Episode #223 - BYD’s Plateau, Leapmotor’s Surge, and Chery’s Global Play

Tu Le and Lei Xing unpack a pivotal month for China’s EV sector — one defined by slowing giants, fast-rising challengers, and a global export push that’s reshaping the industry. 🇨🇳⚡️🌍

BYD’s domestic sales cool even as exports near 1 million units; Leapmotor doubles output, partners with Stellantis, and becomes the new benchmark for cost-controlled EV manufacturing; and Chery’s Hong Kong IPO cements its role as China’s global mass-market powerhouse. Meanwhile, Li Auto stalls, XPeng and NIO regain momentum, and legacy brands from Audi to Ford scramble to stay relevant in China’s hyper-competitive market.

They also hit:

🚙  BYD’s 53 % export mix and rising protectionism in Russia and Mexico

🔋  Leapmotor’s 2026 roadmap and Stellantis licensing play

📈  Chery’s Jaecoo, Omoda and Jetour brands expanding in Europe

⚙️  Li Auto’s i6 launch vs XPeng’s profit push

🏁  Ford’s Bronco EREV for China and Audi’s image reboot

💬  Why Western OEMs must match China’s speed and discipline to compete

Insightful, fast-moving, and grounded in on-the-ground reporting — this is your weekly download on how China’s EV revolution is transforming the global auto industry.

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Chapters:
00:00 Introduction to the Podcast and Hosts
02:17 Current Trends in EV Sales
04:37 Market Dynamics and Competitive Landscape
07:18 Focus on Leap Motor and BYD
10:09 Li Auto's Strategy and Challenges
12:31 Legacy Brands and Their Adaptation
15:08 Cherry's IPO and Historical Context
17:36 Cherry's Global Strategy and Market Positioning
27:33 The Price War in the Automotive Industry
29:23 Quality Improvements in Chinese Automakers
31:13 Manufacturing Complexity and Market Adaptation
33:00 Challenges in Product Iteration and Consumer Demand
35:58 Global Competitiveness and Market Dynamics
38:35 The Future of BYD and Market Competition
44:14 International Expansion and Regulatory Challenges
45:49 Audience Engagement and Future Discussions

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Keywords:

China EVs & More, Tu Le, Lei Xing, Sino Auto Insights, BYD exports, BYD sales 2025, Leapmotor Stellantis partnership, Chery IPO Hong Kong, Chery Jaecoo Omoda, Chery Jetour iCar, Li Auto i6 sales, XPeng growth 2025, NIO L60 factory F2, Volkswagen XPeng CEA platform, Ford Bronco EREV China, Buick Electra L7 launch, Audi E5 Sportback China, Tesla China sales, EV price war Europe, Chinese EV exports Latin America, Mexico tariffs China EVs, Russia auto imports, EV manufacturing China 2026

Transcript

Tu Le (00:00)
 Hi everyone and welcome to the China EVs and More podcast where my co-host Lei Xing and I will go over the week's most important and interesting news coming out of the global EV, AV and mobility sectors.
 
 What Lei and I discuss today is based on our opinions and should not be taken as investment advice. For those that are new to the show, welcome. And to our loyal listeners and viewers, welcome back. We ask that you please smash that subscribe and like button so that you don't miss anything from us in the future. Better yet, help us get the word out about this podcast to others that ‚Åì you think would
 
 enjoy and appreciate our ‚Åì downloads. My name is Tu Le. I am the managing director at Sino Auto Insights, a global management consultancy that helps organizations bring innovative and tech-focused products and services to the transportation and mobility sectors. I write a free weekly newsletter that we use to cover many topics. You can find it at sinoautoinsights.substack.com. ‚Åì
 
 which of course I encourage you all to do. Lei, it's been a while, buddy. What's going on, man? I see that you have a nice jacket on. ‚Åì Can you please introduce yourself?
 
 Lei Xing (01:18)
 Go Detroit, right? Yes, good morning ‚Åì from ‚Åì my side. This is your co-host Lei Xing, former chief editor of China Auto Review, and this is episode 223. And this is a national day holiday break, ‚Åì mid-autumn festival. Your Detroit Tigers are still in the playoffs while my Red Sox are done.
 
 Tu Le (01:39)
 yeah, that's right.
 
 Lei Xing (01:48)
 special episode. I'm kind of pissed, but ‚Åì I'm back stateside. I just got back early this morning, actually. And I feel like half of me is still in China. But trying to get used to, know, the slow pace of life.
 
 Tu Le (02:10)
 that a wolf?
 
 Was it cold or was it still pretty warm?
 
 in Beijing.
 
 Lei Xing (02:16)
 Oh, it's still summer. It's getting cold, but, you know, uh, but, uh, yeah, uh, what?
 
 Tu Le (02:19)
 Okay.
 
 In Michigan,
 
 well, last couple days, it's been more chilly, but it was colder in Munich than it was in Michigan when I landed back. When I landed back in Michigan on Saturday, it was 80 degrees. anyways.
 
 Lei Xing (02:42)
 Yeah, it's
 
 actually been pretty warm. Actually, it's going to heat up on this side of the world. ‚Åì But September sales, should we unpack a little bit of that?
 
 Tu Le (02:56)
 K.
 
 So the 800 pound gorilla is now getting a little bit beat up. Oh goodness.
 
 Lei Xing (03:02)
 $8,000.
 
 Well the thing that stood
 
 out was for the first time in a long time, year on year, sales were down.
 
