Competitor of Tesla in Europe, BYD, boasts an edge that Musk's company seemingly lacks: a hidden advantage

In the rapidly evolving world of electric vehicles (EVs), a surprising shift has emerged in the market. While Tesla, led by CEO Elon Musk, dismissed hybrid vehicles as a "transition phase" earlier this year, competitors like BYD are reaping the benefits of the increasing popularity of hybrid vehicles.

In Europe, sales of hybrid vehicles have risen sharply in the first half of 2022, with BYD's most sold model, the Seal U, priced around 43,000 euros, leading the pack. This success comes despite the EU imposing a 17 percent tariff on Chinese EVs last year, a measure that only applies to pure electric vehicles, not hybrids.

BYD's success in Europe can be attributed to its focus on hybrid vehicles. The company, which introduced the Seal U in Europe last year, plans to present a new "Touring" version of its hybrid SUV Seal 6 in Germany next month, promising a range of 1500 kilometers.

BYD and another competitor, MG, are increasing their sales in Europe by strengthening their production of plug-in hybrid vehicles. In the first half of 2025, BYD registered around 20,000 plug-in hybrids in the EU, while MG significantly raised its hybrid registrations, even as electric vehicle registrations declined.

Tesla, which only sells pure electric vehicles, is facing a global sales decline. In the US, the company's sales fell by around 12 percent in the second quarter compared to the same period last year. In Europe, Tesla's sales in its third-largest market fell by 40 percent in July 2022 compared to the same period the previous year, despite overall growing sales of electric vehicles.

The faltering sales of Tesla in the US have been attributed to a lackluster product offering and growing criticism of CEO Elon Musk's political statements. The consulting firm Cox Automotive provided data supporting this trend.

Despite Tesla's struggles, the enduring popularity of hybrids comes as no surprise. In the US, sales of hybrid vehicles (which are charged by an internal combustion engine and do not have a charging port) increased by almost 20 percent in July 2022 compared to the same period the previous year. In Europe, sales of plug-in hybrids increased by 52 percent in July 2022 compared to the same period the previous year.

As the market for EVs continues to evolve, it seems that the transition phase Musk dismissed may be here to stay, at least for the time being. The success of hybrid vehicles, particularly in Europe, serves as a reminder that diversity in the market is key to meeting the needs of consumers and driving growth in the industry.