The Tesla Model Y was Europe's best-selling car overall in the first half of this year, but competition from Chinese automakers is already starting to show its teeth.

While it may or may not be a sign of things to come, the fact is a Chinese EV outsold the Tesla Model Y in a well-developed European EV market in July. The BYD Atto 3 – aka the BYD Yuan Plus in China and other markets – was the best-selling electric vehicle in Sweden last month.

BYD sold 721 units of its compact electric crossover in the Scandinavian country, twice as many Tesla Model Y EVs sold during the same period (359 units). The Atto 3 also outsold the Volkswagen ID.4 (710 units), BMW i4 (385 units), and Skoda Enyaq (370 units), according to data from the Mobility Sweden automotive association cited by Automotive News Europe.

That said, the Tesla Model Y remains the best-selling electric vehicle in Sweden in the first seven months of the year with 8,901 registrations, followed by the Volvo XC40 Recharge (6,660), Volkswagen ID.4 (5,072), and Polestar 2 (1,427).

Gallery: BYD Atto 3

While the BYD Atto 3 was the best-selling EV in Sweden in July, the overall No. 1 spot was taken by the Volvo XC60 ICE-powered SUV, which narrowly beat out the Chinese EV.

The BYD Atto 3 is priced from 445,000 Swedish kronor, the equivalent of $41,500, while the Tesla Model Y starts at 560,160 kronor, or $52,400. The BYD Atto 3 is powered by the automaker's BladeBattery that offers 261 miles (420 kilometers) of WLTP Combined range. 

BYD is currently selling the Atto 3, Han, Tang, Seal, and Dolphin EVs in several western European countries. The company's sales offensive is one of several by Chinese manufacturers, which are intensifying competition in Europe's eclectic EV market.

BYD has been expanding its model lineup, manufacturing capacity, and market presence rapidly in the last two years, challenging Tesla's EV dominance. The Chinese automaker, in which Warren Buffett's Berkshire Hathaway holds a 10.9 percent stake, already is the world's largest EV maker when counting both fully electric and plug-in hybrid models.

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