Warren Buffett-backed BYD soars past Tesla in China sales as the company bucks wider EV stock sell-off

• Warren Buffett-backed BYD has avoided a painful stock sell-off in recent months compared to its competitors.
• BYD stock is down just 2% over the past three-months, compared to a 54% decline for Tesla.
• BYD said it sold 1.9 million vehicles in 2022 as it ramps up production despite recent COVID-19 infections.

Warren Buffett's decision to invest in BYD back in 2008 continues to look like an incredibly smart decision when considering its recent performance.

Despite a steep sell-off in electric vehicle stocks among US- and China-based companies, BYD has held its own. 

Over the past three months, shares of BYD are down just 2%. That's compared to a 9% decline in XPeng, a 37% decline in Nio, a 52% dive for Rivian, a 51% plunge for Lucid, and a 54% decline in Tesla over the same time period.

And in the past year, BYD is down just 19%, compared to declines of about 70% for Tesla and Nio, and a decline of 78% for XPeng.

The strength in BYD shares can partly be attributed to its record vehicle sales in 2022. BYD said it sold nearly 1.9 million vehicles in 2022, outpacing Tesla's 2022 sales figure of about 1.3 million. BYD sells both plug-in hybrid vehicles and fully electric vehicles, typically at a lower price point than Tesla's lowest priced Model 3.

The mass affordability of BYD's electric and hybrid vehicles makes them a popular choice for Chinese consumers. That could be one reason why Tesla continues to cut prices in China, with the second cut in less than three months coming this week. Concerns are growing that Tesla may be experiencing a slowdown in demand.

What's especially impressive about BYD's performance in recent months is it appears the waves of COVID-19 infections and lockdowns in China did little to hamper the company's electric vehicle production. That's opposed to Tesla, which was forced to slow down production in China due to the COVID infections. 

While Buffett's Berkshire Hathaway reduced its stake in BYD in 2022 — bagging more than $1 billion in profits in the process — it still owns 16% of the company, according to regulatory filings.