02 Feb State of China’s Auto Market – January 2026
Written by Bill Russo, Founder & CEO of Automobility Ltd.
Before diving into our year-end China auto market update, I want to share a few perspectives from my recent visit to CES in Las Vegas. CES is no longer just a showcase of new products or breakthrough technologies—it has become a lens into how the competitive landscape is being reshaped by forces that operate at the system level. CES 2026 offered a particularly revealing window into those forces, and into why China’s approach to execution is emerging as a defining advantage in global mobility.
China Auto Market: Defining Headlines for Full-Year 2025
- China’s auto market reset structurally, with full-year vehicle shipments up ~9.4% YoY, surpassing prior peaks and establishing a higher, export-anchored baseline.
- NEVs became the marginal growth engine, rising from 12.9M to 16.5M units in 2025, or ~28% YoY—confirming China remains in the steep scaling phase of the NEV S-curve.
- Made-in China exports evolved into a structural growth engine, rising to 7.1M units, up ~21% YoY, with NEVs reaching ~37% of the export mix.
- Chinese brands consolidated dominance, capturing ~70% PV share and nearly all net market growth, as foreign OEMs continued structural decline.
- Smart EV leadership shifted decisively, with HIMA and Xiaomi accelerating,Leapmotor scaling, and first-generation EV startups losing momentum.
- “Glocalization” moved into execution, as Chinese OEMs fast-tracked overseas manufacturing to mitigate tariff risk and sustain global expansion.
A Look Back: China Didn’t Recover—It Rewrote the Market
Between 2017 and 2025, China’s auto market did not rebound from a downturn. It structurally reset. Total vehicle shipments reached ~34.4 million units in 2025, breaking past the last cycle’s peak and marking the end of an era defined by domestic ICE demand.
But the headline is not volume. It is composition.
In 2017, China’s market was simple: overwhelmingly domestic, overwhelmingly ICE, and largely insulated from global demand. By 2025, that model no longer exists. Electrification and exports have replaced domestic ICE sales as the growth engines of the industry. NEVs now account for roughly 37% of total shipments, exports have expanded more than sixfold, and total market growth is being sustained even as domestic ICE volumes continue to collapse.
This is not an incremental transition—it is a power shift. Domestic ICE sales are down nearly 50% from their 2017 peak, while NEV volumes have grown more than fourteenfold, moving from policy-led adoption to industrial-scale execution. Exports, once a pressure-release valve, have become structural infrastructure, anchoring China’s auto industry to global markets.
The conclusion is unavoidable: China is no longer just the world’s largest auto market—it is the system architect of electrified mobility at scale. The market did not return to its old trajectory after 2017. It emerged on a new one, with a permanently altered powertrain mix, a global export posture, and a competitive model built around speed, integration, and execution.
For the rest of the world, the implication is uncomfortable but clear: this is not a cycle to wait out—it is a structural turning point that will reward those willing to rethink how mobility is built and scaled.
Perhaps the most consequential shift of the past decade has been the rise of New Energy Vehicles—and the extent to which they have reordered the automotive supply chain and the global balance of industry power. For much of the 2010s, China’s NEV market struggled to escape its policy scaffolding. Until 2020, growth was uneven, heavily incentive-driven, and constrained by limited product appeal.
That changed decisively in the early 2020s. The inflection point was not policy—it was execution at scale, catalyzed by localized production, rapid cost compression, and a surge of competitive domestic offerings following Tesla’s entry with the locally produced Model 3. From that moment, NEVs transitioned from a subsidized experiment to an industrial growth engine.
By 2025, the transformation is unmistakable. China produced ~16.5 million NEVs, representing nearly 48% of total vehicle shipments, placing the market firmly in the steep phase of the S-curve. Growth is no longer driven by incentives or early adopters, but by structural replacement demand and exports, with NEVs increasingly embedded in China’s global manufacturing footprint.
Equally important, this is now a locally led market. Chinese brands dominate NEV volume, cost structure, and platform innovation—reshaping upstream materials, electronics, software, and battery supply chains in the process. What began as an electrification transition has become a system-level reallocation of power within the global automotive industry.
