Electric vehicle (EV) investments are still driving headlines. The auto industry’s next phase of growth is dependent upon bringing the price of EVs down to make them more affordable for everyday consumers and to be able to compete with Chinese upstarts Xiaomi and BYD, the latter of which is seeking to debut more expensive models.
Tesla Inc. (ticker: TSLA) continues to hold the No. 1 ranking. But it’s also scrambling to innovate quickly enough to remain competitive in all facets of EV ownership. Additionally, Elon Musk’s work with the Trump administration has cast a cloud of controversy over the marque.
China’s remarkable rise in the EV market is driven by three key moves:
— Raw minerals: With a stranglehold on lithium, cobalt and manganese, China now commands 90% of the EV battery supply chain. Chinese companies are now rapidly establishing battery plants throughout Europe, even as companies like BMW are assembling their EV models in China.
— Customer options: BYD and Xiaomi sell EVs priced at about 25% of the cost of a base Tesla Model 3, making them more accessible to a broader audience.
— Global charging station network: China is rapidly deploying charging stations to bridge gaps between major cities. More importantly, China’s addressing range anxiety and the charging experience — a significant barrier to EV adoption in many countries.
China’s expansion has sparked concerns in the United States about its potential to undermine domestic manufacturing strength. During the first Trump administration, tariffs on low-cost Chinese goods were introduced to protect U.S. industries, and Trump campaigned in 2020 on a promise to further raise them to 60%, despite stiff criticism over inflation and supply chain disruptions. Despite vocally objecting to Trump’s tariffs, the Biden administration ultimately retained them. In May 2024, President Biden actually quadrupled tariffs on Chinese EVs to 100% and imposed new levies on Chinese semiconductor chips. The Inflation Reduction Act of 2022 further complicated the landscape by limiting tax credits for EVs due to sourcing requirements for battery components.
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After making deep investments, re-tooling production lines and investing significantly in electric battery research and development, global car manufacturers were suddenly faced with a steep drop in consumer enthusiasm for EVs. In July 2024, McKinsey published a study revealing that a staggering 46% of EV owners would not repeat their purchase due to range anxiety. Resale values diminished as dealers slashed new car prices to relieve bloated inventories. This volatility has forced manufacturers to heavily reevaluate their net-zero commitments.
Intensified competition from China has driven down EV prices, offering an unexpected advantage for the industry. More affordable options are making electric vehicles increasingly attractive to younger buyers seeking a balance of sustainability, cutting-edge design and cost-effectiveness. As automakers adapt to shifting consumer demands, the second Trump administration is expected to champion Tesla as a symbol of American innovation. Potential policy shifts could reshape the EV market both domestically and globally, positioning the industry at a critical juncture where economic, political and consumer forces will define its future.
Here are the 10 most valuable auto companies by market capitalization in 2025:
| CAR COMPANY | MARKET CAPITALIZATION* | POSITION CHANGE* |
| 1. Tesla Inc. (TSLA) | $878 billion | ?+0 |
| 2. Toyota Motor Corp. (TM) | $252.6 billion | ?+0 |
| 3. Xiaomi Corp. (OTC: XIACF) | $171.5 billion | ?+0 |
| 4. BYD Co. Ltd. (OTC: BYDDY) | $156.1 billion | ?+0 |
| 5. Ferrari NV (RACE) | $79.8 billion | ?+0 |
| 6. Mercedes-Benz Group AG (MBG.DE) | $61.3 billion | ?+2 |
| 7. Volkswagen AG (OTC: VWAGY) | $55.7 billion | ?+3 |
| 8. Bayerische Motoren Werke AG (BMW.DE) | $53.3 billion | ?+1 |
| 9. General Motors (GM) | $51.6 billion | ?-2 |
| 10. Porsche Automobil Holding SE (OTC: POAHY) | $51.4 billion | ?-4 |
*As of 03/24/2025.*Since last article update on Jan. 23, 2025.