 ‚Åì I don't think it's panic mode yet, but there's still right almost 400,000 units a month, but it's just much harder to get bigger and higher. That's the message, right?
 
 Tu Le (03:36)
 And we're seeing that the export numbers are key for them to continue to grow because of the intensity of the price war domestically. And I don't know how much lower they can go. Number one, number two, the government is really, really paying attention to any significant price cuts, probably through the end of this year. ‚Åì
 
 beginning of next, so companies are going to have to get creative if they want to take sales away from BYD and some of the larger players.
 
 Lei Xing (04:16)
 Yeah, and if we look at the numbers, I think they're going to get close to a million units sold overseas out of, I expect, 4.5 million, 4.6. That was a number that was kind of reported earlier. That's a significant share, right? One out of 4.5 is, I don't know, 20-some percent, right? ‚Åì Which means they're domestic.
 
 Tu Le (04:40)
 And now
 
 they have the ships to do it.
 
 Lei Xing (04:43)
 Yeah, which means their domestic sales are probably down or flat. I think that's one concerning ‚Åì factor. And then add on top of that, the recent initiatives or ‚Åì actions on the 60-day payment, which I think nobody knows who is actually following suit.
 
 I think that's adding some pressure. one number I saw of how competitive it is in the market is that August and September, there were about 150 models. Now that includes new models, that includes different variations, iterations of existing models, that includes ICE models that were launched during that time.
 
 Talk about a golden September. And we saw the records, right? It's eight to 10 brands had record sales.
 
 Tu Le (05:53)
 ‚Åì let me...
 
 So let me just really quickly, year over year for XPeng, 95 % plus 95%, NIO plus 64%, LeapMotor plus 97%, Geely Group plus 81%, Huawei, HIMA plus 32.5%, Great Wall plus 52.5%, Li Auto down 36%, 37%, and BYD down 11.4%. So the summer feasting, summer...
 
 are not feasting. Li Auto just needs a hug. They were looking at 700,000 units orÂ∑Ɖ∏ç§ö around 700,000 units. They might not hit that number now.
 
 Lei Xing (06:34)
 Yeah.
 
 Yeah, I don't think so. think the L series, it almost feels like when you're back in China, everything is about the I series these days. Nobody talks about the L series really, because they have to focus on delivering the i6 which has gotten quite good reception. And again, for all of these ‚Åì players, what it comes down to is your area of expertise, which is the manufacturing
 
 supply chain game and they're racing to kind of produce as much sell as much as they can produce while at the same time looking over to or 2026 when the purchase tax exemption is halved they got to think about you know how much that drop in q1 is gonna be so there's gonna be a balancing game
 
 ‚Åì going toward the end of the year.
 
 Tu Le (07:49)
 And remember, you'd brought up the supply chain thing. with all these companies that I just mentioned, XPeng NIO ‚Åì LeapMotor, their utilization rates at the factory are much higher than they were a year ago, than they were a few months ago. So this inches them towards profitability. The key would be that they're not pricing their products under what the
 
 costs are. haven't heard any Chinese EV company doing that yet, but ‚Åì does this mean 2026 is a banner year for some of these EV companies? Only if the weaker players leave the market and they're able to stabilize pricing across their products.
 
 Lei Xing (08:40)
 Speaking of one company, one big company on watch is LeapMotor because they're going to double their sales this year. And their plan is to double again in 2026 to 1 million. That's their plan. think that's openly communicated.
 
 Tu Le (08:55)
 And this is going to be at the expense
 
 of BYD.
 
 Lei Xing (09:00)
 Yeah, and I recently visited the LeapMotor and talked to some of their people and they still have two products in the A series, the lower segment, and three products in the D series. They have a D19 coming, which is the six-seat three-row SUV. Those are coming in 2026, plus on top of the C and the B. And if they do so,
 
 I think that's pretty impressive. I've heard people from NIO even saying that's quite impressive from a manufacturing point of view that they can do this.
 
 Tu Le (09:43)
 And they're going to generate licensing revenue from Stellantis.
 
 Lei Xing (09:48)
 And then plus export, They're selling into more markets outside of China. Their cost discipline is quite good, I think, compared to the ones that are still trying to break even. I think they were profitable in the first half of 2025. So they're the kind of the 800-pound gorilla in the smart EV startup space, I'd say, for now.
 
 Tu Le (09:53)
 With the help of Stellantis. With the help of Stellantis.
 
 Well, also they are only one brand and they are primarily in the mass market. sub $30,000 US dollar price point. so, ‚Åì you know, Chery also is doing quite well. They IPO'd, we can talk about that in a second, but you finish your thought.
 
 Lei Xing (10:37)
 Yeah.
 
 No. So the LeapMotor is going to be another player. And it has been a player that has eaten into BYD's market share. And they're going to launch their A series, which is kind of the Dolphin type of segment. And then the larger SUVs, they have an MPV coming. They're going to cover almost every segment next year.
 
 with with era.
 
 Tu Le (11:06)
 Not only every segment
 
 Lei, they also, yeah, EREV and BEV, so.
 
 Lei Xing (11:10)
 Yeah,
 
 yeah, yeah, in tandem, right? So they're probably the one to watch next year. And then you have this flip flop, right? ‚Åì NIO, XPeng they're flying high. Li Auto is kind of in a funk ‚Åì a bit. ‚Åì And what they have to do with the i6, right? It's essentially priced lower than the EREV which...
 
 is usually shouldn't be the case because the e-REVs are usually a little bit cheaper than the BEVs. That's kind of the state where you launch a new model and you want it to be successful and then at the expense of possibly these... I mean the 2025 L-Series were just launched just a couple of few months ago and they feel old.
 
 because of this new I series that are.
 
