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Business Model Comparison between Tesla and BYD: From Supply Chain Integration to Core Technology Competition

In: Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025)

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  • Xinran Li

    (Victoria Hill School)

Abstract

The electric vehicle industry has grown rapidly in recent years, becoming a major area of innovation and investment. Within this sector, Tesla and BYD have emerged as two leading companies, each adopting different business models. This paper compares their strategies in two main areas: supply chain integration and core technology development. Using financial reports, industry data, and business model analysis tools, the study examines how each company manages costs, promotes innovation, and positions itself in the market. Tesla focuses on software innovation and premium branding, achieving higher profit margins through features like autonomous driving. In contrast, BYD relies on deep vertical integration, producing batteries and chips in-house to keep costs low and expand production quickly. The results show that both models offer advantages depending on company goals and market conditions. This comparison helps investors and policymakers understand the trade-offs between technological leadership and cost efficiency in the EV industry, and highlights different paths companies can take to remain competitive.

Suggested Citation

  • Xinran Li, 2025. "Business Model Comparison between Tesla and BYD: From Supply Chain Integration to Core Technology Competition," Advances in Economics, Business and Management Research, in: Maizaitulaidawati Md Husin (ed.), Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025), pages 642-650, Springer.
  • Handle: RePEc:spr:advbcp:978-94-6463-874-5_74
    DOI: 10.2991/978-94-6463-874-5_74
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