10. Porsche Automobil Holding SE (OTC: POAHY)
Stuttgart-based Porsche, a 94-year-old German automaker, is renowned for its legendary sports car, the 911. After struggling in the 1990s with high costs and dwindling production to just 15,000 units, the brand was revitalized by the Boxster, which attracted younger buyers. Recently, Porsche marked 50 years of the 911 with a special edition 2025 911 Turbo 50 Years, limited to 1,974 units.
Porsche recently fell three spots in its ranking. Much of its angst is due to deterioration of its investment holdings, leading to rumors that the Porsche and Piech families may reduce their holdings in Volkswagen. They currently have a 53% stake, but may reduce it to as low as 45%. Like their contemporaries, challenges in the Asian market have also significantly impacted Porsche’s performance. Given China’s prominence as Porsche’s second-largest market, senior leaders are reevaluating key strategies. Electrification challenges have caused executive management to ponder the fate of planned transitions of ICE models to all-electric. Most of the prior plans remained intact, but Porsche will continue to approach the EV market slower than their contemporaries.
Porsche enjoys a deep relationship with its customers. J.D. Power’s 2025 Customer Service Index ranks Porsche dealerships the most trusted for after-market services. But the brand power initiates the customer experience with a top-quality product and the 911 Carrera S continues to make customers swoon. With 473 horsepower and the Sport Chrono package, a driver can sprint from 0-60 in a mere 3.1 seconds and achieve a top track speed of 191 mph. The car commands a starting price of $146,400 for the Coupe and $159,600 for the Cabriolet. But the maker has also promised to debut an additional flagship model, widely expected to be the 992.2 generation of the GT2 RS which historically has been its highest-performing 911 variant. As if that news isn’t enough, Porsche will also deploy its third of four Heritage Design Strategy 911s. Due to its limited quantity and reputation for giddy excitement, it will almost certainly sell out in preorders.
Porsche has disappointed fans with its racing strategy, especially since racing was a defining test of engine performance. In 2024, Porsche pivoted its full focus on Formula E with the Gen-3 Evo Porsche 99X Electric, highlighting EV performance. While earlier comments pointed to a possible renewed interest in rejoining Formula One, the company has affirmed that it is withdrawing fully.
9. General Motors Co. (GM)
Founded in 1908 by William Durant as a holding company for Buick, General Motors rapidly expanded through acquisitions, going public in 1916. In 1921, it patented leaded gasoline as an anti-knock agent, solidifying its reputation as an innovator. Once a symbol of American spirit, GM faced setbacks due to globalization. Its pioneering EV1 electric car failed to gain traction, and in 2009, after receiving $17.4 billion in bailouts, GM declared bankruptcy, preserving over 1 million jobs and $35 billion in tax revenue.
When Mary Barra took the helm as CEO in 2014, GM pursued EV leadership with the Chevrolet Bolt and investment in Cruise, its autonomous vehicle subsidiary. The company offers four major brands: Chevrolet, Buick, GMC and Cadillac. Barra’s strategy has had some hiccups, the most recent being a recall for more than 90,000 vehicles due to a potential transmission defect, with notifications to owners beginning in April 2025.
In the face of continued slower-than-expected adoption of electric vehicles, GM has tumbled three spots. GM has been able to demonstrate strong EV performance in Asia, but face the same Chinese competition as the rest of the field. To turn the slide around, it is doubling down on its Cadillac EV lineup with the goal that one of every three vehicles Cadillac sells in the U.S. will be all-electric. To join the Lyriq SUV, it has launched the luxury Escalade IQ SUV and the Optiq, an entry level crossover. Later in 2025, it expects to roll out the Vistiq, a three-row crossover. The red carpet is being reserved for the Celestiq, a custom-commissioned sedan that will debut in the mid-$300’s. The Celestiq will be hand-built so the opportunity to own one will be very limited.
