China’s most outrageous new hypercar has already brushed up against the outer limits of physics, and now it has handed the keys to Richard Hammond. Last year, the YangWang U9 Xtreme went faster than any production car before it, recording a one-way top speed of 308.4 mph or 496.22 km/h at the ATP Papenburg high-speed oval in Germany.

Because the run was completed in only one direction, however, SSC’s Tuatara technically still retains the official two-way average production car record at 282.9 mph (455.3 km/h).

Even so, it was a headline-grabbing run that instantly placed BYD’s halo car in rare company. Keen to showcase that achievement to a broader audience, BYD recently invited Richard Hammond to become the first Western journalist to drive the car. The result makes for compelling viewing.

Read: China’s YangWang U9 Smashed Bugatti’s Speed Record But Still Isn’t Officially The World’s Fastest Car

As Hammond admits in his latest DriveTribe video, he doesn’t exactly have the greatest reputation when it comes to driving extremely fast, ultra-powerful cars. In 2017, he crashed the all-electric 1,224 hp Rimac Concept One while filming The Grand Tour. Back in 2006, he was seriously injured after crashing a dragster on the set of Top Gear.

BYD obviously put a lot of faith in him to keep the U9 Xtreme in one piece, particularly given that this four-motor electric beast delivers a maximum of 2,978 hp, more than any other production car.

Rather than driving it on the road, Hammond was able to put it through its paces on a racetrack. Understandably, he appears to take things quite easily, which is hardly a surprise given that a BYD test driver spun up the car’s wheels the day prior and crashed into a barrier. It would seem as though having almost 3,000 hp under your right foot requires a lot of care. Who would have thought?

Hammond Tests Xiaomi Too

Interestingly, this isn’t the only recent video that Hammond has made in China. Late last year, he joined what could best be described as the Chinese version of Top Gear, alongside three hosts for a road trip. In this video, he drove three of China’s most impressive new EVs: the Xiaomi SU7 Ultra, the ‘regular’ YangWang U9, and the luxurious Maextro S800.

The clip was originally shared only on Chinese social media but has since been translated and uploaded to YouTube for our viewing pleasure. It’s well worth a watch.

Screenshot Drivetribe/YouTube

Europe’s new car market didn’t exactly start the 2026 race in a flurry of smokey wheelspins. Registrations across the EU, UK, and EFTA slipped 3.5 percent year-on-year to 961,382 units in January. But beneath that soggy headline number, one brand was busy throwing its own party.

And it wasn’t Tesla. Across the EU, UK, and European Free Trade Association (EFTA) regions combined, Tesla registrations dropped 17.0 percent to 8,075 cars in January. That left the American EV giant with a 0.8 percent market share, down from 1.0 percent a year earlier, according to data from industry body ACEA.

It was also Tesla’s 13th consecutive month of declining sales in Europe, a reminder that this is no short-lived dip.

Also: Tesla’s Sales Collapsed By Nearly 90% In The Land Of EVs

BYD, meanwhile, went into overdrive with its mix of EVs and hybrids. The Chinese brand shifted 18,242 cars across the same region, an impressive increase of 165.0 percent year-on-year (175 percent in the EU alone), and its share climbed to 1.9 percent, more than double Tesla’s slice of the pie.

Dacia’s Fall From Glory

Tesla was far from the only automaker to take a beating in January. Renault Group also had a bruising month, its sales falling 15.0 percent to 83,201 units. That is a slide not too far off Tesla’s in percentage terms, though the Renault brand itself was up 4.4 percent. It was Renault-owned Dacia’s disastrous 35 percent drop that ruined the overall picture.

BMW (down 8.7 percent) and the VW brand (down 11.2 percent) were also left licking their wounds, while sister companies Mini (up 11.2 percent) and Skoda (up 10.1 percent) gleefully rubbed salt in them.

