Musk pushed back on Sunday against comments from Ford‘s CEO Jim Farley that framed BYD — not Tesla — as the primary competitive benchmark for the American auto industry.
The CEO was replying to an X post by Tesla shareholder Sawyer Merritt — who shared parts of Farley’s appearance on the Rapid Response podcast.
In the interview, Farley said American automakers should look to BYD when evaluating the competitive threat from China.
“If you’re an American and you want us to beat the Chinese in the car business, you’re all going to want to pay attention, not necessarily to Tesla,” Farley said.
“Nothing against Tesla — they’ve been doing great, but they really don’t have an updated vehicle,” Farley said.
Musk pointed to two factors Farley had not addressed: the pending approval of Tesla‘s Full Self-Driving (Supervised) software in China and the output capacity of the company’s Shanghai plant.
“This is before supervised FSD is approved in China. Limiting factor is production output in Shanghai,” the CEO wrote.
GigaShanghai Output
Musk’s reference to Shanghai production output underscores the facility’s increasingly central role in Tesla‘s global strategy.
Tesla delivered over 85,600 electric GigaShanghai-made vehicles in March, an 8.7% increase year over year.
In the first quarter, cumulative deliveries from the plant reached 213,000 units, up 23.5% from the same period last year — accounting for nearly 60% of Tesla‘s global total for the period.
Tesla‘s VP of China Grace Tao said earlier this month that the facility’s product localization rate now exceeds 95% — with over 400 Chinese suppliers supporting production, more than 60 of which have entered Tesla’s global supply chain.
According to China Daily, the Shanghai plant serves as Tesla‘s largest global export hub, having shipped more than 29,000 vehicles in March alone.
The China-led and manufactured Model Y L — a large six-seat luxury SUV — is currently being rolled out across multiple Asia-Pacific markets.
Industry tracker Focus2Move called the Model Y the world’s best-selling passenger model in 2025 — the third consecutive year — with cumulative sales surpassing 4 million units.
Tao also hinted at an expanded role for the plant beyond automotive production.
Earlier this month, a Tesla China executive suggested GigaShanghai could serve as a production site for Optimus humanoid robots, describing the facility as a potential “golden key” to the mass production of the technology.
It marked the first time a Tesla executive publicly floated the Shanghai facility as a potential site for humanoid robot manufacturing — a strategic priority CEO Elon Musk has set for the company.
On Monday, the company clarified that there are currently no specific plans for robot manufacturing in the facility.
FSD in China Still Pending
Musk’s comment also drew attention to the fact that Tesla‘s Full Self-Driving (Supervised) software has not yet received full regulatory approval in China — the world’s largest market for new energy vehicles.
At the company’s annual shareholder meeting in November 2025, Musk said he expected full approval in China around February or March 2026.
He reiterated that timeline at the World Economic Forum in Davos in January.
However, Chinese state media reported in late January that the approval was not imminent.
As of Monday, Tesla still holds only partial authorization to test the system on Chinese public roads.
Grace Tao said earlier this year that preparations are underway but offered no firm timeline, noting that FSD has accumulated more than 7.5 billion miles of real-world driving data worldwide.
The delay comes as Chinese competitors — including XPeng, Baidu, and others — are rapidly scaling their own advanced driver-assistance and autonomous driving systems, many of which are offered to buyers at no additional cost.
In Europe, Tesla‘s FSD (Supervised) secured its first regulatory approval in the Netherlands on April 10.
Musk on BYD’s Output Challenges
Musk’s reply on Sunday is also consistent with recent comments about BYD‘s manufacturing challenges.
In early March, the Tesla CEO commented on BYD’s worst monthly sales decline in six years, calling it “tough sledding.”
The Shenzhen-based group reported a 41% year-over-year drop in vehicle sales in February, its sixth consecutive month of declining domestic registrations.
Musk noted at the time that running a factory below 50% capacity creates significant financial pain, as fixed costs are spread across fewer vehicles.
“Factories do great above 80% capacity, marginal at 60% and mega pain below 50%,” he wrote on X at the time.
Farley on Chinese Competitors
The Ford CEO, on the other hand, called BYD “the best in the business” in the most recent interview — in terms of cost, supply chain, manufacturing expertise, and in-vehicle intellectual property.
Farley has praised the quality and technology of Chinese cars on multiple occasions — including driving a Xiaomi SU7 shipped from Shanghai to Chicago for six months.
At the same time, he noted that BYD and other Chinese manufacturers benefit from heavy government subsidies.
Farley has also said that there is “no real competition from Tesla, GM, or Ford with what we’ve seen from China.”
To him, global automakers that don’t become as cost-competitive as their Chinese counterparts won’t “be around much longer.”
Last week, the Ford CEO called the prospect of Chinese EVs entering the US market “devastating” to domestic manufacturing, telling Fox News that they should be kept “out of our country.”
Days later, however, Farley struck a different tone, stating said Ford “values our Chinese partners” and that the company would “continue to expand these partnerships.”
Ford has reportedly been in discussions with Geely about sharing manufacturing capacity in Europe, and with BYD about supplying batteries for hybrid models outside the US.
The reported talks drew public criticism from White House trade adviser Peter Navarro earlier this year.
Ford’s EV Restructuring
Farley added that the next wave of US EV buyers will want “pickups and utilities and all these different body styles” priced at $30,000, not $50,000, describing China’s progress as “the gift” that forced American automakers to innovate rather than coast on incremental improvements.
The comments are a nod to Ford‘s upcoming Universal Electric Vehicle (UEV) platform.
The Detroit automaker plans to produce a more affordable fully electric pickup truck after cancelling its F-150 Lightning — a segment leader — late last year.
Farley has described the UEV project as one of the company’s “most audacious”, designed to match BYD‘s cost structure in markets like Mexico, where the Chinese automaker already accounts for about seven out of 10 EV sales.
Farley’s comments on BYD came just days after Ford announced yet another restructuring of its EV business, merging its Electric Vehicle, Digital and Design team with its global Industrial System.
Doug Field — a former Tesla and Apple executive who joined Ford nearly five years ago to lead its shift to electrified, connected, and software-defined vehicles — exited the company as part of the reorganization.
Ford‘s EV unit, ‘Model e,’ recorded $4.8 billion in losses in 2025, with an additional $4 to $5 billion in losses projected for 2026.
The company’s CFO Sherry House said earlier this year that the company did not expect its EV business to turn profitable until 2029.