The post-2017 slowdown in China’s domestic vehicle market was an early warning signal for global automakers—but one that was widely misread. What initially appeared to be a cyclical demand shock was, in fact, the beginning of a structural reallocation of growth away from domestic ICE consumption and toward electrification and global markets.
As domestic demand normalized and ICE volumes peaked, many global OEMs found themselves over-invested in legacy capacity and underprepared for the pace at which China’s market—and industrial logic—was shifting. The result has been a growing mismatch: excess ICE capacity alongside capital-intensive NEV transitions that struggle to meet traditional return thresholds.
Chinese OEMs responded differently. Rather than defending legacy volume at home, they redirected scale outward. Exports became not a fallback, but a strategy.
By 2025, China exported ~7.1 million vehicles, up ~21% year over year, cementing its position as the world’s largest automobile exporter. More importantly, the composition of those exports has changed fundamentally. NEVs accounted for ~2.6 million units, or nearly 37% of total exports, up sharply from just ~22% two years earlier. Exports are no longer ICE-led by default.
This shift matters. What once reflected an ICE capacity overhang has evolved into a two-track export engine, with electrified vehicles—spearheaded by BYD—now driving incremental growth and redefining competitive pressure in overseas markets. ICE exports remain substantial, but the growth vector is clearly electric, software-defined, and platform-led.
The implication is clear: China’s rise as an export powerhouse is no longer about absorbing excess capacity. It is about scaling a new industrial model globally—one in which electrification, cost control, and system integration increasingly set the terms of competition.
Current State of China’s Auto Industry: 2025 Volume Mix and Segment Performance
China’s auto market exited 2025 at a new structural high, with total vehicle shipments (domestic + export) rising ~9.4% year over year to a record ~34.4 million units, decisively surpassing the prior 2017 peak and confirming a reset in the industry’s operating baseline.
Growth was driven overwhelmingly by electrification. NEV shipments increased by ~3.6 million units (+28.2% YoY), becoming the marginal growth engine of the market. In contrast, ICE volumes declined by ~0.7 million units (-3.6% YoY)—a meaningful contraction, but no longer sufficient to offset total market expansion, as exports now play a central role in sustaining scale.
Taken together, the data confirms a decisive shift in China’s auto market structure: NEVs now define growth, exports anchor volume, and ICE contraction does not place a binding constraint on industry expansion.
Monthly shipments remained firmly above 3 million units into year-end, reinforcing that China’s auto market is operating at historically elevated volume levels, even as year-on-year growth naturally moderated against a strong 2024 base. The data confirms resilience at scale rather than loss of momentum.
As 2025 draws to a close, the industry has clearly shifted from volume acceleration to active supply management. December passenger vehicle softness reflects inventory normalization, policy timing, and shipment deferrals into early 2026, not a breakdown in underlying demand. OEMs are prioritizing margin protection and dealer health over year-end volume push.
There are legitimate reasons for caution as China enters 2026, particularly around the phase-out and tightening of subsidies, which will test underlying demand elasticity and OEM pricing power. Policy support has been an important stabilizer, and its gradual withdrawal introduces uncertainty for both volume and margins.
That said, the adjustments observed in December appear less indicative of demand deterioration than of deliberate supply discipline. OEMs have eased year-end shipment pressure, managed inventories more proactively, and timed production into the new calendar year—suggesting a controlled transition rather than a disorderly slowdown as the market resets into 2026.
China’s Export Engine Is Scaling—and Broadening
As noted earlier, China closed 2025 with record vehicle exports of approximately 7.1 million units, firmly establishing exports as a structural growth pillar rather than a cyclical outlet. With NEVs accounting for more than one-third of outbound volume, China’s export engine is no longer ICE-led by default—and is increasingly shaping competitive dynamics in global markets.
What is changing just as meaningfully is where those vehicles are going.
The (through November) 2025 destination mix shows a clear broadening and diversification of Made-in-China exports, reducing reliance on any single market. Mexico emerged as the largest destination, absorbing roughly 573,000 units (~8% of total exports), reflecting its growing role as both a consumption market and a strategic gateway into North America’s broader automotive ecosystem.