 Tu Le (12:15)
 And what was
 
 a virtue a year ago, 18 months ago is now quite a burden because XPeng, ‚Åì BYD are growing their export, is really helping pad some of the sales numbers while Li Auto focusing on the domestic market has ‚Åì no other alternative except to double down into the China market because they're still not ready.
 
 yet to export.
 
 Lei Xing (12:46)
 So, Li Auto, they're beefing up their international sales team and a mutual friend, I don't know, ‚Åì I'm not gonna mention the name, but she just moved from Xpeng to Li Auto for international sales marketing. So, I told her it's kind of the right time to switch because Li Auto is in need and there's a lot of lessons to be drawn from what Xpeng has done that Li Auto can learn.
 
 Tu Le (13:00)
 Mmm.
 
 Lei Xing (13:16)
 ‚Åì especially in Europe. ‚Åì
 
 Tu Le (13:22)
 I, I, what, what, what, and maybe they can hire us, but, ‚Åì I would be.
 
 very deliberate on which vehicles I want to export first because there's so many between the L series that it doesn't make sense to export them all. I would lean into one or two of those products and then ‚Åì maybe the i6 because the European market, they're not going to take the L9. There's not many
 
 countries that are going to take that, that, that size vehicle. And, ‚Åì you know, the family orientation that the auto positions itself in China, how much is that going to resonate with European customers? I'm not sure yet. So like having that refrigerator in the backseat, having, you know, the ayi sit in the third row, is that all going to really matter in Europe? So, so they have to be really careful if they want to hit.
 
 hit the ground running and not take those mulligans like XPeng and BYD did and reset international teams and things like that.
 
 Lei Xing (14:41)
 Yeah, I think it's going to be methodical that the auto and strategic where they enter first. Maybe not Europe, maybe, know, some of the other. Sure, sure. That's the primary target. ‚Åì And then I think some of the we're also seeing some momentum. You know, the Buick Electra L7 launch was quite well received.
 
 Tu Le (14:50)
 Well, they're entering the Middle East, aren't they? First. Yeah, so.
 
 Lei Xing (15:09)
 I got to check out the Audi E5 ‚Åì Sportback. I'm telling you, it's pretty good. The way you sit in it and the vibe, it's definitely a Chinese smart EV.
 
 Tu Le (15:15)
 hai hao hai hao.
 
 So, but here's the challenge though, Lei.
 
 Is it an Audi branded vehicle?
 
 Because does it make sense for them to have the four rings in the rest of the world and then have Audi, AUDI in China? Is that the strategy or? Cause that's what's gonna be confusing a little bit, I think.
 
 Lei Xing (15:33)
 Well, it's
 
 I really don't know what makes sense, but I think it's a move that they had to do. It's a bet. It's a bet. Just like Volkswagen, depending on XPeng on the CEA platform, all of their branded vehicles in China, it's a bet. And if it works out, great. If not,
 
 I'm not sure their ‚Åì survivability, that probably will tank. But if it works, I think the bet will pay off. Is that something we'll see next year?
 
 Tu Le (16:25)
 You know, let's emphasize for the viewers and listeners because some of them are obviously new to China EVs & More and we welcome all new listeners by the way.
 
 Let's emphasize how much of a government vehicle brand a lot of young people in China think the Audi four ring brand is. in You tell your story, but let me tell my story first. When I first moved to Beijing, there were a sixes in a eights all over the place in Beijing and it were driven.
 
 There's drivers and there's people sitting in the back. And it was pretty much a government official car. There were military plates on them. There were diplomatic plates on the, you know, it was basically a government car. And the kids that grew up in the early 2000s to the mid 2010s, they are now at buying age.
 
 What they remember as well is that government officials were being carted around in these A6s and A8s. so that is why Audi had to rebrand itself in China. And I don't know if you want to add anything to that.
 
 Lei Xing (17:51)
 Well, I think at this moment, at least from the younger consumers, the post 90s and the teens, ‚Åì I think we've passed that kind of the Audi image official vehicle. And if you look at these recent launches by either Buick, not to mention the Chinese smart EV startups themselves, look what type of brand ambassadors.
 
 they bring on when they launch these vehicles. Look at who Li Auto brought for the i6. The guy's name's Yee-Yang Qian-Shi. He's one of the most popular young stars, actors in China. Zheng Qingwen, the Audi ambassador, she's the top tennis player from China, women's tennis player. The Buick brought...
 
 a similar young actor. These are ways and tactics that they're showing that we're changing our image, right? I think Buick, especially for the Electra, similar to Audi is completely gone from what we felt Buick was in the early days. Or even in 2010s, it's completely different.
 
 Tu Le (19:18)
 And since we're talking about legacy brands, Lei, I'll mention the company on your left chest there launched the Bronco EREV ‚Åì this week in China. So Ford launched the Bronco, which is not going to be sold in the United States, unfortunately, for those that are wondering.
 
 Lei Xing (19:33)
 Yeah. Yeah.
 
 And I think Ford and GM, think they're at least they're getting some help because in the US side, because of the emissions and ‚Åì these long-term policies and regulations that they don't have to be that strict in meeting certain targets somehow. I'm not sure if that's good or bad, but they're also, right, these US American brands are also trying different things in China to be.
 
 Relevant, like the Germans. Yeah, you have to do it, right, to compete.
 
