According to data from the China Passenger Car Association (CPCA), Tesla, the U.S. automaker, sold 78,828 electric vehicles made in China in March, marking an 11.5% decrease compared to the previous year. The sales of China-made Model 3 and Model Y vehicles, however, surged by 156.9% from the prior month.

On the other hand, BYD, a Chinese competitor, witnessed a 23.1% increase in passenger vehicle sales year-on-year in March, totaling 371,419 units. Tesla introduced an upgraded version of the Model Y in China in late February and later in the U.S. and Europe, which helped boost demand as customers awaited the update.

In the first quarter of the year, Tesla delivered 172,754 cars made in China, including shipments to Europe, marking a 21.8% decrease compared to the previous year, reflecting heightened competition, particularly in China. Counterpoint Research suggests that BYD is poised to surpass Tesla as the leading global EV seller this year, with a market share of 15.7%, compared to Tesla's 15.3%.

BYD aims to sell 5.5 million units this year, with a plan to ship 14.5% of the total overseas, through offering free smart driving features and unveiling innovative super-charging EV technology.

To compete with the growing number of Tesla's Chinese competitors, Tesla plans to introduce a more affordable version of the Model Y by utilizing existing production lines in Shanghai, with mass production set to commence next year.