The Middle East and Global South are scaling rapidly. The United Arab Emirates, now China’s third-largest export market, posted ~59% year-on-year growth, while Brazil, Saudi Arabia, and the Philippines all delivered strong double-digit increases. Australia and the UK also recorded robust growth, underscoring rising acceptance of Chinese vehicles in mature, regulation-intensive markets.
By contrast, Russia stands out as the key exception. Exports to Russia fell sharply (~52% YoY), driven not by demand exhaustion but by steep increases in vehicle recycling fees that effectively function as tariffs. These policy changes have materially raised import costs and illustrate how regulatory friction—not product competitiveness—is now the binding constraint in certain markets.
The broader takeaway is clear: China’s export growth is no longer concentrated, opportunistic, or dependent on a single outlet. It is becoming geographically diversified, policy-aware, and structurally embedded, reinforcing exports as a durable second growth engine alongside domestic electrification.
NEVs Now Anchor the Market—Composition Tells the Story
As discussed earlier, China closed 2025 with record NEV shipments of approximately 16.5 million units, firmly establishing electrification as the market growth engine. The significance of this milestone becomes clearer when examining how the mix evolved over the course of the year.
Monthly data shows that year-on-year softness in late 2025 was entirely ICE-driven. December volumes confirm that internal combustion shipments were the source of moderation, while BEV and PHEV shipments both reached record levels, pushing NEV share of production above 52% for the first time. This divergence underscores that structural weakness is segment-specific, not a reversal of the electrification trend.
Within NEVs, BEVs increasingly dominate the growth profile. Throughout 2025, BEV shipments expanded steadily and set multiple monthly records, reflecting widening model availability, aggressive pricing, and improving charging convenience. PHEVs continued to scale in absolute terms, but their share of total NEV volume stabilized as consumer preference tilted toward full electrification in core passenger segments.
The structural implication is clear: China’s market is no longer balancing between ICE and electrified powertrains. ICE volumes now act as the adjustment variable, while NEVs—led by BEVs—define the market’s trajectory. By year-end, electrification had become not just the growth engine, but the default production and allocation logic for China’s auto industry.
China’s Auto Market Is Growing Again — But Electrification Is Doing All the Work
China’s domestic auto market returned to growth in 2025, with total vehicle sales up ~5.8% year over year. But this recovery looks nothing like past cycles. Sales remain well below the 2017 peak, and—critically—there has been no retesting of that high-water mark.
We now have a fundamentally different structure. NEV sales surged nearly 20%, while ICE sales declined more than 5%, meaning 100% of net growth came from electrification. By year-end, NEVs and ICE vehicles were effectively split 50/50, an outcome that would have seemed implausible just a few years ago.
This is the defining break from history. China’s market is no longer growing by returning to its prior peak—it is growing by rewriting the mix. NEVs are now the growth market; ICE is the contraction market. Total volumes may be rising again, but the internal engine of that growth has been permanently replaced.
Policy continuity, trade-in incentives, and aggressive OEM pricing are accelerating substitution rather than expanding demand. China is not rebuilding the 2017 market—it is replacing it. For automakers, the implication is stark: participation in China’s growth now requires full engagement in electrification. Without NEVs, there is no path back to scale.
China’s passenger vehicle market crossed a decisive threshold in 2025, but the deeper story is not simply NEVs overtaking ICE—it is who is winning in each lane, and why.
On the surface, the crossover is clear: NEV sales now exceed ICE sales, confirming that electrification has become the dominant growth engine of the market. Beneath that headline, however, the competitive structure is bifurcating. Only four OEMs overlap between the ICE and NEV Top 10, underscoring that China now operates two distinct competitive arenas with different success factors.
At the top of the NEV leaderboard, incumbents such as BYD, Geely, SAIC, and Chang’an demonstrate that legacy OEMs can successfully transition—if they are willing to abandon legacy economics, accelerate product cycles, and compete on cost, software, and system integration. Their leadership reflects execution, not heritage.
What is newly important in 2025 is the emergence of Smart EV players as a third force. HIMA and Xiaomi have established themselves as credible volume contenders, validating a model where software, consumer electronics DNA, and ecosystem leverage translate directly into automotive scale. Their rapid ascent signals that competitive advantage in NEVs is no longer rooted solely in manufacturing—it increasingly flows from platform integration, user experience, and brand adjacency.
