🚘️ BYD Speeds Past Tesla in the EV Race

Plus, will Microsoft pass Apple as the most-valuable-company this year?

TOP STORY
🚘️ BYD Speeds to the Top, Passing Tesla in the EV Race

Chinese automaker BYD, a company Musk laughed off in 2021, officially passed Tesla in EV sales in Q4, selling a record 525,409 EVs compared to Tesla’s 484,507.

BYD sold a total of 1.57 million EVs in 2023, a massive 73% jump from the previous year, underscoring the company's growing dominance in the EV market.

Despite this growth and BYD having higher gross margins than Tesla, the stock prices of the two companies tell a different story, with BYD falling 27% in the last year to a $559B market cap and Tesla growing 98% to a $744B market cap.

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“Have you seen their car? I don’t think it’s particularly attractive, the technology is not very strong. And BYD as a company has pretty severe problems in their home turf in China.”

- Elon Musk in 2011

⬆️ The Rise of BYD

While Tesla is top of mind for most, BYD often falls under the radar, so let’s take a quick look at the company’s rise:

🔋 Foundation in Battery Technology

Starting as a mobile phone battery manufacturer in 1995, BYD expanded into the EV market by acquiring a small automaker in 2003 and launching their first car in 2005.

⚡️ Strategic Shift to Electric

BYD’s turning point came in 2008 with the launch of their first plug-in hybrid electric vehicle, coupled with a significant investment from Warren Buffett’s Berkshire Hathaway.

🚗 Innovation with the Blade Battery

BYD's introduction of the Blade battery in 2020 marked a significant advancement in EV technology, offering higher energy density and safety, boosting their EV sales.

🇨🇳 Government Backing

BYD's growth was aided by substantial support from the Chinese government, receiving an estimated $4.3 billion in state aid between 2015 and 2020.

🌐 Global Ambitions

Dominating China's EV market, BYD is now aggressively expanding overseas, with a notable presence in Southeast Asia and plans for a manufacturing plant in Hungary.

😰 Tesla Recalls

With BYD hot on its heels, Tesla is facing its own hurdles, initiating a massive recall of over 1.6 million electric vehicles in China, its largest ever recall in China.

The recalls are due to issues with its Autosteer driving assist feature and with door latches on some models.

Last month, Tesla had to recall over 2 million cars sold in the U.S., including Model S, X, 3, and Y, following a National Highway Traffic Safety Administration (NHTSA) investigation. This investigation found inadequate measures to prevent misuse of the Autopilot feature, potentially leading to accidents.

🤔 What’s Next?

Tesla and BYD currently have ~3x the market share of the next largest competitor, and the competition between the EV giants is only expected to intensify.

Despite BYD’s growth, some experts believe that BYD has not yet reached its full potential. According to Sino Auto Insights, BYD's journey is reminiscent of Tesla's early days, where initial skepticism gradually gave way to industry-leading status.

As we head into 2024, Tesla faces increasing competition from BYD and other Chinese EV manufacturers alongside the traditional carmakers entering the electric arena.

FROM OUR FRIENDS @ COINSQUARE
🪙 Coinsquare - At the Forefront of Crypto's Exciting New Chapter

The anticipated approval of a Bitcoin ETF in the US has been a hot topic in the crypto world, with the SEC expected to announce its decision by Jan 10.

If approved, a Bitcoin ETF would bring significant institutional capital into the market, with BlackRock expected to seed its ETF with $10M in Bitcoin.

If you’re looking for a platform to get some exposure to the crypto markets, definitely check out Coinsquare!

As Canada’s first crypto-native CIRO-regulated cryptocurrency marketplace (meaning they are overseen by the same regulatory body that regulates brokerages), Coinsquare has set a high bar for secure and transparent crypto trading.

Coinsquare has grown to become one of Canada’s largest Crypto trading platforms, enabling over half a million Canadians to participate in the crypto market.

BIG TECH
🍎 Apple's Market Dominance Challenged After a Rocky 2024 Start

Apple stock fell 6.6% in the last week and 3% since New Year’s, dropping its market value by ~$177 billion and marking the worst start to a year on record for the tech giant.

This jeopardizes its position as the world's most valuable stock, narrowing its lead over Microsoft to less than $100 billion.

🤔 What’s going on with Apple?

🧑‍⚖️ Antitrust Concerns

Apple's shares fell after reports that the Justice Department is closer to filing an antitrust case against the company, on top of the ongoing patent issues with the Apple Watch.

🧑‍💻 Pressure from Ratings Downgrades

Apple was hit by two ratings downgrades, with analysts citing a weak economic environment in China affecting iPhone demand.

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“I’ve been covering this company for a long time and I’ve never seen two downgrades before an earnings report.”

- Gene Munster, Managing Partner of Deepwater Asset Management.

📲 Slower iPhone Sales

Apple’s iPhone sales are lower than historical trends, due to lower upgrade rates, softening customer demand, and later-than-usual iPhone release date.

🤖 In the #2 spot, Microsoft is only down 1.6% so far this year. The company's investments in AI, including a $13 billion investment in ChatGPT parent OpenAI, have positioned it favorably in the eyes of investors.

Apple's market value now stands around $2.8 trillion, closely followed by Microsoft at $2.7 trillion.

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