Tesla is the clear leader in the EV market and has built a huge position among car companies in general. You could almost say it has nothing to fear. But its CEO has a different opinion!

With Tesla having its worst year on record in the markets, Musk had some tough questions to answer during the Q4 investor call. The company's stock, after skyrocketing in 2020 and 2021, has plunged 50% in the past year and has long been at multi-year lows.

Moreover, Musk's behaviour and actions regarding Twitter have not helped. It has made shareholders somewhat nervous.

So Tesla investors probably breathed a sigh of relief when the company reported record sales on Wednesday. Musk said during the call that the company saw its strongest orders in the first few weeks of January so far this year and higher than ever before, suggesting that a series of price cuts around the world helped boost demand.

https://www.youtube.com/watch?v=s_6upDmylRA

What's surprising, though, is that Musk admitted that Chinese companies are the most likely to challenge Tesla's dominance.

"We have a lot of respect for the car companies in China. In our experience, they are the most competitive in the world," Musk said. "They work the hardest and the smartest, and we have a lot of respect for the Chinese companies that we compete with."

"If I had to guess who would be second to Tesla $TSLA, it would be a Chinese car company."

He didn't name a specific name this time, but he has a history of mentioning Nio $NIO, Lucid and especially BYD. Electric cars are big business in China, accounting for two-thirds of EV demand last year.

Demand for EVs in China is huge; a record 6 million EVs were sold in China last year , accounting for more than a quarter of new vehicle sales, and Chinese EV companies are growing to meet demand. And they're growing more than Musk might like.

In fact, China's BYD even overtook Tesla in EV sales in China last year. Musk has praised Chinese automakers in the past, calling them the most competitive in the world even in 2021, while adding that Chinese EV makers boast advanced software designs that could shape the future of the auto industry. That's a great tribute from this mad innovator. But at the same time, he should be a little worried.

They pose a huge threat to Tesla's waning power as demand for its vehicles in China, which currently accounts for 40% of the company's sales, declines. BYD, Tesla's main competitor in China, and other Chinese manufacturers saw a huge increase in sales towards the end of last year, while Tesla's numbers fell by more than 40% in December.

Tesla has cut car prices in China twice in the past few months after the Chinese government removed subsidies for electric cars to boost sales amid slowing demand. The company has since cut prices in the U.S. and other markets as well. Musk suggested during the earnings call that the price cuts appear to have worked, given Tesla's record profits last quarter, and added that the outlook for demand next year is optimistic, despite a likely downturn in the auto market as a whole.

https://www.youtube.com/watch?v=fqB851Zp4K4

What do you think? Who will be "the other guy"? BYD? NIO? Or will one of them be "the first"?

Disclaimer: This is in no way an investment recommendation. This is purely my summary and analysis based on data from the internet and other sources. Investing in the financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.