At the same time, Leapmotor stands out among the “disruptors” for its ability to scale beyond niche positioning. Unlike earlier EV startups, Leapmotor is competing on cost structure and manufacturing efficiency, not just product differentiation—highlighting that survival in China’s NEV market now requires industrial-scale economics, not venture-style growth narratives.
By contrast, pressure is mounting on players whose advantages are narrowing. Li Auto’s relative softening illustrates how quickly momentum can shift as PHEV growth moderates and competition intensifies. The Smart EV space is no longer forgiving; scale, cadence, and capital discipline now matter more than first-mover advantage.
Meanwhile, ICE leadership remains anchored by Volkswagen and Toyota, but that position is increasingly defensive. Chinese OEMs such as Geely, Chery, and Chang’an are becoming credible ICE competitors as well—benefiting from brand lift and customer trust earned through NEV leadership.
The strategic implication is clear: electrification is no longer a segment—it is a brand amplifier. Success in NEVs is now reinforcing competitiveness across powertrains, accelerating a broader reordering of brand strength in China’s auto market. The winners are not just those who electrified early, but those who learned how to scale systems, not models.
Foreign OEMs Continue to Cede Ground as China’s PV Market Localizes at Scale
China’s passenger vehicle market has undergone a decisive rebalancing since 2020. Foreign brands have now lost roughly 34 percentage points of market share, while local Chinese OEMs control nearly 70% of total PV shipments in 2025. This is no longer a marginal shift—it is a structural realignment of market power.
In 2025, Chinese brands captured essentially all year-over-year growth, with local OEM shipments rising ~16% YoY. By contrast, most foreign OEM groups continued to contract. German brands declined nearly 10%, Japanese brands fell more than 5%, and while U.S. brands posted marginal growth, it was insufficient to offset multi-year erosion and reflects uneven, brand-specific resilience rather than a broad-based recovery.
The data highlights a widening performance gap. Local OEMs are benefiting from NEV leadership, faster product cycles, aggressive pricing, and deeper localization across software and supply chains. Foreign OEMs, meanwhile, remain unevenly positioned—isolated pockets of strength have not been enough to counteract systemic share loss.
The implication is clear: China’s PV market has transitioned from a globally contested arena to a locally dominated ecosystem, where scale, speed, and integration increasingly favor domestic players. For foreign automakers, the challenge is no longer short-term recovery—it is strategic relevance in a market that has structurally moved on.
The 2025 passenger vehicle leaderboard confirms a structural reshaping of China’s auto market. BYD remains firmly in the lead, with 3.48 million vehicles sold, all of them NEVs, giving it nearly 15% total market share despite modest year-on-year moderation as it prioritizes scale discipline. BYD now operates as a category of its own—less a challenger than a reference point for the rest of the industry.
The more consequential shift sits just below. Geely has decisively overtaken Volkswagen to become the No. 2 player in China, with 2.61 million total sales, driven by NEV growth of more than 80% year on year. Unlike most incumbents, Geely is benefiting from a balanced portfolio, with ICE still contributing volume while NEVs deliver the majority of incremental growth. That portfolio flexibility has allowed Geely to grow total sales by nearly 47%, a result unmatched among large OEMs.
By contrast, Volkswagen’s position highlights the cost of delayed electrification. While it remains the largest ICE player, its NEV volumes are marginal relative to the market, resulting in a near 8% decline in total sales. This pattern repeats across most legacy global OEMs. Toyota’s modest total growth masks continued ICE erosion, while Honda, Nissan, BMW, and GM all posted declining overall volumes as weak NEV performance failed to offset ICE contraction.
Among Chinese incumbents, SAIC and Chang’an illustrate divergent paths. Both posted solid NEV growth, but only SAIC translated that momentum into double-digit total growth, while Chang’an’s gains were more incremental. Chery and GWM continued to scale steadily, reinforcing the depth of China’s domestic bench beyond the top two leaders.
