid innovation, and an influx of new entrants from both automotive and technology sectors. As a result, even established leaders like BYD are facing increased pressure to defend market share while sustaining profitability.

The divergence between BYD’s domestic slowdown and international growth underscores a key transition in its business model. While China remains its largest market, future growth is increasingly tied to its ability to scale globally and compete in diverse regulatory and consumer environments.

Bottom Line

BYD’s latest performance reflects the evolving realities of the global EV industry. While the company remains a dominant force, declining domestic sales and rising competition are reshaping its growth trajectory. At the same time, record-breaking exports and aggressive international expansion are opening new avenues for growth. The coming quarters will be critical as BYD balances these opposing forces in an increasingly competitive and globalized market.