GM is also deepening its commitment to autonomous vehicles. On March 18, 2025, it announced a strategic partnership with Nvidia Corp. (NVDA) to enhance its technology and manufacturing processes, advancing both driver-assistance systems and optimizing factory automation. This revamped focus follows 2024’s dramatic strategic shift away from Cruise, its $10 billion autonomous vehicle unit, after GM’s driverless testing permits were suspended in California following a crash involving a pedestrian in San Francisco.
In a landmark development, Cadillac has been approved to join the Formula 1 grid in 2026, the first addition of a new team since 2016. Cadillac will initially use Ferrari engines before developing its own power units. Speculation is buzzing about Colton Herta signing with the team, although it would be a huge risk to the IndyCar powerhouse driver to make the change.
8. Bayerische Motoren Werke AG (BMW.DE)
The BMW Group, headquartered in Munich, Germany, encompasses the BMW, Mini and Rolls-Royce brands, as well as motorcycle production and financial services.
BMW had fallen two spots in the market capitalization ranking in 2024, but has since regained a rung. Like their peers, Xiaomi and BYD’s sales have chipped away at BMW’s market share in mainland China, which accounts for one-third of its global EV sales. Recognizing China’s critical role as a growth market, BMW continues to push forward with a comprehensive upgrade of Plant Dadong, its first production facility in China. Additionally, it has invested in a 10 billion-yuan sixth-generation battery project in Shenyang that supports the 2026 launch of its Neue Klasse EV models.
The Neue Klasse, rooted in the 1960s BMW 1500, embodies BMW’s future vision for “digitalization, electrification and sustainability.” BMW is launching the iX3 electric SUV first with an electric 3-series sedan to follow. A performance M3 is also on the drawing board. BMW has centered the driving experience around the “Heart of Joy”. This control unit will handle the major functions around drivetrain, braking, steering, battery charging and regeneration.
Despite challenges in Asia, BMW continues to delight and engage its target market with exclusive offerings and innovations. At the 2024 Monterey Car Week, Rolls-Royce unveiled the pre-sold Phantom Scintilla Private Collection and the one-off Spectre Semaphore EV, its first and only Rolls EV. They continue to impress discerning clients in the Middle East and the Africa (MENA) region with record breaking sales of personalized cars. BMW auctioned a one-of-a-kind 2025 BMW M5 Pebble Beach Concours d’Elegance, featuring an exclusive Frozen Orange metallic finish and gold brake calipers, raising $280,000 for charity. Also at Pebble Beach, BMW introduced the M5 Touring plug-in, long-range hybrid for the U.S. market. With an MSRP of $125,275, the new model, weighing in at an additional 1,100 pounds, faced early skepticism for its heft. but the 717 horsepower powertrain has won over M5 aficionados. Looking ahead, BMW is set to make its return to racing in 2026 with the M2, reinforcing its dedication to performance and motorsport heritage.
7. Volkswagen AG (OTC: VWAGY)
Founded in 1937 and headquartered in Wolfsburg, Germany, Volkswagen is renowned for the iconic Beetle. Another classic, the Microbus, was reimagined in 2022 as the electric “ID Buzz.” Volkswagen also owns several premium brands, including Audi, Lamborghini, Bentley and Porsche.
Volkswagen has turning its ranking around, climbing from No. 10 to No. 7, but its financial situation remains challenging. Volkswagen’s share price has been largely stagnant as it tries to reorient itself through extensive cost-cutting measures not only due to Chinese competition and the slow uptake of EV vehicles like its peers, but also the impact of the Russia/Ukraine war. In 2024, Volkswagen had intense negotiations with its unions that led to sizable cuts to its production capacity. The parties also agreed to a pledge that significantly trimmed its workforce. In December 2024, a massive data breach involving Volkswagen’s software subsidiary, Cariad, exposed sensitive location data and personal contact details of more than 800,000 customers. This incident highlights the growing cybersecurity challenges all automakers face as vehicles increasingly collect and store vast amounts of customer data.
