Munich, Bavaria, September 8, 2025: Stella Li, vice president of car manufacturer BYD, speaks during the press day of the International Motor Show IAA (IAA Mobility, International Motor Show) held at the company’s booth in the hall of Messe Munich (Bavaria, Germany) on September 8, 2025.
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As electric vehicle sales growth slows in China, BYD The company expects the country’s EV market to expand, in stark contrast to smaller rival Nio, which recently said the industry’s “golden era” is over.
BYD Executive Vice President Stella Li told CNBC’s Arjun Karpal on Monday that “with all the innovations coming to the market, the Chinese market will quickly push EV penetration to nearly 80%.”
Thanks to state support and a wide range of car options, the penetration rate of hybrid and battery-only cars has grown rapidly in just a few years, accounting for more than half of new passenger cars sold in 2024 and reaching a record high of 62.9% last month, according to the China Passenger Car Association.
Last month, the International Energy Agency announced that the electric vehicle penetration rate in the United States is only about 10%, compared to about 25% worldwide.
Domestic sales are restricted due to the US’ 100% tariff on Chinese-made electric vehicles. BYD was included on the Department of Defense’s list of Chinese military-related companies on Monday, along with several other companies. The EV maker did not respond to requests for comment.
However, BYD expects improvements in battery technology and is optimistic about the domestic market.
Thanks to its fast charging technology, which is said to be able to achieve 70% charging in just five minutes, domestic demand for BYD’s EVs is now about double the demand the company can currently serve, Lee said.
The CPCA announced on Monday that sales of gasoline-powered vehicles in China fell 39% year-on-year in May, citing the impact of soaring oil prices due to ongoing fighting in the Middle East.
Looking ahead, Lee predicts that the next phase of competition will likely focus on driver assistance features.
BYD on May 28 expanded insurance coverage for L2+ driving assistance users, which could increase customer utilization by 5 percentage points to at least 95%, Li said. The company also unveiled its own driver assistance chip.
Lee said BYD will primarily use Nvidia’s driver assistance chipsets, even though BYD employs about 7,000 engineers in semiconductor development. That’s just a fraction of the more than 869,600 employees the automaker employs, according to its 2025 annual report.
Leon Chen, head of mobility practice at YCP, an Asia-focused consulting firm, noted that despite the recovery in May, BYD’s total sales were essentially flat year-over-year.
“The question is not only whether BYD can maintain its leadership in China, but also whether it can defend its position globally as Chinese EV makers compete aggressively in export markets,” he said.
BYD sold nearly three times as many cars in China as the second-largest automaker in terms of new energy vehicle sales in May, ending eight consecutive months of sales declines, the association’s data showed.
BYD struggled to grow domestically and turned to export markets to increase sales.
Mr Lee said the automaker aims to locally produce 75% of cars sold in Europe. He denied allegations from the New York-based watchdog about labor abuses during the construction of BYD’s Hungarian factory, adding that the European Commission had not yet investigated the site.
The EU announced last month that the case fell under the jurisdiction of Hungarian labor authorities.
