Overtaking Toyota and Volkswagen 4 Years Later, Where Did BYD Find the 6.4 Million Increment?

In three months, BYD made statements 4 times, announcing its goal of being number one globally.

The first time was at the global shareholder meeting in June, BYD Chairman Wang Chuanfu announced within five years to become the number one car enterprise by scale globally. Subsequently in July, BYD Executive Vice President Li Ke stated "We set this grand goal, relying on endogenous growth, can also achieve without relying on the US market", while also stating no need to pull sales volume through acquiring car companies. In September BYD held the 2026 first extraordinary shareholder meeting in Shenzhen, Wang Chuanfu reiterated that by 2030, BYD must be truly the number one globally in scale. On October 11, Li Ke clarified the company's next stage global strategic goals at a summit in Singapore, planning to overtake Toyota and Volkswagen within the next five years, becoming the world's largest automobile manufacturer.

Such frequent emphasis on the "global number one" goal is relatively rare in the industry. On one hand, it demonstrates BYD's determination to achieve this goal, but it also showcases BYD reinforcing capital market confidence by reshaping the goal. Of course, this is also a goal Wang Chuanfu set back in 2007.

In reality, in the first half of this year, BYD's revenue was 344.8 billion yuan, a year-over-year decrease of 7.1%; net profit attributable to the parent company was 12.3 billion yuan, a year-over-year decrease of 20.5%. In the first half, BYD sold approximately 1.81 million new energy vehicles, a year-over-year decrease of 15.7%. Exports during the same period were approximately 792,000 units, a year-over-year increase of 67.8%. Sales volume, revenue, and profit have not recovered growth. In terms of stock price, performance remains basically consistent with earnings. BYD needs to answer: where is its next growth?

In June, BYD explained that overall sales performance was constrained by the production capacity of the 2nd Gen Blade Battery, and would gradually recover starting from the second half. Through strategies such as Flash Charge + 2nd Gen Blade Battery + Intelligent Driving backup, etc., it aims to strengthen sales performance in the domestic market. Meanwhile, strengthening layout in the international market has become BYD's focus this year.

Looking at the performance of the third quarter, BYD has resumed growth starting from August, with September sales of 463,561 units, a year-over-year increase of 17.0%, breaking a sales record; cumulatively for the first three quarters, BYD's sales totaled 3,131,576 units, still a decline of 3.9%. Among them, domestic sales were 1,788,616 units, a year-over-year decline of 30%; while overseas sales grew directly from 700,000 units year-on-year to 1.34 million units, nearly doubling year-on-year, and the overseas sales share also grew directly from 21% year-on-year to 43%.

According to the current sales progress, BYD is expected to complete 4.5 million or even higher sales volume this year. If it can break through 500,000 units per month, it will have milestone significance. But this is not enough for BYD aiming to hit number one globally. In September, a screenshot of a supply chain document circulated online mentioned BYD's "forecast for material preparation for next year's 7 million whole vehicle production volume, material preparation orders need to be placed urgently", interpreted as BYD preparing materials for a scale of about 7 million vehicles in 2027. Although this number might seem shocking, considering completing annual sales number one in 4 years, this is quite consistent with the growth demand.

From the current view, both BYD and Volkswagen are at the forefront of global sales volume, and both have previously won the global sales number one spot. In 2025, Toyota Group (including Daihatsu, Hino, Lexus) global total sales volume was approximately 11.3 million units, while Volkswagen was 8.98 million units. From the development trend, the Toyota 2026 first half global automobile enterprise sales list was released, with the sales champion in the first half still being Toyota Motor, its global sales volume approximately 5.39 million units, down 2%. Volkswagen Group ranked second with approximately 4.126 million units, down 6.3% year-over-year. From this, under the impact of electrification, both automotive companies have actually shown a trend of decline.

If we assume Toyota declines 2% annually, its global sales in 2030 would be around 10.21 million units, possibly falling below 10 million. Under another assumption, if Toyota maintains 2% growth annually, its 2030 sales would be 12.4761 million units. Therefore, BYD's most optimistic sales volume in 2030 would need to reach above 10 million to achieve the goal. Calculating based on BYD's current annual sales volume of approximately 4.6 million, the current gap is a minimum of 6.4 million.

Of course, as China's largest automobile enterprise, shouting such a slogan is naturally not mere empty talk; this shows that after surpassing Tesla to become the world's largest new energy vehicle enterprise, this Chinese automobile enterprise ranking in the global top ten has enough confidence to complete this goal. The question is, where will these 6.4 million sales volumes come from?

