CHINA: EVs Start New Year With A Slump, BYD Hungary Factory and CATL 5C Battery | 02 Feb 2026

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With the SU-7 Ultra, welcome to EV News China, the podcast dedicated to the world's largest electric vehicle market.

Each day, I bring you the latest headlines, insights and analysis from the heart of China's booming EV industry

and decode how fast-moving developments in the East shape the global landscape.

We'll start with news of China's EVs starting the New Year with a bit of a slump.

Chinese car showrooms emptied out in January again, sharp month-on-month slumps.

Each new year have now become routine as year-end promotions fade,

policies roll over and subsidy deadlines pull demand forward.

The signal lies in the year-on-year figures, and they mostly show growth, if a little patchy.

Let's go around the grounds, so to speak.

NEO's story captured the contrast. NEO delivered 27,000 vehicles in January,

down 44% from December, but up 96% on January last year.

The all-new ES8 did the work, with 17,500 units delivered, or 65% of their volume.

Since its September launch last year, it's now sold 60,000 deliveries of the all-new ES8

in just 134 days, and tops December's SUV chart with 22,000 sales.

NEO also passed 1 million cumulative deliveries, so reasons to be cheerful.

Others stumbled, X-PENG's 20,000 units were down,

47% month-on-month and 34% year-on-year,

despite January updates to the P7+, the G6, G7 and G9,

and, of course, the X9, big MPV with its e-rev.

Policy shifts and the purchase tax rollback hurt everyone's demand.

Lee Auto's 27,500 deliveries dropped 37% month-on-month, 8% year-on-year.

The market now waits for an L-series facelift that swaps the steering interaction screen

for physical buttons and a smaller three-spoke wheel.

Most makers grew year-on-year, though.

Leap Motor is one of the success stories of last year, delivering 32,000 vehicles down from December,

but up 27% year-on-year.

It now needs to average about 88,000 units a month to hit its annual target of 1 million this year.

Zika sold 53,000 vehicles, 18% down on December,

but the Zika brand doubled its deliveries year-on-year.

Link and Co slipped a little.

Xiaomi delivered 39,000 vehicles, that's 22% fewer than December,

but 95% more than the same time last year as production shifted

from the now-closed Su7 order book, as they wait to refresh that, to the YU7, that's the SUV.

It offers seven-year low-interest finance across the YU7 line

until the 28th of February, with down payments of about 7,000 US dollars equivalent

and monthly payments of $360 delivery times, now 17 weeks for the YU7 standard

and the Pro, and 31 weeks for the Max.

So what about the elephant in the room, BYD?

BYD, the big one, began the year with a jolt.

The firm sold 210,000 new energy vehicles last month in January,

down 30% year-on-year and 50% down from December,

as China's car market hit the regular soft patch.

The drop matters because BYD is both China's largest NEV maker

and its second largest power battery producer.

Its slowdown shows how the end of generous support

exposes a fragile domestic market, even as Chinese brands push hard abroad.

The passenger new energy vehicles fell to 205,000,

that's 31% lower than a year earlier and 50% down on December.

Commercial EVs offered some scant relief, they were up, but only at 4,500.

Battery electric vehicle sales slid to 83,000 units,

that's 33% down on the year and 56% on the month.

Plug-in hybrids were down 30% on the year, down 45% from December.

10th straight month of annual decline for plug-in hybrids at BYD.

Policy shifts probably did the damage, as I mentioned,

buyers who once enjoyed a full waiver now face a 5% purchase tax.

Instead of exemption from the 10% rate,

trade-in subsidies in many cities expired at the end of the year

and fatigue was visible probably from November.

Beijing has since extended trade-in support with some tweaked terms,

leaving the market in a transitional phase rather than a freefall.

One of the few outright bright spots was abroad.

BYD exported over 100,000 NEVs in January, up 51% year-on-year.

Power battery and energy storage installations reached 20.1 gigawatt hours,

a 30% annual rise.

BYD still aims for 1.3 million overseas vehicles in 2026,

a growth rate of 24%.

BYD, of course, will start their production in Hungary,

very important to be building the vehicles in Europe.

Trial production will start at their new plant in Hungary

in the first quarter of this year,

with mass output to follow in the second quarter.

The 4 billion euro, or 4.4 billion dollar,

site is its first European passenger car factory,

separate from the EV bus plant they opened 10 years ago.

At full tilt, the factory can build 300,000 vehicles a year,

though BYD plans to start at only 150,000.

That's still a huge number.

Hungary's become a manufacturing hub

for both European and Chinese car makers.

BYD will use the factory as an assembly and export base

for the wider EU market.

Local production lets the firm dodge EU tariffs,

as Chinese built electric vehicles but made in the EU

mean that they can sharpen their prices without tariffs.

Early output will focus on the small cheap models.

The first cars will be the Dolphin Surf.

In China, that's the Seagull and the Atto-2,

the small SUV, in both EV and plug-in form.