 Tu Le (20:13)
 I think it's great. I think they have to. ‚Åì
 
 And again, this is to the benefit of the Chinese consumer, ‚Åì you know, because
 
 Lei Xing (20:24)
 And Ford recently
 
 unified their sales channel into one of the one Ford combining the JMC and Changan and Ford. So that's another tactic.
 
 Tu Le (20:37)
 Well, they weren't selling enough volume to really have
 
 multi-channel strategy. And let's mention that JMC is helping on the Bronco side, on the SUV side ‚Åì for Ford. And Chang'an is helping on the commercial side, I want to say. ‚Åì
 
 ‚Åì So let's talk Chery IPO. ‚Åì
 
 Lei Xing (21:10)
 Yeah, I can start or you want to start. know, Chery. No, think Chery just to give a historical.
 
 Tu Le (21:14)
 Go ahead, go ahead.
 
 Let's give a little history lesson first because I want to hear about this history lesson.
 
 Lei Xing (21:21)
 historical perspective.
 
 First of all, the chairman, the president in Tongyao, I think the other, he's the longest-serving CEO of a Chinese automaker. Other than him, the only other two that I can think of are Wang Chuanfu of BYD and Jack Wei of Great Wall Motor. Maybe we can put ‚Åì Li Shufu in there, but he's kind of the chairman. He is not the CEO role anymore.
 
 ‚Åì That's number one. Second, Chery is nicknamed, they started from this little xiaocaofang, which means ‚Åì the little hut, the little grass hut in a city, Wu Hu, which is like tier five, four or five city. Yeah. And so that kind of historical perspective makes this IPO very ‚Åì
 
 Tu Le (22:10)
 You're fine!
 
 Lei Xing (22:21)
 because it's a long path. And now Chairman Yen, I he's all white hair. I mean, we can call him grandpa Yen, right? Because he's been at this since 97. So almost 30 years. For him to finally IPO, I think the industry ‚Åì looks at it as, you know, finally getting over that hump, right? That's kind of the historical perspective. And then,
 
 The other one is that Chery is the biggest exporter, bar none. IC East, very important, IC East. They sell half of their vehicles outside of China, pretty much. Yeah, maybe more than half. They sold 2 million vehicles in the first nine months, I think. And I believe, yeah, roughly half are exported to the rest of the world.
 
 Tu Le (23:05)
 More than half, 53%.
 
 Lei Xing (23:22)
 And I think in terms of growth, they're like they claim to be in 2024 their passenger vehicle sales grew grew 49.4%. They're claiming to be that's the fastest growth among the top 20 passenger vehicle makers in the world. And their number one exporting ICEs
 
 They're number one growth in NEVs, I think. they've been, get this, since 2003, they've been the top Chinese independent passenger vehicle brand exporter, top, for 22 years in a row. So just some of the significance behind the IPO.
 
 Tu Le (24:19)
 So there's, let's just summarize some of the brands and you fill in the blanks, the ones that I'm missing. They have Chery, have Jaecoo, they have Omoda, they have Jetour, iCar, Hi, Omar, Exceed, ‚Åì Luck, yes, Luxeed. And ‚Åì let me throw a little bit of a wet blanket on those numbers because...
 
 Lei Xing (24:31)
 Exceed. Luxeed.
 
 Tu Le (24:45)
 As they IPO'd in Hong Kong, there's some regulations that they needed to adhere to, meaning if they continue to export to Russia, one of their largest markets, the two largest markets are Mexico and Russia. They export mostly ICEs into Russia, almost 25 % of their sales volume goes to Russia. So that 49 % year-over-year growth that you were talking about,
 
 A lot of those cars shipped to Russia. They said prior to their IPO that they're exiting the Russia market. So that's a big chunk of sales that they said they're going to walk away from. so that let's see which markets they try to push into to make up for that. Because in Mexico, the tariff is likely going to double.
 
 from 25 to 50%. Okay. And there isn't as much competition in Russia. ‚Åì so the street was very optimistic. The share price popped, but you know, it's actually a little bit concerning to me because they ship.
 
 50 % or over 50 % of their vehicles abroad with the protectionism going up. But the other thing that was really, really impressive that I didn't realize is that they build either manufacture or ship kits to six or seven markets already. they're
 
 They're the envy of a lot of companies because they're pretty diverse with a manufacturing footprint outside of China that's right now better than BYDs.
 
 Lei Xing (26:34)
 God.
 
 Yeah, I kind of dropped into their Jaecoo / Omoda There was a press conference at Munich. And some of the numbers they showed were quite impressive of launching into Europe and the German ‚Åì market. And some of those models are already produced in Spain with their partner. ‚Åì So I think European region in general, regardless of the tariffs, will be a major.
 
 region to push and they're launching the regular hybrids. I forget the term. I think it's called the S some hybrid. It could be super hybrid or something. And some of those are already produced in Spain, which they have to have the right products. It's not just necessarily bringing the same models from China. Right. We talked about earlier in the show, ‚Åì which have
 
 help them succeed relatively. yeah, mean Russia that's kind of a question mark and then 50 % it's a double-edged sword, right? Double-edged, you know, it's both good and bad. But I think they're one of the ones that are also growing significantly among the ones that we talked about.
 