One In Five Cars Now An EV

On the powertrain front, the shift to electrification keeps gathering pace. Sales of battery electric cars climbed 13.9 percent, meaning they now account for 19.3 percent of the EU market in January, up from 14.9 percent a year earlier. And plug-in hybrids climbed 32.2 percent while petrol registrations plunged 25.7 percent and diesel slid 22.0 percent.

Country by country, the picture was mixed. Germany and France both saw total registrations fall 6.6 percent, but their EV registrations jumped by 23.8 and 52.1 percent, respectively. And Norway, always an EV bellwether, endured a dramatic 76.3 percent drop in overall registrations, mostly due to the end of government incentives.

European Car Sales

ACEA: Figures for EU + UK + EFTA

January tested the resilience of China’s auto market, exposing fault lines for some brands while spotlighting the rare breakout success. Many domestic manufacturers reported sales declines, with BYD among the most notable names to feel the squeeze. Yet even in a cooling climate, certain models found remarkable momentum. None more so than the Xiaomi YU7.

The all electric SUV, positioned as a rival to the Tesla Model Y and styled with more than a passing resemblance to the Ferrari Purosangue, was the best-selling new vehicle in China last month.

Read: This Ferrari SUV Lookalike From China Makes More Power Than The Real One

According to figures shared by Autohome, it moved 37,869 units, comfortably ahead of the Geely Boyue L in second place with 34,176 sales. The Geely Geome Xingyuan followed with 29,007, while the Aito M7 secured fourth with 26,454 units.

The presence of two Geely models in the top 5 best-sellers reflects a strong month for the group, with sales up 1 percent year-on-year to more than 270,000 units. The M7 from Aito, backed by Huawei and Seres, also surged in popularity, as did other models from the brand, helping it deliver more than 40,000 vehicles, a surge of over 80 percent from January 2025.

Sales of the YU7 in China have remained strong in recent months. December saw 39,089 units sold, making it the third best selling new car in China at the time. That figure represented a clear rise from November’s 33,729 and October’s 33,662.

It has also moved decisively ahead of the Tesla Model Y, selling more than twice as many units. The Model Y ranked only 20th last month, with 16,845 sales, a result that would have seemed unlikely not long ago. In fact, it was China’s best-selling model in December.

Familiar Names Climb The Charts

Perhaps the biggest surprises came from Volkswagen. It ranked fifth in China’s top 20 best-selling cars last month, led by the Sagitar with 25,316 units sold. VW also sold 23,481 Lavidas, 21,330 Tiguan Ls, 20,799 Passats, and 19,306 Magotans. In addition, the Nissan Slyphy sold 24,209 units, indicating that not all hope is lost for legacy carmakers in the country.

Things weren’t so rosy for BYD. It sold 205,518 vehicles in China last month across its brands, a significant decline from the 300,538 in January 2025. Only one of its models entered the top 20, the Fang Cheng Bao Ti7, which ranked 18th with 17,116 units sold.

China New Car Retail Sales January 2026

Sources: Autohome, Carnewschina

Chinese juggernaut BYD has expanded rapidly across global markets in a remarkably short time, positioning itself as one of the world’s largest car manufacturers. Yet despite its international reach, it has so far been unable to enter the world’s second-largest new car market: the United States. The main obstacle has been import tariffs, but BYD is now pushing back.

Eager to establish a foothold in the US market with its passenger vehicles, four BYD subsidiaries based in the United States have filed suit against the federal government.

Read: China’s EV Boom Is Cooling, And The Big Names Are Feeling It

The case, brought before the US Court of International Trade, challenges tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The plaintiffs include BYD America LLC, BYD Coach & Bus LLC, BYD Energy LLC, and BYD Motors LLC.

The lawsuit names not only the federal government but also officials from the Department of Homeland Security, Customs and Border Protection, the Office of the US Trade Representative, and the Treasury Department.

It argues that these agencies exceeded the authority granted to them under the IEEPA statute and contends that the resulting tariff orders are legally invalid.

