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Putting EV Valuations Into Perspective

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Putting EV Valuations Into Perspective

The global push for lower emissions has created a mania around pure-electric automakers. While Tesla leads the charge, institutional investors have also piled into many of its younger rivals.

For example, in 2019, Saudi Arabia’s sovereign wealth fund invested $1.3 billion into Lucid Motors. One year later, it was revealed that Amazon had a 20% stake (worth $3.8B) in Rivian.

To see how quickly EV valuations have ballooned, we’ve visualized the historical market capitalizations (market caps) of 10 prominent automakers.

Legacy vs Pure-Electric

The legacy group includes five top traditional automakers, while the EV group includes the five most valuable pure-electric automakers that are listed on an American exchange.

The following table lists the market caps of these companies at various dates. While XPeng and NIO are listed on the New York Stock Exchange, they do not currently sell cars in the U.S.

AutomakerType20102015202102/22/2022
🇺🇸 TeslaEV$3B$31B$1,061B$849B
🇯🇵 ToyotaLegacy$124B$191B$255B$256B
🇩🇪 Volkswagen GroupLegacy$59B$79B$129B$128B
🇩🇪 Mercedes-BenzLegacy$61B$94B$83B$89B
🇺🇸 FordLegacy$63B$57B$83B$69B
🇺🇸 General MotorsLegacy$55B$51B$85B$68B
🇺🇸 RivianEVN/AN/A$93B$55B
🇺🇸 LucidEVN/AN/A$63B$42B
🇨🇳 NIOEVN/AN/A$50B$35B
🇨🇳 XpengEVN/AN/A$41B$30B

Source: Companies Market Cap

At the end of 2021, Tesla and its four EV rivals were worth a combined $1.3 trillion. This was more than double of the legacy group, which was worth $635 billion. EV valuations have cooled since then, though Tesla is still the world’s most valuable automaker by a significant margin.

U.S. Sales in 2021

Comparing U.S. sales gives an interesting perspective on these companies’ relative scale. Once again, note that XPeng and NIO do not sell cars in America. We’ve provided figures for their home market (China) instead.

AutomakerU.S. Sales in 2021
General Motors2.3 million
Toyota2.2 million
Ford1.9 million
Volkswagen Group630,000
Tesla361,000 (est.)
Mercedes-Benz330,000
XPeng98,000 (China)
NIO91,000 (China)
Rivian920
Lucid 520 (est.)

Source: Good Car Bad Car

Impressively, Tesla has overtaken Mercedes in the U.S. to become one of the country’s top luxury brands.

The Long Road Ahead

To satisfy investor expectations, Rivian and Lucid will need to rapidly scale their production and sales. Failing to do so could lead to significant stock price volatility.

Investors should also note that both companies could experience similar challenges as Tesla, which Musk has referred to as “production hell”. Rivian has already pushed back deliveries of its first SUV, while Lucid customers have been notified of delays due to “fit and finish” issues.

Nevertheless, these young manufacturers are setting some serious goals. Rivian aims to produce one million cars annually by the year 2030, while Lucid is targeting a more conservative 49,000 cars in 2023.

Tesla Goes on the Defensive

Tesla is still the undisputed EV leader, but competition is rapidly heating up.

On one hand, legacy automakers have been investing heavily in EV development, and new models are coming en masse. The Volkswagen Group is the biggest threat, selling 453,000 EVs globally in 2021 (up 96% over 2020). For reference, Tesla reported global sales of 936,000 in 2021.

On the other hand, Tesla must also defend its market share from an onslaught of Chinese entrants. This includes XPeng and NIO, which appear to be on similar trajectories. Both firms were founded in 2014, both sold nearly 100,000 EVs in 2021, and both have recently expanded into European markets. A U.S. expansion also seems to be imminent.

With the entire auto industry moving towards battery powered vehicles, will the market rethink its valuation of Tesla?

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Automotive

Mapped: Where Tesla and BYD Make Their Cars

We map the locations of Tesla and BYD’s present and future EV factories, along with their estimated maximum output.

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Mapped: Where Tesla and BYD Make Their Cars

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

In 2023, Tesla and BYD were the world’s two largest electric vehicle (EV) companies by a large margin, holding 19.9% and 17.1% market shares respectively.

With no other company able to match their scale, these two automakers have found themselves locked in a competition for the global EV crown. In Q4 2023, BYD outsold Tesla for the first time ever by 41,000 vehicles (526,000 vs 485,000). In Q1 2024, however, their positions were switched after Tesla outsold BYD by 87,000 vehicles (387,000 vs 300,000).

To gain insight into this rivalry, we’ve visualized the locations of both companies’ present and future EV factories, along with their estimated maximum annual output. Figures come from a variety of sources, and represent the latest information pertaining to planned production facilities (as of April 2024).

Tesla’s EV Factories

Starting with Tesla, this graphic highlights the locations of their four operational factories. Gigafactory Shanghai is the largest in terms of production output, at 750,000 vehicles per year.

Note that Gigafactory Nevada is not on this list because it produces battery cells, rather than finished vehicles.

CompanyLocationMax Annual OutputEst. Completion
Tesla🇺🇸 Fremont, CA650,000--
Tesla🇺🇸 Austin, TX250,000--
Tesla🇩🇪 Berlin, Germany250,000--
Tesla🇨🇳 Shanghai, China750,000--
Tesla🇲🇽 Monterrey, MexicoTBD2026

Tesla’s China factory is unique in that it’s fully owned by Tesla itself, rather than a joint venture with a local company.

Looking to the future, Tesla’s next factory will be Gigafactory Mexico, which was announced (with few details) in March 2023. According to reporting by Electrek, the Mexican government is eager for the factory to begin construction, despite CEO Elon Musk voicing concerns about today’s high-interest rate environment.

BYD’s EV Factories

Although EV demand is not growing as quickly as it was in previous years, BYD is putting the pedal to the floor when it comes to global expansion. The company has announced factories in various regions including Europe, Southeast Asia, and Latin America, all to be completed within this decade.

CompanyLocationMax Annual OutputEst. Completion
BYD🇨🇳 China (various cities)3,000,000+--
BYD🇹🇭 Raong, Thailand150,0002024
BYD🇧🇷 Camaçari, Brazil150,0002025
BYD🇭🇺 Szeged, HungaryTBD2027
BYD🇮🇩 Indonesia (city unknown)150,000TBD
BYD🇲🇽 Mexico (city unknown)TBDTBD

BYD produced over 3 million electric vehicles in 2023 (BEV, PHEV, and HEV). Given that it had no international factories running during that year, we assume that BYD has the capacity to produce at least 3 million vehicles in China.

Government Subsidies Help Fuel Expansion

If you’re wondering how BYD is funding these ambitious plans, consider this: a recent study by Germany’s Kiel Institute determined that BYD has received over $3.7 billion in subsidies from the Chinese government.

For perspective, this online subsidy tracker reports that Tesla has received $2.8 billion in government subsidies. A large share of this amount ($1.6 billion) was awarded by the state of Nevada, which is where Tesla’s first gigafactory is located.

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