 Tu Le (28:10)
 So companies like Chery, companies like LeapMotor, companies like BYD, that...
 
 are built on manufacturing and launching affordable vehicles. The world is their oyster because that lends well to Africa, that lends well to Southeast Asia, that lends well to Latin America. And the legacy automakers, their strategy for those markets historically has just been to decontent. Okay. So could you imagine now having to
 
 compete in Mexico against ‚Åì a fairly fully featured Seagull or a seal. If you're a legacy automaker, you better step it up. And when we look at Chery, BYD's constraint is we only ship PHEVs and BEVs. Chery still ships ICEs. And for the foreseeable future, Africa, Latin America, Southeast Asia, these same regions, India are
 
 Lei Xing (28:54)
 Sure.
 
 Tu Le (29:17)
 really going to still purchase ICEs, you know, due to the constraints in capital or ability to ‚Åì invest in infrastructure, ability to invest in the grid as more and more clean energy vehicles enter those markets. The constraint is not going to be volume from the Chinese. The constraint is going to be how many can take it, you know, how many can plug into the grid without it exploding or being over ‚Åì
 
 overburden. So I think that's kind of also the interesting part because if you look at GM, ‚Åì 70 % of their exports are shipped to China, I mean to Mexico. And so that could really do some damage to GM outside the very few markets that they still sell in volume. It could do some damage to them.
 
 Lei Xing (30:16)
 And then just to add, mean, their official Chery IPO release, they actually gave out a breakdown of the capital raise, how they plan to use it. So 35 % are for R &D of different models for passenger vehicles for the product mix. 25 % for the next generation tech R &D, 20 % for overseas, 10 % for production in WuHu.
 
 and 10 % for the operating capital ‚Åì use. So that's kind of a summary of their ‚Åì IPO ‚Åì capital raised.
 
 and
 
 Tu Le (31:05)
 I think Chery is well positioned. Again, they have to be careful though, because China is, they need to really lean into China and be competitive there. They can't become an export only ‚Åì company. And that's the current trajectory, unfortunately. That's the only risk that I see.
 
 Lei Xing (31:14)
 Well, check.
 
 So, Kerry, they're
 
 so global ‚Åì that the last couple of years, I'm sure you remember this as well, that they've brought a train, a high-speed rail worth of their international media and dealer partners, where they have this global partner conference. I think they've done this the past couple of years. So...
 
 Tu Le (31:54)
 Didn't they
 
 fly 747 worth of people for Shanghai in 23?
 
 Lei Xing (32:01)
 They might have I'm not sure but I know for a fact that they brought like like a trains worth of dealer partners to Wuhu
 
 Tu Le (32:12)
 And here's the reality as well, that the foreign markets that specifically a Chery, a BYD, a Geely, and a LeapMotor Play-in, they will export that price war. They will export that price war. Let me repeat that. And so the legacy automakers that have significant share in their domestic markets, whether it's Spain, Italy, some of the Southern European countries that
 
 Lei Xing (32:29)
 Mm-hmm.
 
 Tu Le (32:42)
 still have a strong foreign presence, Peugeot, Renault, those types of companies, you better sharpen your pencil and you better bring great products because LeapMotor, BYD, the collective, not just one brand, but the collective will take your share.
 
 Lei Xing (32:58)
 And those shares have been growing in Europe despite the tariffs, right? So ‚Åì it's not gonna really stop, put a huge wall unlike the US.
 
 Tu Le (33:14)
 I do have to step back, reflect a bit in the early 2010s when I would see Chery vehicles. were absolutely, they were absolute pieces of S you know, POSs. So BYD and Chery within a 12 year period have improved so much. ‚Åì
 
 Lei Xing (33:31)
 You're the best.
 
 Tu Le (33:42)
 It's impressive, man, because if we look at Ford and some of the legacy automakers, their warranty costs are really, really weighing them down. And you look at the opposite where Chery and BYD have just made leaps and bounds on the quality, reliability, design, fit and finish of these cars.
 
 in just a 10 year period. don't know. That's what makes it so difficult for the legacies to really.
 
 keep up.
 
 Lei Xing (34:22)
 And then the key
 
 part of it is not just time to market. The key part of it is time to ‚Åì pivot, time to decision making, which I personally feel I'm sure you do. Every time I go back, it feels like a new ballgame. Something has changed. Whether it be the auto, let's say launching the i6. First of all, was an online launch.
 
 There was no pre-sale. It was just launched. Delivery started. These tactics, they change fast. if you don't pay attention, you run into using some of the old outdated tactics, which no longer work in China. I think that's the difficult thing. I think the time of the market, they've solved the problem.
 
 Tu Le (35:17)
 And we should remind people.
 
 We should remind people that Li Auto was an EREV company until the ‚Åì L8 and L6. or I eight and I six. So they have increased complexity of their manufacturing by orders of magnitude, not like incrementally, you know, they, they are completely changing, ‚Åì parts of their manufacturing to accommodate the I six and the I eight. And they're still being.
 
 So the L series, a lot of them are being built in Lanzhou. Is it Lanzhou? Lanzhou? ‚Åì And then they do also have a factory in Beijing. those two locations are building ‚Åì their irrevs. And then in Beijing, they're building the battery electric vehicles. So ‚Åì Beijing is becoming an important manufacturing ‚Åì
 
 Lei Xing (35:57)
 In Changzhou, Changzhou, Changzhou.
 
 Tu Le (36:21)
 ‚Åì location for China because Xiaomi is also building there as well.
 
 Lei Xing (36:28)
 Yeah Xiaomi, I mean they had a huge step up in September. It was 30,000 in August and then boom like 40,000 in September. mean that's behind that is really manufacturing that you just mentioned. Yeah.
 