Tariffs Under Fire

In addition, the lawsuit specifically challenges nine executive orders and amendments issued since February 2025, including tariffs at the borders with Mexico and Canada, as well as tariffs targeting China and related to fentanyl.

The Chinese car manufacturer is seeking permanent injunctions against these measures and wants refunds for all IEEPA tariffs collected, in addition to interest and reasonable litigation costs.

While it may sound like a long shot for BYD to try and get these tariffs overthrown, its efforts aren’t without precedent. The lawsuit cites the case of New York-based wine importer V.O.S. Selections, which successfully sued the US government over tariffs, arguing that the US President lacks authority to impose them, even under the IEEPA framework.

Already On American Soil

Though it may surprise many American consumers, BYD already maintains a manufacturing presence in the United States. Its 550,000 square-foot facility in Lancaster, California, produces hundreds of electric buses and employs roughly 500 workers.

Getting the tariffs thrown out wouldn’t just help this complex, but also open the door for BYD to sell cars in the United States, perhaps importing them from factories in Canada and Mexico.

Could This Open the Floodgates?

Sun Xiaohong, secretary-general of the automotive branch of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, told Global Times that “BYD’s move follows a growing trend of companies using legal channels to safeguard their legitimate rights and interests.”

While the case still faces legal hurdles, Sun told the outlet that it could set an important precedent for other Chinese companies looking to assert their rights through formal channels. He also argues that letting automakers like BYD in could benefit US buyers by adding more affordable EV options to a market that’s only getting more competitive.

Demand for electric cars in China may be cooling, and some of the country’s biggest automakers are starting to feel the chill. Several of the most prominent domestic brands, including BYD, Xpeng, and Xiaomi, reported noticeable drops in January sales.

Data shows that BYD sold 205,518 vehicles in China last month. The number sounds solid on its own, but it marks a sharp decline from the 300,538 vehicles the company moved in January 2025.

Read: A $9,500 Hatch Stole Tesla’s Best-Seller Crown In China

Both BYD’s electric vehicles and plug-in hybrids were affected. Of the 205,518 vehicles sold last month, 83,249 were EVs and 122,269 were PHEVs. A year earlier, those numbers stood at 125,377 and 171,069 respectively. Exports took a hit too, dropping to 100,482 units in January from 133,172 in December.

Is Government Policy Slowing Sales?

These figures suggest weakening demand in China and possibly overproduction for overseas markets, but a recent government policy change may go some way to explaining the drop. As of January 1, the country reinstated a 5 percent purchase tax for new energy vehicles, having previously exempted them from a 10 percent tax for more than a decade, CNBC reports.

“We see increasing pressure on China’s auto market in 2026, driven by a combination of policy and competitive factors,” Helen Liu, partner at Bain & Company, told CNBC. She added that recent tax changes may prompt some consumers to delay purchases, while automakers hold back on new model launches.

“We know [EV sales will] slow, we just don’t know by how much,” added Tu Le, founder of Sino Auto Insights. “We’ll know much better after the first quarter is over.”

Rough Starts And Reversals

Xiaomi also struggled out of the gate. It sold 39,000 cars in January, which was an improvement over the same time last year, but a steep drop from the more than 50,000 EVs delivered in December. Xpeng’s January was even rougher. Sales fell 34.1 percent year-on-year to 20,011 units, and the month-on-month drop was starker still at 46 percent compared to December 2025.

Li Auto’s performance dipped as well, with deliveries slipping to 27,668 units for the month.

Competitors Capitalize

However, it’s not all bad news. One of the few bright spots was Aito, a newer brand backed by Huawei’s operating system, which reported more than 40,000 deliveries in January, marking a gain of more than 80 percent compared to the same month last year.

