Chinese carmaker BYD Company ADR BYDDY might have stolen the April electric vehicle title in Europe, but markets didn’t bat an eyelid. Neither did Tesla TSLA shares.
BYD sold 7,231 battery electric cars (BEVs) in Europe in April, edging out Tesla, which sold 7,165, new figures from JATO Dynamics show. Although the milestone represents a symbolic turning point in the European EV battle, it didn’t dent investor faith, as Tesla shares gained more than 2% on the day of the news.
It’s the first time a Chinese brand has outsold Tesla in Europe’s BEV segment, a region where the U.S. automaker has long held the pole position. BYD’s ascent has been swift: the company began serious expansion into Europe only in late 2022.
But markets appear to be betting that it’s only short-term turbulence for Tesla.
Tesla’s short fall in European rankings will be a speed bump, but for ETFs tracking the EV and clean energy theme, the larger picture still seems intact.
Tesla is still a top holding in many of the large ETFs, like the ARK Innovation ETF ARKK, Global X Autonomous & Electric Vehicles ETF DRIV, and iShares Self-Driving EV and Tech ETF IDRV, and today’s market response indicates that few are heading for the exits.
ARKK continues to hold a significant stake in Tesla (12.95%), relying on its push into autonomous mobility, artificial intelligence, and robotics. The upcoming robotaxi pilot and production of the Cybercab next year are part of ARKK’s high-conviction, future-focused strategy. For investors betting on transformative tech, Tesla is still a solid play. The fund was up 1.42% at publication on Thursday.
ETFs like DRIV and IDRV has a wider exposure across the EV supply chain, including traditional automakers, chipmakers and software providers. Tesla is still one of the top holdings in both, but these funds also include companies like NVIDIA Corp. NVDA, Toyota Motor Corp. TM, and Apple Inc AAPL, which help cushion any Tesla-specific volatility.
This diversified approach makes it attractive to investors looking to benefit from the EV trend without putting all their chips on one automaker. Interestingly, though, IDRIV has rejigged its portfolio to dedicate the largest percentage distribution to BYD. Both the funds were fairly non-reactive to the news today.
Tesla’s recent delivery downturn, continuing production interruptions and waiting for updated models such as the new Model Y have caused short-term headwinds.
The stock is down more than 9% so far this year on an aggregate. Nevertheless, the company’s long-term strategy, backed by robotaxis, AI-based innovations, energy storage and next-generation vehicle platforms, is still compelling. Tesla’s pilot robotaxi launch will start as early as June in Austin, while a larger commercial fleet (Cybercab) is scheduled for 2026.
For ETFs such as ARKK, which are constructed on narratives of innovation, Tesla still fits the thesis.
BYD’s increasing foothold in Europe, despite the tariffs on Chinese manufacturers imposed by the European Union, underscores the need for geographic diversification across EV ETFs. Funds like KraneShares Electric Vehicles and Future Mobility ETF KARS, which encompass both Western and Chinese carmakers, are uniquely positioned to capitalize on the worldwide nature of EV growth. BYD is also growing rapidly, doubling international sales in April on a year-over-year basis, and establishing manufacturing platforms in Hungary and Turkey to circumvent EU import tariffs.
Tesla CEO Elon Musk, remains a magnet for attention, some of it unwanted. Protests and controversy surrounding his politics have generated backlash in the U.S. and Europe, creating an overhang for ESG-oriented funds. Nevertheless, for most ETFs, the firm’s role in electrification and renewable energy exceeds the reputation risk, at least in the short term.
Tesla’s affordability, volume expansion, and capital-free manufacturing focus is unbroken. The firm is targeting lower-cost models and expanding production with minimal incremental capital, aiming for a 60% uplift ratio over 2024 levels. Its energy segment is also picking up, with record Powerwall installations and expanding margins.
BYD’s passing of Tesla in Europe’s EV rankings is news-worthy, but not necessarily the turning point. ETF investors and the broader market seem to be seeing through the noise and concentrating on fundamentals. Tesla might be facing choppy waters today, but it remains an ETF pick and is at the center of the future of mobility and innovation.
As the EV industry continues to grow, ETFs that accept Tesla’s long-term vision along with the emergence of legitimate challengers such as BYD might be the most balanced way to go.
Read Next:
Market News and Data brought to you by Benzinga APIs
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.