Jim Farley Says Tesla Lacks 'An Updated Vehicle' To Compete With Chinese EVs, Elon Musk Reveals The 'Limiting Factor'

Ford Motor Co. (NYSE:F) Chief Executive Jim Farley said Chinese electric vehicle makers have become the toughest benchmark for the global industry, arguing that even Tesla Inc. (NASDAQ:TSLA) no longer sets the pace in some of the market's most important segments.

Farley Says BYD Sets The Pace

In an interview published last week by Fast Company, Farley said, "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." He added, "Nothing against Tesla—they've been doing great—but they really don't have an updated vehicle."

Farley said Ford's closest reference point on cost, competition, manufacturing depth and vehicle intellectual property was "really BYD," highlighting how seriously Detroit now views Chinese automakers. He argued that the next wave of U.S. EV buyers wants pickups, SUVs and other body styles priced closer to $30,000 than $50,000, and said Ford needed to respond the American way by using innovation to compete with the world's best.

Tesla Defenders Push Back Online

The comments quickly set off debate online. Sawyer Merritt, an EV-focused commentator on X, highlighted Farley's swipe at Tesla but added that the Tesla Model Y was the top-selling passenger vehicle in China in March 2026 with 39,827 retail registrations, beating both EV and gasoline rivals.

Tesla CEO Elon Musk replied that demand was not the main problem, writing that this was "before supervised FSD is approved in China" and that the "limiting factor is production output in Shanghai."

China Race Tightens Global EV Battle

Tesla still holds a commanding position in the U.S. EV market. Cox Automotive said Tesla sold about 117,300 EVs in the United States in the first quarter, more than all other EV brands combined. Globally, though, the race is tighter. Tesla reported 358,023 Q1 deliveries, while BYD Co., Ltd. (OTC:BYDDF) (OTC:BYDDY) sold 310,389 battery-electric passenger vehicles and 688,993 total plug-in passenger vehicles, including hybrids.

China remains a mixed picture for Tesla. March data cited by CnEVPost showed Tesla retail sales there at 56,107 units, down 24.3% from a year earlier, and Electrek reported first-quarter China retail sales fell 16.2% year over year despite a rise in wholesale output. Reuters separately reported Tesla produced 50,363 more vehicles than it delivered globally in Q1, a sign of swelling inventory.

According to Benzinga Edge Rankings, Tesla offers satisfactory Growth, but fails to offer a favorable price trend in the Short and Medium term.

Price Action: TSLA surged 3.01% to $400.62 at market close on Friday, further surging 0.12% to $401.09 during the after-hours trading session.

Photo Courtesy: Frederic Legrand – COMEO on Shutterstock.com