Sales at Leapmotor rose to 32,059, while Nio also reported an increase to 27,182 units. Geely sold more than 270,000 cars in January, a 1 percent increase year-on-year. Interestingly, its EV sales fell by 15 percent, while its PHEV sales rose 37 percent.

That performance has pushed Geely into second place in the country’s EV market behind BYD, thanks in part to strong momentum from its Galaxy and Zeekr brands.

Will China Step In?

The slowdown has fueled speculation that Beijing may step in once again. If the slump continues into the first quarter, analysts believe the government could reinstate certain subsidies or incentives

A new electric subcompact has pulled off a quiet revolution in China’s fiercely competitive car market, topping the charts without the backing of Tesla or BYD. The Geely Galaxy Xingyuan, a fully electric hatchback, has officially become the country’s best-selling vehicle for 2025, racking up 465,775 registrations and ending the two-year reign of the Tesla Model Y.

More: Ford Held The Best-Seller Crown, But GM Outsold It On A Technicality

Known as the Geely EX2 in export markets, the Galaxy Xingyuan was introduced in 2024 and measures 4,135 mm (162.8 inches) in length. It sits in the subcompact category, going up against popular rivals like the BYD Dolphin, Wuling Bingo, and Aion UT.

It blends simple, approachable styling with a well-equipped interior and pricing that stays competitive, currently ranging from ¥65,800 to ¥95,800 ($9,500 to $13,800 at current exchange rates) in China.

GM JV Snags Second Spot

China’s second-best-selling vehicle in 2025 was the compact Wuling Hongguang Mini EV, repeating the success of its earlier version from 2021 and 2022. The pint-sized electric hatchback from the SAIC-GM-Wuling joint venture entered a new generation last year, bringing more playful styling and a new five-door variant. Those updates clearly landed well, helping it reach 435,599 units sold, a huge 82 percent jump over its 2024 total.

Geely Galaxy Xingyuan

The Tesla Model Y, which held the top spot in 2023 and 2024, slipped to third place in 2025. It still put up strong numbers with 425,337 units sold, though that marked an 11.5 percent decline from the year before, even with the launch of a significantly updated version earlier in the year.

More: One in 10 New Cars Sold in Europe Last Month Was Chinese

In fourth place, the BYD Qin Plus sedan registered 387,315 units sold. Available as either a fully electric model or a plug-in hybrid, the Qin Plus had previously held the second spot in both 2023 and 2024 but saw its position slip this year.

The Nissan Sylphy sedan, known as the Sentra in the US, was China’s best-selling model from 2020 to 2022 before Tesla took over. Now down to fifth place with 320,000 sales, it still holds the distinction of being the country’s best-selling non-EV. A new generation has just arrived, which might give it a boost heading into next year.

Source: China Passenger Car Association (CPCA)

Another standout in China’s top 10 for 2025 is the Xiaomi SU7 sedan, which landed in eighth place with 258,164 units sold. The Chinese newcomer made headlines by outselling its direct rival, the Tesla Model 3, which slipped to eleventh with 200,361.

Local Brands Dominate The Charts

According to data from the China Passenger Car Association (CPCA), BYD held onto its lead as the largest manufacturer in China by total volume, selling 3,484,525 vehicles in 2025. Geely followed in second with 2,605,565 units, marking a striking 47% increase over the previous year.

Chinese brands as a whole captured 65 percent of the domestic market, while many foreign automakers that once dominated have struggled to keep up. FAW-Volkswagen secured third place with 1,531,276 sales, but joint ventures from Toyota and Honda have now dropped out of the top five.

Source: China Passenger Car Association (CPCA)

BYD has quickly become one of the most significant forces in the global auto industry’s post-Covid transformation, expanding its reach at speed and establishing itself as a dominant player in both EV and PHEV segments. Its rise has been rapid, but not without friction, especially in countries where shifting electrification policies continue to create uncertainty.

Speaking at the World Economic Forum in Davos, Switzerland, BYD executive vice president Stella Li called out the complications these changing policies create for manufacturers.

