BEIJING, July 2 (Reuters) - China's BYD

posted a 21% rise in second-quarter electric vehicle

sales, closing the gap with Tesla after handing back

the world's top EV vendor title to the U.S. rival in the first

quarter.

BYD sold 426,039 EVs in the April-June quarter, according to

Reuters' calculations based on its monthly sales reports. That's

around 12,000 vehicles fewer than Tesla's vehicle deliveries

estimated for the second quarter.

Tesla is expected to report a 6% drop in April-June quarter

vehicle deliveries on Tuesday, the first time the U.S. firm is

set to post two straight quarters of decline, as it deals with

stiff competition in China and slow demand due to a lack of

affordable new models.

The company may again cede its EV championship to BYD if the

actual results turn out to be softer than estimated, with

Barclays predicting an 11% drop in second-quarter deliveries,

Tesla's biggest ever.

Tesla has hit a speed bump after years of rapid growth that

helped make it the world's most valuable automaker. It warned in

January that deliveries growth in 2024 would be "notably lower"

as a boost from months-long price cuts wanes.

The EV maker has cut output of its best-selling Model Y

electric car by a double-digit percentage number at its Shanghai

plant since March to address weakening demand for its aged

models in China, its second-largest market after the United

States, Reuters reported in May.

By comparison, its top Chinese competitor BYD maintained

steady growth in EV sales, while EV upstarts such as Nio

reported stellar growth last quarter. NIO's vehicle

deliveries in the second quarter more than doubled to 57,300

units.

Price cuts and a growing shift in consumer demand to EVs and

hybrids from gasoline-powered vehicles are the main reasons

behind Chinese EV makers' strong sales in recent months, said

Cui Dongshu, secretary general, China Passenger Car Association

(CPCA).

Sales of new energy vehicles including EVs and plug-in

hybrids in China made up 46.7% of total car sales in May, a

fresh monthly high, as per CPCA data.