China's BYD, backed by Warren Buffett's Berkshire Hathaway, has announced a profit increase of over 80% in its first set of annual earnings after stealing Tesla's crown as the world's top seller of electric vehicles (EVs). 

Warren Buffett-Backed BYD Continues to Make Impressive Growth, Surpassing Tesla

The Shenzhen-based company's net profit was 16.6 billion yuan ($2.3 billion) in 2022. Last year, it almost doubled to 30 billion yuan ($4.2 billion), the company said on Tuesday. 

BYD said this is despite the company operating in a "complex external environment," citing high levels of inflation worldwide and a stall in growth in most major economies, CNN reported.

The remarkable progress of the Warren Buffett-backed Chinese automaker culminated in its success in beating Tesla as the leading global seller of EVs in the final quarter of last year. During that period, Tesla sold 484,507 battery electric vehicles (BEVs), while BYD sold 525,409.

Overall, BYD sold 3.02 million EVs globally in 2023, a 62% increase from the previous year. That includes 1.44 million plug-in hybrids-a product Tesla does not sell.

In response to this intense rivalry with BYD, Tesla is considering expanding in Southeast Asia to take advantage of the region's fast-growing EV market.

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Intense Price Wars and Rivalry Impacted the Profit of Many Chinese Car Makers, Including BYD

A broader variety of consumers has been attracted to BYD's cars since they are less expensive than Tesla's. BYD's base model costs little more than $10,000 in China. 

On the other hand, the Model 3 is the cheapest vehicle Tesla sells and is worth around $39,000. However, last year's brutal price wars and heightened competition negatively affected Chinese automakers' profit margins. BYD was not an exemption.

New data from the Chinese Passenger Car Association shows that the country's automotive sector had an average profit margin of 5% in 2023, down from 5.7% in 2022 and 6.1% in 2021.

Read More: Elon Musk's Tesla Eyes Southeast Asia Expansion as China's BYD Pulls Ahead