From the domestic market perspective, the overall automobile market has fallen into negative growth. The Passenger Car Association (CPCA) data released on October 12 shows that national passenger car retail sales were 1.618 million units in September, down 28.0% year-over-year, up 5.0% month-over-month; cumulative retail sales from January to September were 13.334 million units, down 21.7% year-over-year. Against this background, domestic sales data for most car enterprises are negative growth, and BYD is no exception. BYD's January-September sales volume was 3.1316 million units, with 1.3378 million units from overseas markets. BYD's January-September domestic market sales volume was 1.7938 million. The changes within are that domestic sales dropped from approximately 2.57 million to 1.79 million (−30%), exports rose from approximately 690,000 to 1.34 million (approximately +95%). Export share nearly doubled, growing from 21% to 43%.

From the current view, the domestic market is unlikely to provide much growth momentum for domestic car enterprises in the future. However, BYD's domestic market performance is not currently bad, with September domestic sales at 276,800 units and overseas sales at 179,800 units. Currently maintaining growth, it may stabilize the domestic market at a 300,000 unit scale. This will contribute 3.6 million sales volume for a year. This means in the overseas market, BYD needs to obtain at least 6.4 million sales volume annually. According to statements from BYD senior management earlier, its focus layout markets are Europe, Central America, South America, Asia, and Oceania markets, and it has clearly stated temporarily not entering the US market. So, how large is the overseas market scale left for BYD?

According to OICA (International Organization of Motor Vehicle Manufacturers) data, the 2025 global automobile market new vehicle sales (passenger cars, commercial vehicles, and all types) was 99.7984 million units, among which China accounted for 34.5%, the US accounted for 16.7%, EU27 + EFTA (Iceland, Liechtenstein, Norway, and Switzerland) + UK accounted for 15.5%. Then India, Japan, and other markets combined accounted for nearly 80%. Then Brazil, Canada, and Mexico in the Americas, plus Russia, South Korea, Turkey, and Australia reached approximately 88% of the global market.

This means, after removing the Chinese domestic market and the temporarily not entering US market, BYD needs to obtain 6.4 million scale in the remaining 48.8% market (approximately annual sales 48.7 million units).

Referring to Toyota and Volkswagen's sales structure, this still has some challenges. The US market, as one of the global three major markets, has always been a key area for Toyota and Volkswagen. Toyota's 2025 sales volume in the North American market was 2.9297 million units, up 7.3% year-over-year. Among them, only the US market sales volume accounted for 86% of North American total sales, reaching 2.517 million units. The Volkswagen Group has not been very well received in the US market, but even so, it contributed over 570,000 sales volume in the US market in 2025, but the gap in the US market led to a 2 million unit gap with Toyota. Additionally, the Japanese and South Korean markets' preference for local brands is also quite obvious, and it is obviously not easy to take over these two markets.

In the European market, local brands are equally strong. After superimposing the new automobile export policy reached between China and Europe, subsequent market changes are still hard to judge. According to foreign media reports, it is estimated that Chinese hybrid and plug-in hybrid electric vehicles exports to Europe will decrease by "millions of units" within four years, equivalent to halving on the original expected scale. According to German independent market research institution Dataforce data, the top three European plug-in hybrid sales in the first half of 2026 were all Chinese models,依次为 BYD Song PLUS DM-i approx 44,700 units, Yuan UP DM-i (ATTO 2 DM-i) approx 31,600 units, Chery Explore 06 C-DM (JAECOO J7 SHS) approx 29,900 units.

BYD is building multiple factories locally to cope with the impact. After production, BYD's dependence on Chinese exports will decrease, but the local procurement ratio will determine whether the factory can continue its original cost advantage. Previously, Europe had restricted Chinese-made electric vehicles, increasing tariffs. However, after tariffs were lowered, the development of Chinese independent brands in Europe was very rapid, and the advantages of the Chinese new energy supply chain and development efficiency are indeed incomparable. Europe, Southeast Asia, Middle East, Central America, South America, and other regions will become the core pillars for BYD. In the situation of lacking ICE vehicles, relying only on plug-in hybrid and pure electric, whether BYD can defeat Toyota depends on oil price changes, electricity price, and infrastructure situations.

From the current trend, the result does not seem too pessimistic. For example, in the Southeast Asian market, Chinese automobiles have already completed a market reversal against Japanese cars. In the Australian market, this used to be a key market for Japanese cars, but this year, BYD's cumulative sales volume has already exceeded 60,000 units, surpassing Ford, Mazda, and Hyundai and other car enterprises, market share reached 8.5%, second only to Japanese Toyota. Calculating obtaining 6.4 million sales volume in the 48.7 million market, each market needs to obtain approximately 13% share. This means no matter which market, it may need to enter the top three or even first place.

However, for BYD there is still four years. With Flash Charge layout overseas, and the development of Intelligent Driving technology, subsequent potential is still continuously improving. BYD started from 2021, in just 4 years completed export volume from less than 20,000 to the 2 million level, growth approaching 100 times. In the coming time, it needs to grow about three times to complete the goal. Of course, subsequently for BYD, its opponents are not just Toyota and Volkswagen, there may be more like Chery, SAIC, Geely and other opponents. The fierce battle in the domestic market will further extend to the overseas market.