BYD Versus Tesla, Side by Side: What the Price Gap Is Worth Over 40 Years

Neither brand is the lower price in every pair.

By Neil Solomon · 5 min read

Picture a woman named Beth, 28, who is about to buy her first new car. She will buy a new car every six years for the next forty years, seven cars in all. This article asks one question: in a country where BYD and Tesla sell side by side, how large is the price gap, and what would it add up to if she invested it?

Why this pair

BYD cannot be sold in the United States, so there is no US price to compare. The two brands do sell head to head in Australia, the United Kingdom, Germany and Mexico. A buyer in those countries can choose either one. The price difference there is what a US buyer does not get to choose.

The idea from my book

In the book, I looked at health insurance. Instead of paying US$35,000 a year in premiums for 25 years, I asked what would happen if that money bought shares in the insurance companies themselves. At about 11 percent a year, it grew to roughly US$4 million. At 10 percent, the same deposits reach about US$3.4 million, and at 7 percent, about US$2.2 million. The same method works for a car, with the gap between two prices as the money.

What the head-to-head prices show

Prices are before on-road costs where the source says so. The Mexican pair is from 2024 and a current one is not in the sources. In Australia, Tesla cut the Model 3 by AUD 9,000 on 2 October 2026, which moved that pair in Tesla's favor.

Neither brand is the lower price in every pair. The gap runs both ways, and in the closest like-for-like pairs it is a few thousand dollars.

Where BYD is far lower

BYD sells small cars that Tesla does not make. In Australia the BYD Atto 1 starts at AUD 23,990. The lowest-priced Tesla, the Model 3, starts at AUD 45,900. That is a gap of about US$15,200. It compares different cars, so it is not a like-for-like gap, but it is the gap a buyer who wants the lowest price actually faces.

Who buys what

Buyers do choose BYD in volume, though not by a wide margin overall.

BYD sells six models in Australia and Tesla sells two. In Australia the single top seller is still the Tesla Model Y, at 31,454 units, against 17,277 for the Sealion 7. So the sales lead belongs to the brand with more models at more prices, and not to a single BYD car that beats a single Tesla.

The prices above are not adjusted for each country's subsidies and duties. Germany charges BYD a European duty of 17 percent, as The Price on the Tag Is Not the Real Price shows, and several of these markets give buyers incentives that change from year to year. So I would not call these prices "untaxed and unsubsidized". They show what a buyer in an open market pays.

What the gaps are worth if invested

Beth invests the gap on the day she buys each car, at years 0, 6, 12, 18, 24, 30 and 36, and leaves it until year 40.

For the 10 percent column, I used the S&P 500's long-run record. Aswath Damodaran's data at NYU shows an average of about 10.0 percent a year from 1928 to 2025, with dividends, and about 11.9 percent over the last 50 years. Those figures are my reading of his table, so treat them as close estimates. Returns vary widely from year to year, and no one can promise a rate.

The first two rows are the like-for-like gaps. They reach about US$47,000 to US$277,000 depending on the rate. The third row compares the lowest-priced car of each brand and shows what it can be worth to have a much lower-priced car to choose.

Why the United States has no pair

A Chinese-made electric car entering the United States pays the standard 2.5 percent, a 25 percent vehicle duty and a 100 percent duty on Chinese electric cars, which totals 127.5 percent of the import value. A connected-car software rule also bars Chinese-controlled makers from model year 2027. The Tax You Would Notice and the Tax You Do Not works through that arithmetic. The result is that US buyers have no BYD to compare, and no way to learn what the gap would be.

What the table leaves out

• Beth might not buy a new car every six years, and a car costs money to run and insure wherever it is bought.

• The table does not adjust for inflation or for taxes on gains.

• Trim, battery size and equipment differ between pairs, and promotions change often.

• A gap is not all hidden tax. It is simply what a buyer in an open market can choose.