While the same story is playing out in all the non-Chinese competitors, Volkswagen finds itself in an odd synchronicity with those who have contributed to the company’s dire circumstances. For example, Volkswagen plans to halt production at its Osnabruck and Dresden factories and their Chinese competitors that have emerged as the likely buyers. The German defense industry is also stepping into the picture. While the Russia/Ukraine conflict has pushed up costs, it has also created unique partnership opportunities. This week, Volkswagen CEO Oliver Blume mentioned that there have been talks to collaborate with Rheinmetall, Germany’s largest defense firm. Volkswagen’s partnership with Rivian Automotive Inc. (RIVN) has proven mutually beneficial, with additional plans to deepen their collaboration. Rivian contributes cutting-edge technology, while Volkswagen provides scale, strengthening their shared platform initiatives. In early January 2025, Volkswagen also announced a promising new joint venture with XPeng Inc. (XPEV) to deploy 20,000 charging piles spanning 420 Chinese cities. A charging pile differs from a charging station as a stand-alone unit that can be placed in residential homes, commercial buildings and public roadways. Discussions about co-branding charging stations were formally announced on Feb. 5 when the two companies announced that they had signed a memorandum of understanding to open their respective fast-charging networks to each other’s customers. Founded in 2014 and catering to tech-savvy drivers, XPeng officially launched the world’s first artificial intelligence-defined vehicle in November 2024.
With lower-priced models needed to attract buyers, the ID.2all remains on track for a late 2025 unveiling as a 2026 model. It will represent Volkswagen’s most affordable EV priced under 25,000 euros and is expected to replace the popular Golf. After significant consumer feedback, Volkswagen has decided to reintroduce physical buttons for in-car controls, moving away from the touch-sensitive interfaces previously implemented. Volkswagen and its sub-brand Jetta have also announced plans to introduce eleven new car models in 2026, specifically targeting the Chinese market. This lineup includes a mixture of six EVs, two plug-in hybrids, two extended-range vehicles and one ICE model. Volkswagen has set a goal to sell 4 million vehicles annually in the country by 2030. Volkswagen is also considering the development of a Scout-based off-road vehicle with an eye on taking market share from Land Rover’s Defender.
6. Mercedes-Benz Group AG (MBG.DE)
A premier luxury car company, Mercedes-Benz Group has corporate roots going back to 1886. Renowned for its Mercedes-Benz, AMG, Maybach and EQ vehicles, the German automaker has been working to restore its luxury brand prestige after years of declining stock performance.
Through 2024, Mercedes-Benz had seen a steep drop, losing $18.75 billion in market capitalization and tumbling from No. 5 to No. 8 in the rankings. However, they are making pivots that have already brought them back to No. 6. In the now, all-too-common saga, Mercedes, too, faces challenges in the Asian market. Mercedes CEO Ola Källenius, has been a vocal advocate for improving EU-China economic relations, aiming to reduce punitive tariffs through economic partnerships. Källenius and execs of other German automakers have warned that retaliatory measures from Beijing could exacerbate the EU automotive industry’s economic challenges.
The Formula One season opener, the Australian Grand Prix, marked the transition of iconic driver Lewis Hamilton from Mercedes to Ferrari. George Russell has stepped into the senior driver role at Mercedes. At the time of Hamilton’s announcement, speculation had swirled over the near-term stock performance with the loss of potential sponsorships. While little has been said about the impact to Mercedes, Hamilton’s alliance with Ferrari has already brought significant focus to his new team. In sharing his first Ferrari picture on Instagram, he made F1 history as the most-liked post ever, garnering 5.4 million likes after just three days.