Tesla stands increasingly isolated—a pure-NEV player with declining volumes and sub-5% market share, caught between aggressive local pricing and a rapidly expanding field of Chinese competitors with faster refresh cycles and broader portfolios.
The cumulative message from the 2025 data is unambiguous:
China’s passenger vehicle market is now structured around domestic OEMs that can scale NEVs profitably while managing ICE decline. Global brands that lack competitive NEV portfolios are no longer just losing share—they are losing relevance in the only segment of the market that is still growing.
Conclusion: 2025 Confirmed the New Reality
If 2024 was about momentum, 2025 was about confirmation.
China’s auto market has reset structurally. NEVs delivered all net growth, ICE continued its managed decline, exports became a durable second engine, and leadership consolidated around players built for scale and speed—not legacy advantage. The market no longer behaves as if it is in transition.
As we enter 2026, ambiguity is gone. China now rewards commitment, localization, and execution discipline. The old playbook is not coming back.
We’ll keep tracking who adapts—and who doesn’t—as the new operating reality takes hold.
What We Will Be Watching in 2026:
-
Subsidy tapering and elasticity tests -
Smart EV ecosystem monetization -
ICE cash-flow management discipline -
Regulatory friction in key export markets -
Overseas manufacturing execution risk
AUTOMOBILITY ARTICLES
Where mobility will drive China and the West
China Daily · Dec 17, 2025
The article argues that mobility—not tariffs or geopolitics—is becoming the core infrastructure of the global digital economy. As electric, autonomous, and connected technologies converge, China has emerged as the world’s primary laboratory of scale, translating innovation into system-level deployment through coordinated industrial policy and integrated mobility ecosystems. The West retains strengths in software, design, and governance but struggles to mobilize these assets at scale, resulting in incremental progress. The authors warn against a bifurcation of incompatible mobility systems and advocate instead for strategic interdependence—combining China’s manufacturing scale with Western innovation—to accelerate the global transition to sustainable, intelligent Mobility 3.0.
Where mobility will drive China and the West [China Daily]
The Global EV Outlook: Looking Back at 2025 — and Ahead to 2026 and Beyond
Linkedin Pulse, Dec 22, 2025
The global EV industry reached an inflection point in 2025. Electrification is no longer moving in lockstep across regions. Instead, clear structural divergence has emerged between China and the rest of the world.
China has crossed the threshold from policy-driven to market-driven electrification, while the U.S. and Europe remain more dependent on incentives, hybrids, and consumer confidence. This divergence is reshaping competition, accelerating global exports from China, and redefining what it means to be an automotive company.
The Global EV Outlook: Looking Back at 2025 — and Ahead to 2026 and Beyond
CES 2026: Trends to Watch as the Global Mobility and Technology Race Enters Its Execution Phase
Linkedin Pulse · Jan 4, 2026
CES 2026 marks a decisive shift from invention to execution in global mobility and technology. The core technologies—AI, electrification, software-defined systems, autonomy, robotics, and digital infrastructure—are no longer emerging; they are converging and becoming foundational infrastructure. Competitive advantage is now defined by speed of deployment, system-level integration, and ecosystem coordination rather than standalone innovation. The article highlights four themes: AI as invisible infrastructure, the commercialization of physical AI and robotics, longevity as a platform economy, and energy and infrastructure as strategic enablers. A China–West comparison underscores that the widening gap lies not in innovation capacity, but in execution discipline, scale, and industrial alignment.
CES 2026: Trends to Watch as the Global Mobility and Technology Race Enters Its Execution Phase
How China Turned Tier 0.5 Into Power—and What LG and Bosch Are Betting Instead
Linkedin Pulse · Jan 5, 2026
CES 2026 revealed a deeper shift than the rise of software-defined vehicles: a structural reordering of power in the automotive value chain. The industry is reorganizing around a new Tier 0.5 position—an actor that owns system architecture, controls the software stack, orchestrates the ecosystem, and captures downstream monetization, often without manufacturing the vehicle. This model is already evident in China, emerging in Europe and Korea, and being cautiously navigated by legacy OEMs. Against this backdrop, the CES messages from Bosch and LG Electronics signal strategic positioning choices that contrast sharply with China-native approaches from Huawei, Xiaomi, and BYD. The central issue is no longer whether OEMs matter, but who will control the Tier 0.5 position in the next automotive hierarchy.
