Cathie Wood, CEO of Ark Invest, has expressed confidence in Tesla's ability to maintain its competitive edge in the electric vehicle (EV) market, particularly against Chinese rival BYD. Speaking at the HSBC Global Investment Summit in Hong Kong, Wood acknowledged BYD's impressive vehicles but emphasized Tesla's continued competitiveness in key metrics.

Wood stated, "If you look at metrics like range and power for a given price, Tesla is still very competitive, if not the most competitive, depending on the model of car." She highlighted that while BYD's cars are "fabulous" in terms of fit, finish, and design, Tesla maintains an advantage in critical performance areas.

The Ark Invest CEO also emphasized the importance of Tesla's autonomous driving technology as a key differentiator. Wood projected that robotaxis will "account for 90% of the value of the company in five years" due to the higher margins associated with self-driving software compared to EV sales. This technological edge is something BYD has not yet matched, according to Wood.

Despite recent challenges for Tesla, including a more than 40% drop in stock price from its December highs, Wood reaffirmed Ark Invest's $2,600 price target for the company. This target, issued in June, reflects her belief in Tesla's potential for significant growth, particularly in the robotaxi market.

Wood's comments come at a time when the EV market is experiencing intense competition. BYD's revenue outpaced Tesla's in 2024, and the Chinese company recently unveiled chargers that are significantly more powerful than Tesla's. However, Wood maintains that the overall growth potential of the EV market allows for multiple successful players.

Tesla CEO Elon Musk has also recently highlighted the importance of autonomous vehicles for the company's future value, aligning with Wood's perspective. During an all-hands meeting, Musk encouraged employees to hold onto their stock, citing the profound impact autonomous technology will have on the company's valuation.

As the EV and autonomous vehicle markets continue to evolve, the competition between Tesla, BYD, and other manufacturers is likely to intensify. Wood's analysis suggests that while BYD presents strong competition in vehicle manufacturing, Tesla's focus on autonomous technology could be a crucial factor in maintaining its market position and driving future growth.