Electrification remains a central focus for Mercedes-Benz, with standout models such as the off-road-ready G-Class G580 and the all-electric AMG GT 63 S, rivaling the Porsche 911 Turbo S. They have invested heavily in their “Mercedes me Charge” network and now have over 2 million charging points worldwide. Their newest EV is the luxury CLA with its centerpiece super screen spanning the entire width of the front dashboard. Mercedes calls it the “cleverest car” it has ever made as it can discern driver attentiveness and ensure that eyes remain focused first on the road ahead. They also have the first Purespeed limited-edition speedster in final prototype testing. The model, designed in conjunction with Pininfarina, is devoid of both a roof and windshield. The car incorporates the halo protection system that is used with F1 racing to deflect any large objects or protect the occupants in the event of a rollover accident. The PureSpeed is the first model in their handcrafted Mythos series of low-volume, high profit, specialty cars
On March 18, 2025, Mercedes-Benz announced a strategic investment in Apptronik, a Texas-based robotics company. This partnership aims to integrate Apptronik’s humanoid robots into Mercedes-Benz’s manufacturing processes, assisting with tasks such as moving components and conducting quality checks.
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5. Ferrari NV (RACE)
Founded in 1947, Ferrari is headquartered in Maranello, Italy. Known for its high-value sports cars, Ferrari enjoys some of the strongest global brand recognition in the industry. Committed to preserving its image of exclusivity and luxury, Ferrari follows a low-volume, high-profit model while modestly increasing its deliveries. This strategy has enabled Ferrari to retain its No. 5 spot with a slight increase in market capitalization.
Ferrari famously spends nothing on advertising, relying on its racing performance to speak for itself. The brand’s dedication to elite racing has also produced elegant sports cars that hold their value remarkably well for collectors. Ferrari’s stock soared when it signed Lewis Hamilton for the 2025 Formula One season and the expected frenzy for his first performances affirmed Ferrari’s astute move. However, Hamilton’s results revealed a great chasm in communication between him and his Chief Engineer that Ferrari hopes to rectify before the Chinese Grand Prix on Mar 23rd in Shanghai.
Ferrari has been making a push to diversify its ideal target client. Its CEO, Benedetto Vigna, recently gave an interview where he revealed that new buyers under age 40 now account for 40% of their sales, up from the 30% reported in 2023. Ferrari achieved record sales in 2024, propelled by the 296 GTS, the Roma Spider and their first SUV, the Purosangue. The sales success translated to an 11.8% increase in revenue.
Ferrari intends to launch six new models, including the hotly anticipated first all-electric model on Oct. 9, 2025 as a 2026 model. Priced at $535,000, the prototype has been spotted in various stages of camouflage at its new facility near Maranello. To further their goal of EVs and plug-in hybrids (PHEVs) to account for 60% of sales in 2026, they announced on February 24, 2025 that they are road-testing a new solid-state battery from a U.S. startup, Factorial Energy. It is lithium-metal and potentially will add a 25% longer range capability. Additional research is being conducted on their ability to bring the production costs down to more conservative ranges.
4. BYD Co. Ltd. (OTC: BYDDY)
BYD, short for “Build Your Dreams,” was founded in 1995 by Wang Chuanfu in Shenzhen, China. Starting as a mobile battery manufacturer, the company has since diversified into budget-friendly EVs, trucks, buses, solar panels and monorails. In 2022, BYD transitioned entirely to EV production, leveraging vertical integration to maintain control over its battery supply — a strategy akin to Tesla’s. BYD’s expertise in batteries, the cornerstone of electric applications, is bolstered by its internal supply of critical components.
In 2024, BYD produced over 4.3 million “new energy vehicles,” marking a 41% increase from the previous year. BYD’s market capitalization has grown significantly, adding about $52 billion, while retaining the No. 4 ranking. To support its growth, BYD launched the world’s largest car carrier, the BYD Shenzhen, capable of transporting 9,200 vehicles per voyage.