 Tu Le (36:42)
 And I think they could have shipped more. mean, demand-wise, I don't think it's demand challenge.
 
 I think they're trying to ramp, but responsibly. Because I don't think they want ‚Åì quality issues to creep up. ‚Åì But they should be able to get to 50,000 units by the end of this year, I would think, pretty easily. Yeah, so. ‚Åì
 
 Lei Xing (37:03)
 ‚Åì easy, And we're actually
 
 speaking of, we talk about NIO a bit. NIO, they should be able to get to 50,000 units from what it looks now. There are 35,000 roughly. I'm sure, I mean, I was recently at F2. Yeah, I was at F2 just a couple of weeks ago. Not last week, but the week, well, last week.
 
 Tu Le (37:22)
 Mm-hmm. L60's building, continuing to build momentum, so.
 
 Lei Xing (37:32)
 Yeah, maybe the week before. I'm bad with timing. But ‚Åì the latest visit, mean, the assembly lines were quite humming because they're building the L60s in F2, the L90 in F1, and the new ES8 in F3. ‚Åì I mean, can, capacity wise, they shouldn't have a
 
 It's just a matter of, again, getting to break even, getting to those sales targets. And how do you maintain? mean, for a company like LeapMotor, they can double next year. Sure. OK. But for NIO what happens next year?
 
 How do you keep that momentum?
 
 That to me, I think this year, the picture is pretty clear with three months ago. But.
 
 Tu Le (38:31)
 But, Lei, I think we've
 
 also, and I think you would agree with this. I think they've also reached a limit on how fast they can iterate. ‚Åì You know, I don't know how much faster, I don't know if the consumer wants changes, you know, more than, or as,
 
 Lei Xing (38:49)
 Exactly.
 
 Even, mean, the Qing Lihong, he admitted that the 2025 newer versions of the 5566 are not selling as expected. Okay, and those were just renewed right before the summer.
 
 So that's a kind of a condition. I don't know what kind of a, you will call that. It's a, you do that and then it falls under expectations. And then what do do again? You iterate again.
 
 Tu Le (39:32)
 Well, I should mention I was in Munich last week and celebrated Oktoberfest with my wife. So that was really fun. And then I spent a couple of days in...
 
 Lei Xing (39:42)
 Did you put on the
 
 entire tire or no?
 
 Tu Le (39:46)
 No, I
 
 didn't buy one, man. I was supposed to go with a few mutual friends, a few of our mutual German friends, but ‚Åì they couldn't join, so my wife.
 
 Lei Xing (39:50)
 you
 
 So you got to see what
 
 the Oktoberfest is all about. You got to see it.
 
 Tu Le (39:59)
 man, I
 
 was blown away. I actually was kind of cynical. I thought it was just going to be a bunch of drunk Germans, but like everybody's wearing lederhosen, a lot of American English being spoken. So they're either Canadian or American, probably American. So it is a huge, huge celebration. I love, love, love that many people were very, you know, embracing the lederhosen and the women were.
 
 Lei Xing (40:13)
 Yes.
 
 Tu Le (40:28)
 and the dirndls. And you appreciate those types of traditions. We're talking, I Googled it, 1810. They've been doing that since 1810 or something like that. And Munich is definitely one of my favorite European cities. ‚Åì Every time I've gone, it's been a really, really good time. We have a lot of friends there, obviously. And so...
 
 Lei Xing (40:41)
 ‚Åì
 
 You can have twice within one
 
 month. good for you.
 
 Tu Le (40:55)
 Yeah.
 
 So the second reason I was in Munich the second time in a month is because there was a small ‚Åì transportation leader summit in, I'm going to say this correctly, Tegernsee, which is about 30 miles outside of Munich. And thank you to NIO who let me borrow a car ‚Åì to drive down there. my wife, you know my wife.
 
 Lei Xing (41:05)
 conference.
 
 They can say it.
 
 You
 
 Tu Le (41:26)
 She kind of did her own thing during the conference, but it was such a beautiful, ‚Åì So, Tegernsee is a lake, and so it was at this lake. ‚Åì The hotel that we stayed at, resort hotel, is called Das Tegernsee, and that's what the conference is called. so, ‚Åì one of the things that ‚Åì came from the conference was ‚Åì
 
 Lei Xing (41:44)
 South Alta.
 
 Tu Le (41:55)
 McKinsey had said subsidies, because people still point to that Lei or a two to 5 % cost advantage. So it's nothing. The subsidies are nothing. So people need to stop. Yes. So people need to stop looking at that as a boogeyman. That didn't come from me. That came from, you know, a third, a third party, objected third party. So, ‚Åì just get, just get to work.
 
 Lei Xing (42:10)
 We're talking about the Chinese subcredit.
 
 Tu Le (42:25)
 legacy automakers, you know, and again, you and I, we have had multiple passport stamps this year going to China. Go visit, go rent a bunch of cars, go to Mexico, rent a bunch of cars.
 
 You know, decide for yourself. Don't rely on people on X. Don't rely on people on social media who haven't been there.
 
 If you know what I mean, like.
 
 Lei Xing (43:00)
 So the message I piggyback on you, I want to give is I recently did the investor trip with TechBuzz China where we visited five cities in one week and a bunch of companies. The simple thing for you to do is to really, like you said, come and see and talk to these people, experience, and then you get a sense of
 
 how they operate, what their culture is like, how they compete. And then a grain of salt, I tell every one of these investors, ‚Åì always a grain of salt of what they say, but at least what they say gives you a better perspective than what you hear on the news.
 