Read: The EU Blinked And Gas Cars Live To See Another Generation

In her view, the constant shifts make it difficult for companies like BYD to commit capital or build out reliable supply chains. The result, she said, is a climate that “will confuse manufacturers.”

Can Carmakers Keep Up?

“The back and forth policies at the national level have made it more difficult for industry to throw all in and ramp up the way that some of the Chinese companies have been able to,” she revealed, during a panel discussion.

When governments draw a “very clear line” and stick to it, automakers can plan more confidently, Li said. She added that stable direction helps them execute consistently and align their production timelines with long-term goals, according to a report from Business Insider.

The contrast between the Biden and Trump administrations highlights just how disruptive these swings can be. While BYD hasn’t felt the effects of U.S. policy, the European Union’s recent decision to scale back its proposed 2035 ban on internal combustion engine vehicles could potentially impact the company’s future strategy in the region.

China Leads EVs

Li pointed out that China continues to lead the global EV sector. She credited the country’s expansive charging infrastructure, fast-moving technology, and high consumer demand as key factors driving adoption.

Elaine Buckberg, former chief economist at General Motors, echoed the need for regulatory stability during the panel discussion. She emphasized that predictable incentives play a central role in supporting long-term investment.

“Keeping those incentives stable, that’s really powerful,” she said. “That’s a place where the US is really pulling back under the Trump administration.”

Ford may be pulling back on its EV spending, but it isn’t walking away from electrification. Instead, the company may be taking a different approach, and that path could lead through China. Specifically, Ford is reportedly in early talks with BYD, the Chinese automaker that recently overtook Tesla as the world’s top EV producer, to source batteries for its next hybrid models.

According to a report from the Wall Street Journal citing sources familiar with the discussions, nothing is finalized, and a deal may not materialize. But if it does, one idea under consideration is for Ford to begin importing BYD batteries for use in its factories outside the United States.

Read: Hold Your Horses, Ford Might Be Working On A Hybrid Pony Car

In response to the report, Ford didn’t confirm or deny the potential partnership. “We talk to lots of companies about many things,” the company told the newspaper. That kind of non-denial tends to say a lot without saying much at all.

BYD, while primarily known for its battery manufacturing in China, has been expanding its footprint globally, building production capacity in Brazil, Europe, and Southeast Asia.

Why BYD Might Be the Answer

The timing of these talks aligns with a major pivot inside Ford. The company recently took a $19.5 billion write-down after scaling back several electric vehicle initiatives, including high-profile battery joint ventures with South Korean firms SK On and LG Energy Solution. Alongside a renewed emphasis on internal combustion models, Ford plans to grow its hybrid lineup, an area where BYD already excels.

The Chinese company is one of the world’s largest producers of hybrid vehicles and battery packs for cars. Instead of launching new factories or reviving shelved partnerships, Ford might simply buy batteries directly, streamlining its supply chain as it targets a goal of having hybrids, plug-in hybrids, and EVs make up half of its global sales by 2030.

Will Washington Push Back on a BYD Deal?

Any such deal is unlikely to go over well with the Trump administration. Shortly after reports surfaced that Ford was speaking with BYD, top Trump trade advisor Peter Navarro hit out at the plan.

“So Ford wants to simultaneously prop up a Chinese competitor’s supply chain and make it more vulnerable to that same supply chain extortion?,” he wrote on X. “What could go wrong here?”

Meanwhile, Donald Trump took a different tack. Speaking to reporters in Detroit, the president said he welcomed foreign firms, including those from China and Japan, setting up shop in the States, as long as they employed American workers.

“You know, those tariffs are keeping the foreign autoworkers. Now, if they want to come in and build the plant and hire you and hire your friends and your neighbors, that’s great. I love that,” said Trump. ” Let China come in. Let Japan come in. They are. And they’ll be building plants, but they’re using our labor.