The EV landscape was rocked on March 17, 2025 when BYD announced its “1000v Super E-Platform.” This ground-breaking advancement allows electric vehicles to gain almost 250 miles of range with just a 5-minute charge, bringing the charging experience into parity with the traditional gasoline refuel experience. BYD plans to complement this technology by building their own network of over 4,000 ultra-fast charging stations across China. BYD’s new charging system uses in-house produced silicon carbide power chips that operate at the ultra-high voltages needed up to achieve these charging speeds. BYD’s Blade lithium-ion phosphate battery is considered one of the safest and most efficient in the industry,
They also announced that pre-sales of its upgraded Han L and Tang L models have begun, the first models that will sport the new battery pack. While many of these competitors are struggling to produce more economical EVs, BYD’s premium models are priced significantly higher at $40,000 to diversify their offering.
3. Xiaomi Corp. (OTC: XIACF)
Headquartered in Beijing, Xiaomi is best known as the world’s second-largest smartphone manufacturer, trailing only Samsung. Founded in 2010 by serial entrepreneur Lei Jun, the company has been dubbed the “Apple of China.” It became the youngest company to join the Fortune Global 500 and went public in June 2018 on the Hong Kong Stock Exchange.
Xiaomi entered the electric vehicle market in March 2021 with a $10 billion investment, In 2024, Xiaomi debuted on the market capitalization rankings with a value of $57.3 billion. By the end of the year, it had soared to the No. 3 spot, doubling its market cap to $115.8 billion. Currently, it has added another $171 billion while retaining its No. 3 ranking. Alongside BYD, these two Chinese manufacturers are significantly squeezing all of their counterparts, both in mainland China and its export partners.
Xiaomi initially expected to deliver 60,000 units, but ended 2024 with 135,000 SU7 deliveries. Updated plans for 2025 targeted 270,000 deliveries, but as of Mar 18, 2025, they have already exceeded 200,000 units. They have now revised their projections to reach 350,000 units in 2025. With aspirations to become one of the top five automakers globally, Xiaomi was featured in Time Magazine’s 2024 list of influential companies. Growth and momentum investors continue to seek the stock to catch the wave on China’s economic rise. The company’s stock in Shenzhen has surged nearly 50% in the past six months.
Keeping in mind that Xiaomi cut its teeth on smartphones, they have just introduced a fully automated “dark factory”, capable of producing one smartphone per second without human intervention. This AI-driven facility in Changping operates 24/7 and represents industry expanding manufacturing capability and operational efficiency.
2. Toyota Motor Corp. (TM)
Toyota had long held the crown as the world’s most valuable car company, but was toppled by Tesla in 2020. Founded in 1933, this Japanese company is headquartered in the eponymous city of Toyota in the Aichi prefecture and includes Lexus, Subaru and Suzuki among its marques.
Like its peers, Toyota has faced similar challenges; but, has held to its No. 2 position in market capitalization. In a surprising shift for 2024, Chinese automaker BYD narrowly outsold Toyota in Japan — a market traditionally dominated by Toyota.
Toyota revolutionized the auto industry with the Prius, one of the first hybrid vehicles, which became the darling of eco-conscious consumers in the early 2000s. Over time, however, environmental advocates criticized hybrids for not fully embracing decarbonization. Toyota, long faulted for lagging on EV adoption, defended its focus on hybrids and alternative technologies. Chairman Akio Toyoda has argued that EVs will ultimately cap at 30% of the global market, with hybrids, hydrogen fuel cells and alternative green fuels playing a significant role in future mobility.
In 2024, Toyota responded to these challenges with the redesigned Prius hybrid, earning praise for its sleek styling and impressive 57 miles per gallon fuel efficiency. For 2025, the model remains largely unchanged but has been rebranded as the “Prius PHEV.” The success of this strategy has prompted Toyota to phase out most ICE models in favor of hybrids across both Toyota and Lexus brands. However, Toyota continues to offer a mix of powertrains to cater to shifting consumer demands. The sixth-generation 4Runner has recently launched and is the first redesign of the iconic vehicle in 15 years. It will still feature both internal combustion and hybrid versions, with the hybrid model having entered production in February.