 That's the message, right? And then you can decide for yourself the good and the bad. And to be able to understand better, you know, right?
 
 Tu Le (43:59)
 I
 
 think that the message that I have, because I was on a panel in Michigan yesterday or two days ago talking about competitiveness and building globally competitive companies, because it doesn't matter now how China got there. The fact of the matter is the end product is great.
 
 The governments need to sort out the fairness part. The companies need to sort out building better products. If you want to continue to be globally competitive, right? So I don't want to wade into what the governments need to do from a policy standpoint. What I do know is that the United States currently does not allow Chinese, effectively doesn't allow Chinese EVs into the United States. That gives you time. What are you doing with that time? That's what I'm...
 
 really, really focused on. Okay. Are you crying and whining about the unfairness or are you back in the lab designing manufacturing or designing and engineering great products that you're going to launch in the next 12, 14 months? Now, GM and Ford has shown that they can do this through the Electra sub-brand, through the Bronco eRev, you know, Bev. So
 
 They're capable of doing this, but they need to export that ingenuity, that speed to their home markets. I'm jumping off my soapbox now, Lei.
 
 Lei Xing (45:37)
 Well, yeah,
 
 but the whole markets just don't have the involution that China has, unfortunately. Yeah. And so, and which, you know, we look at Tesla, what they did in Q2, right, a record high, but obviously there's the September push.
 
 Tu Le (45:48)
 Yeah, that is, so they need to be self-motivated effectively, right? Is what we're saying.
 
 Lei Xing (46:06)
 I'm not sure if you made your decision yet on a new car or EV. But I think even China, Tesla is slightly.
 
 resilient all this time. ‚Åì
 
 But we have to see what Q4 is like because now we've gone past that ‚Åì forward, This end of September, people are trying to buy an EV in the US to get the tax credit. How Q4 looks? Because last year, Q4 was also close to ‚Åì half a million. Is it going to be a huge drop off? We don't know, but. ‚Åì
 
 Tu Le (46:29)
 Surprisingly, surprisingly. ‚Åì
 
 Lei Xing (46:57)
 Yeah, China is still strong for Tesla. We haven't seen the numbers, know, it's a model YL. ‚Åì
 
 Tu Le (47:07)
 ‚Åì goodness.
 
 I hope not, Jeffrey. I hope not. ‚Åì Yeah, so ‚Åì first of all, I'm pretty much done. Let me look at the newsletter Lei Let's see. ‚Åì so we should also talk. So Berkshire Hathaway, Warren Buffett sold out of his position entirely of BYD.
 
 Lei Xing (47:28)
 Yeah.
 
 Yeah, we were
 
 Tu Le (47:42)
 What is that signal to you, Lei?
 
 Lei Xing (47:42)
 talking about them. That to me just means Warren Buffett is on the growth game. And I think he probably feels that this growth in the past, 17 years? We're not going to see that in the next 17 years. At least not the same growth. I think that's always been his play.
 
 that's my understanding. I don't look at it as ‚Åì a you know ‚Åì Buffett has exited all the shares in BYDs what's going on what's what's happening. I mean he's a growth
 
 Tu Le (48:24)
 He must be negative
 
 on BYD.
 
 Lei Xing (48:27)
 Yeah. So yeah, I don't, I think there's other issues that BYD has to deal with. Just the investment, right? I think they got, I don't know, 3800 % return or something. 4500, okay. And I think they move on, right? You invest and you buy, sell. And that was a good deal.
 
 Tu Le (48:44)
 4500.
 
 Lei Xing (48:57)
 That's all that is. Great deal.
 
 Tu Le (48:59)
 It was a great deal. hedge
 
 fund manager would die for those returns.
 
 Lei Xing (49:07)
 And that
 
 was Charlie Munger, right? Who pushed him into it, so.
 
 Tu Le (49:13)
 ‚Åì I'm... I'm...
 
 I don't know how or why Charlie knew to do this. It's amazing that he made such an early bet on BYD. Legends, that's why they're legends. And so ‚Åì I was interviewed by CNBC about that. And I said exactly that. I don't...
 
 See this as a concern that Buffett had about BYD just look at it like 17 years is a long time to be holding a position in the company. And with the 4500 % return, I think he was pretty satisfied. And to your point, you know, I also mentioned that moving forward BYD is actually going to have a lot of competition. And so there's not likely going to be, and if they do have a 4500
 
 Lei Xing (49:59)
 Yeah
 
 Tu Le (50:13)
 percent return. That's like game over for most automakers in the world in the next 15 years, isn't it? So ‚Åì anyways.
 
 Lei Xing (50:23)
 I
 
 Something to watch, I think like I said this year the landscape is pretty much set I think. But something to look forward to is whether BYD can come back stronger next year. Because guess what they're missing? They're missing the type of products that are eating into their market share. One great example is LeapMotor 120,000 RMB
 
 around that range with lidar. I think the C10 or the C11 ‚Åì into some of their ‚Åì BYD's compact ‚Åì vehicle sales. BYD is going to come back next year. ‚Åì I think we're most likely done from the growth that they've ‚Åì shown 21, 22, 23, 24.
 
 That's history. ‚Åì
 
 Tu Le (51:24)
 Well,
 
 if we drill down a little bit more, we've seen most of that growth in China. ‚Åì BYD ‚Åì hooked its wagon onto the growth of NEVs in China. now phase two is we're in a hundred markets. We continue to grow through our international expansion, through our manufacturing locally.
 
