Elon Musk says a Chinese automaker will likely be second to Tesla

Tesla CEO Elon Musk speaks at a shipping ceremony for Tesla China-manufactured Product 3 in Shanghai, east China, Jan. 7, 2020.

Ding Ting | Xinhua News Agency | Getty Visuals

Elon Musk mentioned that a Chinese automaker is possible to be the closest competitor to Tesla, even though stressing the enterprise is “successful in China” correct now.

Tesla has a range of challengers in China in the electric car area, which includes a slew of start out-ups these kinds of as Nio, Xpeng and Li Car.

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Tesla’s greatest rival in China right now is Warren Buffett-backed automaker BYD. Previous year, BYD sold 911,140 battery electrical vehicles globally and a overall of 1.8 million vehicles, when factoring in plug-in hybrids. Tesla delivered 1.31 million vehicles in whole in 2022.

Musk answered a query about the competitive landscape for electric autos on Tesla’s earnings simply call on Wednesday, saying the firm is “fired up about the foreseeable future and, nicely, it truly is going to be wonderful.”

“We have a ton of regard for the motor vehicle corporations in China. They are the most aggressive in the world … they perform the toughest and they function the smartest … so a lot of respect for the China car corporations that we are competing towards,” Musk stated on the Tesla earnings connect with on Wednesday.

“And so, if I have been to guess … most likely some company out of China is the most probably to be 2nd to Tesla,” Musk reported.

Musk claimed that the “Tesla China crew is successful” in the state without having clarifying more.

Tesla’s Model 3 was the fifth very best selling new electricity car motor vehicle in China in 2022, according to the China Passenger Car Association. Vehicles built by BYD and SAIC-GM-Wuling bought a lot more in 2022 than did Tesla’s Product 3. Tesla’s Product Y was the 2nd-most effective offering electrical sporting activities utility car in China, at the rear of a design from BYD.

Musk’s automaker confronted a number of challenges in China last calendar year, such as manufacturing disruptions at its Shanghai factory simply because of the country’s stringent Covid guidelines and component shortages.

Tesla also slice the prices of its vehicles in China in 2022, amid a challenging macroeconomic ecosystem and softening client need.

It is not just the Chinese automakers competing with Tesla. Standard auto giants in the U.S. and Europe also want a slice of the electric auto pie.

Herbert Diess, the previous CEO of German automaker Volkswagen, told CNBC in Could that he believes his company can overtake Tesla to develop into the world’s greatest seller of electric automobiles by 2025.