The company is pursuing sustainability efforts while garnering positive reviews for its flagship models. With more than two decades of hybrid production, Toyota’s pre-owned hybrids continue to dominate reliability rankings, further solidifying its reputation for quality and longevity.
1. Tesla Inc. (TSLA)
Tesla continues to captivate as it evolves from its early days with its sublime Roadster into a conglomerate offering a full lineup of EVs, including semitrucks. The company has positioned itself as more than just an automaker, striving to build a sustainable planet through renewable energy, advanced storage solutions, AI and connectivity.
Under CEO Elon Musk’s leadership, Tesla’s market capitalization has soared, doubling from $689.6 billion in August 2024 to nearly $1.4 trillion in January 2025, the first time an automaker has surpassed this milestone. But, much like one of SpaceX’s rockets, gravity is pulling Tesla back from the stratosphere. While many are looking at the decline to back under $1 trillion as evidence that the DOGE political protests have been effective, that would be an incomplete explanation. The vandalism of Tesla dealerships and individual models being set on fire has caught the attention of insurance companies, especially in California where insurers and insureds are already grappling with the residual fire damage. Last month, the Tesla Model 3, Model Y and Model X became the most expensive EVs to insure.
The fuller explanation is that the activist push-back has converged with the very forceful ramp up of competition from Tesla’s Chinese counterparts at Xiaomi and BYD. These two companies are effectively using their momentum to aim for Tesla’s leading market share in every country where China exports these EVs. As Xiaomi and BYD continue their relentless innovation march, their growth has come straight from Tesla’s coffers. Tesla’s momentum within China has also stalled, registering a 49% drop year-over-year in China shipments for February 2025. While Tesla continues to hold its global brand appeal, the next decade will test its ability to innovate faster and compete with these aggressive challengers, particularly in China, the world’s largest EV market.
While Tesla has been rocked in the new year over its CEO’s controversial role in the Trump administration, the company is continuing to expand the breadth and reach toward a unique vision of a sustainable future. Earlier in the year, the company unveiled a redesigned Model Y that garnered 50,000 pre-orders on it first day. More attention is also being given to the Cybertruck and enhancing Gigafactories. While China is Tesla’s biggest competitor, Musk has established a partnership with them to enhance its Full Self-Driving software. In mid-March, Tesla was granted a permit to initiate a new taxi service in California. Initially, the current model line-up will be driven by Tesla employees for internal purposes. Optimally, Tesla wants to expand the service to the public and fully-automate the cars, but the regulatory process to receive approval is long and daunting. AI-driven robotics and a humanoid robot named Optimus are also on the drawing board.
Most importantly, on Jan. 16, 2025, Tesla filed a patent for a more powerful 4680 lithium iron phosphate (LFP) battery that is expected to disrupt America’s dependency on foreign battery supplies, most notably from China. China had long dominated the global LFP battery market, with Chinese-owned Contemporary Amperex Technology Co. Ltd. (300750.SZ) being the largest producer of LFP batteries. The LFP cells use iron and eliminate cobalt, nickel and aluminum. Cobalt is one of the most costly rare earth minerals used in batteries and is often mined inhumanly. CATL’s patents are expiring which gives Tesla the toe-hold it needs. As the battery is roughly one-third the cost of an EV, these innovations will enable Tesla to finally bring to market a $25,000 Model Y, which will allow them to compete strongly against their Chinese competitors. It will debut in Shanghai and will primarily be sold in China.
The budget Model Y is poised to be a game-changer for Tesla. As a U.S. manufacturer, Tesla will escape tariffs on domestic production bringing even greater parity with Xiaomi and BYD. Tesla’s high quality, fit and finish will enable it to regain key market share in China.
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The 10 Most Valuable Car Companies originally appeared on usnews.com
Update 03/24/25: This story was previously published at an earlier date and has been updated with new information.