 Now, again, do we see 500,000 to four and a half million in a five year period, that type of growth? Probably not. It's actually going to slow, but we always knew that it was going to slow. And I'm a bit surprised that they're constrained.
 
 because I think their tool over the last few years was price cuts ‚Åì in China. so now that they're not able to use that as freely as they have been in the past, this is where you see the Geely Xingyuan and the Cherys ‚Åì really step up LeapMotor vehicles. one thing, so ‚Åì Augustin Friedel stopped by Detroit. He was at a conference in Ann Arbor and I hosted him at New Lab. You've been in New Lab.
 
 So we were talking, I actually think that 2026 is gonna get a bit more complicated for Chinese vehicles because to your point, this LIDAR, okay? How does that ship to Europe? Where's the data held? And is it able to go back to China or does it have to stay in Europe? These are the types of things now that we have more and more of these vehicles going to be exported.
 
 with these sensors, okay, that becomes likely, I won't say a hot button issue, but an issue that needs to be addressed ‚Åì as more more enter Latin America, Europe, and other parts of the world.
 
 Lei Xing (53:34)
 Yeah.
 
 Tu Le (53:37)
 I don't have anything else, we can go to, unless you do, we can go to questions and comments.
 
 Lei Xing (53:44)
 I mean, we can always talk forever, but time is constrained. It's too much to talk about, but we slice it up.
 
 Tu Le (53:49)
 ‚Åì So.
 
 So my man Riz,
 
 what's going on? ‚Åì Glad to have you guys join.
 
 Lei Xing (53:58)
 Yeah,
 
 I was talking with Riz a bit about, you know, his plan to go back to China and later, but.
 
 Tu Le (54:07)
 ‚Åì Jeffery writes, go Detroit for now. Wonder what your thoughts are about Jim Farley continuing conversations in China. EVs in the future afford with the tariff pounding.
 
 Lei Xing (54:17)
 He had another
 
 comment recently on China, right? Was that correct? About some of the things that we've been for. ‚Åì
 
 Tu Le (54:24)
 I think so, yeah.
 
 Jeffrey also writes, Elon is not interested in making cars anymore. It's obvious. Go NIO. ‚Åì He also writes.
 
 Lei Xing (54:37)
 Great to see you, Jeffrey. Have
 
 a good day.
 
 Tu Le (54:41)
 Li Auto f
 
 around and find out it's the original fake O O O or Audi right there. Right. So, and, and Jeffrey wants to remind you that Karen mock and NIO, Karen mock is an ambassador. Mike, the Car Guy writes.
 
 Lei Xing (55:00)
 Yeah, one of my favorite singers,
 
 my wife's favorite singers. Oh, by the way, it was great to kind of celebrate my birthday right after New Year's It happened. Yeah, that was a great experience. Everything. Oh, all right. Happy birthday edition of China EVs.
 
 Tu Le (55:08)
 How come almost
 
 ‚Åì yeah man, happy birthday dude!
 
 Yeah, I had a birthday too recently, we're getting old, we're getting old, And
 
 then shout out to Ethan Robertson, ‚Åì Wheels Boy, because he was getting interviewed and ‚Åì he basically said China EVs & More is one of the podcasts he listens to. So shout out to Ethan. Thanks for ‚Åì the plug. Mike the Car Geek, how come?
 
 Almost no vehicles in the US have a fridge. We invented drinking and eating in the car. ‚Åì I don't think people would leave the car, Mike, ‚Åì if they could have a fridge in it. I'm sure some of these large vans have fridges. I'm sure. ‚Åì yeah, the igloo, right? So ‚Åì Jeffrey writes, Canada's Mark Carney would be very smart. Yeah.
 
 Lei Xing (55:56)
 ‚Åì
 
 We, well, in the U.S., we have the igloo. We have the igloo.
 
 Just put it in the vehicle.
 
 Tu Le (56:15)
 ‚Åì Very smart to break away from taco, Trump's EV agenda and drop the tariffs and blocking China EVs. China speed. No one can match it. No one.
 
 Lei Xing (56:23)
 You know why? You know why? You
 
 know why the US don't have fridges in the cars? Because it's so easy to get ice everywhere.
 
 Tu Le (56:32)
 What is that?
 
 jeez. ‚Åì
 
 Lei Xing (56:37)
 Just going to a convenience store and buy a pack
 
 of ice and put it in the igloo.
 
 Tu Le (56:45)
 Yeah, we do have 7-Elevens all over the place, right?
 
 F1, F2, F3, and the one, and one day F4 coming for NIO. ‚Åì The Western narrative is running very thin on subsidies and over capacity on China EVs. If you're too lazy to go to China to see reality, then it's your fault. You're uninformed. You will not only be welcomed, but also be taken out to lunch. Let me see. Charlie was a legend.
 
 Imagine all the mooncakes he got over the years. I think Jeffrey's talking about Charlie Munger getting mooncakes.
 
 Lei Xing (57:19)
 by the way, I
 
 brought back ‚Åì quite a lot of mooncakes.
 
 Tu Le (57:27)
 Zhende man.
 
 So that's all I have. ‚Åì Jeffrey, thank you. ‚Åì And then he just wished me a happy birthday. So anyways, everyone, as always, and ‚Åì many apologies, Lei and I were getting some passport stamps, ‚Åì traveling a little bit. But we're back. And we will hopefully.
 
 be doing this almost every week and through the end of this year. appreciate your continued viewing and following us. Good morning, good afternoon, good evening. We will talk with you all next week.
 
 Lei Xing (58:11)
 Bye bye.