These are tricky times to be a big carmaker — though less so if you are Chinese. President Donald Trump’s planned 25 per cent tariffs on imported vehicles and key car parts are meant to force manufacturers to relocate production to the US and create jobs. European and Asian carmakers’ shares have dropped, but so have those of US carmakers, whose costs will rise. Shares of China’s BYD, however, now the world’s biggest maker of electric vehicles, rose on Thursday. The US tariffs may put western carmakers further behind BYD and its compatriots — by pushing their prices up just when Chinese groups are coming out with ever more affordable offerings and whizzy EV technology.
The tariffs come soon after what some analysts have called a “DeepSeek moment” — referring to China’s recent AI breakthrough — for the global car industry. BYD last week announced a superfast EV charging system that it says can add about 470km of range in five minutes. By enabling drivers to charge up an electric car about as easily as filling up a petrol one this could remove a key deterrent to consumers going electric. Weeks earlier, BYD unveiled another techno-leap: a free, advanced self-driving system called God’s Eye that it plans to install across its range.
Grid capacity might yet restrain BYD’s plans for 4,000 fast-charging stations across China, and political and practical barriers could thwart ambitions to build such networks in other big markets. Foreign rivals may, in time, replicate its charging achievements. Yet BYD’s prowess shows the focal point of EV innovation is now China. Beijing’s state-led industrial policy has built a formidable manufacturing base and catalysed a striking shift in purchasing patterns. Pure battery and plug-in hybrid cars are expected to outsell internal combustion engine (ICE) cars in China in 2025, years ahead of western rivals.