How China Turned Tier 0.5 Into Power—and What LG and Bosch Are Betting Instead
Look Back & Look Ahead: Automotive Industry Outlook in 2026 and Beyond
AmCham Shanghai’s Automotive Committee invites you to our 2026 kick-off event, Look Back, Look Ahead -Automotive Industry Outlook in 2026 & Beyond, on Tuesday, January 20, from 9:00 a.m. to 11:00 a.m. in the AmCham Shanghai Conference Room.
In this session, our expert speakers will review the 2025 sales results and discuss the emerging trends and policies shaping the future of the automotive industry. The event will also feature a recap of key insights from this year’s Consumer Electronics Show in Las Vegas. In addition, Bill Russo, Chair of the AmCham Shanghai Automotive Committee, will deliver the monthly market briefing for December.
Look Back & Look Ahead: Automotive Industry Outlook in 2026 & Beyond | AmCham Shanghai
AUTO INSIDER PODCAST
Auto Insider Podcast: Episodes #1 – #5
🎙️ Catch Up on the latest Episodes of the Auto Insider Podcast hosted by Bill Russo. Insights from the front lines of China’s mobility transformation — where speed, scale, and strategy are redefining global competition.
🌏 Episode #5: Safety Without Borders: How Autoliv Drives Scaled Collaboration in the Smart Mobility Era with Sng Yih, President, Autoliv China
🌏 Episode #4: Leapmotor’s Global Leap — A New Paradigm for Global EV Collaboration with Michael Wu, Co-President, Leapmotor
🚗 Episode #3: Competing at China Speed: A Tier-1 Perspective from Magna with Zhen Wu, President of Magna China
🦋 Episode #2: The Butterfly Effect—How China’s Auto Shift is Reshaping the World with Dr. Xiaozhi Liu, Founder and CEO of ASL Automotive, Former CEO of Fuyao Glass
🔧 Episode #1: Smart EVs and the Smart Tier 0.5 Supply Chain with Jack Cheng , Co-Founder of NIO and CEO of M-Mobility
We’re just getting started — more conversations coming soon with the visionaries shaping the future of mobility.
AUTOMOBILITY IN THE MEDIA
China wants more homegrown chips in its cars. The hard part isn’t geopolitics
Channel News Asia, Jan 1, 2026
China’s push to localise automotive semiconductors is often framed as a geopolitical story — but in reality, the hardest problems are technical, architectural, and ecosystem-driven.
This Channel News Asia analysis does a solid job unpacking where localisation is actually happening (mature control chips) — and where it remains difficult (high-end compute for ADAS, autonomous driving, and digital cockpits).
As I noted in the piece:
“Redesigning electronic control units or software stacks around new chips can introduce cascading complexity, particularly for platforms already in production.”
The takeaway:
🚗 Chip localisation in China is progressing — but unevenly
⚙️ The real bottlenecks are validation, integration, tooling, and supply stability
🌍 As Chinese automakers globalise, dual-supply strategies will remain the norm
This is less about ideology — and more about systems engineering, risk management, and time.
Source: https://www.channelnewsasia.com/east-asia/china-cars-domestic-chips-automakers-localisation-5725321
China Delays Plans for Mass Production of Self-Driving Cars After Accident
The New York Times, Dec 23, 2025
🇨🇳🚗“What looked like an imminent L3 rollout was, in hindsight, a marketing-led acceleration running ahead of governance, insurance frameworks and public trust.”
That’s my take in The New York Times on China’s decision to slow mass-market self-driving after a fatal accident.
The move “formalizes a pause — not to stop progress, but to slow it down, narrow the scope and put guardrails around it.”
Not a retreat. A recalibration — putting trust, regulation, and readiness ahead of hype.
Volkswagen’s $3.5B gamble: Can it win back share in the competitive Chinese market
Associated Press, Dec 14, 2025
🇨🇳🚗 Volkswagen Group’s $3.5B China bet: necessary, but is it sufficient?
Volkswagen is making its biggest strategic pivot in China yet—investing heavily in local R&D, devolving decision-making, and designing vehicles in China, for China. The move reflects a hard truth: the old JV-driven, import-the-playbook model is no longer viable.
Key takeaways from The Associated Press article:
⚡ China has become the world’s fastest automotive innovation engine—especially in EVs and software-defined vehicles
🏎️ Speed, cost discipline, and local consumer relevance now define competitiveness
🔄 Foreign OEMs are shifting from teaching China to learning from China
🎯 Success is about survival and relevance—not reclaiming past dominance
As I noted in the article:
“The pace is not a choice but a necessity — and that pressure fuels global competitiveness.”
China is no longer just a market. It is the proving ground for the future of the global auto industry.
Horse power: Renault-Geely engine unit speeds up as EV shift stutters
Reuters. October 16
🚗 Horse Power: Renault–GEELY Engine Venture Rides the Hybrid Wave as the EV Transition Stutters
The latest Reuters feature explores how Horse Powertrain, the Renault–Geely joint venture, is accelerating while much of the EV world takes a breather. Once seen as a relic of the combustion era, the venture is now positioning itself as a “one-stop shop” for efficient hybrid and range-extender engines—bridging the gap between today’s realities and tomorrow’s electric ambitions.
I shared my view in the story:
“If you bet on every number in roulette, you’re going to win — but you won’t make any money because you’ve made too many bets.”
In today’s fragmented transition, automakers face a strategic dilemma — spreading investment too thin across ICE, hybrid, and EV platforms risks profitability. Outsourcing to ventures like Horse can free legacy players to focus capital and engineering resources on their long-term EV transition, while still serving near-term hybrid demand.
🔑 Key Takeaways
⚙️ Hybrid demand remains resilient: With EV adoption uneven across regions, efficient hybrid and EREV (extended-range EV) solutions are filling the gap.
🌍 Global collaboration model: Horse blends European engineering expertise with Chinese scale — an embodiment of glocalization in action.
🧩 Strategic focus is everything: OEMs that streamline portfolios and leverage ecosystem partners will be best positioned to thrive through the transition.
⏳ EV shift continues — but not linearly: While the long-term direction is clear, the journey will be phased, and multi-powertrain strategies will persist well into the 2030s.
This story underscores what we at Automobility Ltd have long emphasized — the transition to electrification is a marathon, not a sprint. Winners will adapt their strategies dynamically, leveraging partnerships and scale to stay profitable along the way.
New Rules Could Force Tesla to Redesign Its Door Handles. That’s Harder Than It Sounds
Wired, October 13
🚪 China Sets the Standard — Again 🇨🇳⚙️
Tesla’s retractable door handles once symbolized futuristic design — sleek, digital, and aerodynamic. But as WIRED reports, they’ve now become the subject of safety investigations in the U.S. and lawsuits over trapped passengers.
Now, China is stepping in with new rules requiring mechanical door handles operable without tools — a move that could reshape global car design.
“This is a classic example of China setting the guardrails early: protecting consumers while quietly shaping global design standards.”
— Bill Russo, CEO of Automobility Ltd, quoted in WIRED
From EV batteries to autonomous driving and now even door handles, China is again leading not just in speed of innovation — but in defining the rules of the game.
The Chinese Billionaire Whose Robots and Cars Should Worry Detroit—and Silicon Valley
The Information, October 4
🚀 XPENG’s leap from EVs to flying cars shows just how fast China’s innovators are redefining the boundaries of mobility.
As I shared with The Information , XPeng’s “flying minivan” is dead serious — not just as a product, but as a signal of intent. It commands attention, demonstrates real engineering depth, and captures the imagination of a market where ambition meets execution.
With affordable EVs like the Mona, luxury models like the P7, and ventures into robotics and aerial mobility, XPeng reflects how China’s auto industry has become the epicenter of global innovation — where cool ideas get commercialized at scale.
About Bill Russo
Bill is a contributing author to the book Selling to China: Stories of Success, Failure, and Constant Change (2023), where he describes how China has become the most commercially innovative place to do business in the world’s auto industry – and why those hoping to compete globally must continue to be in the market.
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