As volumes build, the plant will add the Atto-3,

the Dolphin, the Seal and the Seal-U,

giving BYD a broad lineup to take on the likes of VW

and Stellantis on home soil.

This is a huge story next.

CATL, the world's biggest EV battery maker,

says that its latest 5C,

C-rate is a multiplier,

a measure of how fast a battery can charge or discharge.

2.5C is very good.

5C is largely exceptional.

There are faster.

Ultra-fast charging.

This story, though, is about longevity.

It will keep 80% of its battery

after 3,000 full charge-discharge cycles

in a video published on January 29th.

CATL said, under conditions,

ideal conditions equating to a theoretical driving distance

of 1.8 million kilometres,

or 1.1 million miles,

their 5C ultra-fast charging battery

has still got 80% left.

This is about six times the current industry average

for commercial lithium-ion cells after a million miles

and may exceed the lifespan of,

well, frankly, the vehicles that they're in.

It also lifts performance well beyond most cells

now on sale in China.

The cell sits in the ultra-fast segment.

5C is a 12-minute 80% charge.

CATL says the gains are not limited to the lab

at 60 degrees Celsius.

So that would be maybe a car exported

to somewhere like Dubai

in the summer temperatures.

And not far from what packs can face

in parts of Western China, to be honest.

Or even on congested urban roads when it's hot.

The battery holds 80% of its charge

and 80% of its capacity in extreme heat

after 1,400 cycles.

That's still 522,000 miles,

or almost a million kilometres.

The company credits the tweaks they've made.

A denser, more uniform cathode coating,

which slows structural degradation

and cuts metal ion loss

during the ultra-high charge speeds.

A proprietary repair additive in the electrolyte

seeks out and then seals any microcracks

while reducing irreversible lithium loss.

And a temperature-responsive coating

on the separator surface slows ion migration

when local temperatures rise,

which gives a self-regulating break

on thermal runaway.

An upgraded battery management system

rounds out the whole approach,

steering coolant to the hot spots where it needs to.

OK, let's talk about China's

next wave of EV charging.

China ended last year with 20 million

EV charging facilities, the largest network in the world,

and up 50% on 2024.

And yet their build-out has really only just begun.

The National Energy Administration

wants roughly 8 million more charging facilities

by the end of 2027,

taking the total to 28 million.

The plan would lift public charging capacity

to over 300 million kilowatts

meant to serve for more than 80 million electric vehicles.

Urban areas are due.

1.6 million extra DC connectors,

including 100,000 high-powered units.

Highway service areas and rest stops

will get 40,000 new

and upgraded ultra-fast connectors.

The push tries to keep pace with a market

that has flipped in five years.

New Energy Vehicle Penetration in China's

car industry jumped from 5.4%

before the pandemic to 54%

last year, and towards the end of the year

on the monthly figures,

EVs were over 60%

Output surged from 1.3 million units

in the same time frame to 16 million

over the same period.

Petrol-powered passenger cars have been sliding

in China and the supply

has had to match the surge,

frankly, with public charging infrastructure

now standing at 4.7 million facilities

in public charging.

Private charging is 15 million,

and that gets you to your 20 million charge points.

The state also leans into grid integration,

which is going to be huge.

Now, let's talk about China's petrol cars.

In a structural retreat,

China's petrol market has shed

7 million units in six years.

Internal combustion engine sales fell

from almost 18 million units a year

in 2020 to 10.85 million last year.

That is a 39% contraction

that would count as a crisis in any other car market.

The slump does not signal a weak market,

but a flip-in demand.

By December last year,

New Energy Vehicle Penetration

59-60% on the monthly figures

turning what was once a growth engine

for global car makers into a shrinking niche.

Don't get me wrong, there's plenty of petrol cars

you can still buy in China.

You'll just be on the wrong side of the adoption curve

as EVs push deeper into every price band,

high and low, frankly, in every segment in China.

They're redrawing the economics of joint ventures,

supply chains and product planning.

The damage has not only fallen

across the Chinese car industry,

but it hasn't really landed evenly.

Joint venture brands with western car makers

are really where it's hit the worst.

The remaining leaders came from the big domestic names

which held onto volume as they've pivoted to EV quicker.

Now, we've got this big story about Ford

and Xiaomi working together,

or maybe not, we'll take a break back in a sec.

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The discussions included a joint venture

to make EVs on US soil.

This is a very delicate issue

as Ford wants to build batteries on US soil

but licensing CATL's technology for LFP.

Many Republican American lawmakers

are really pushing back on using Chinese IP.

So very delicate situation.

Not sure when these negotiations happened

what's inferred it was some time ago.

It would mark a sharp turn

in car ties between China and America.

Since 2024, Washington imposed

100% tariffs on Chinese cars

and in effect shutting them out.

A Ford, Xiaomi joint venture

would be a workaround.

Chinese software, Chinese supply chains,

Chinese cost discipline

but ultimately, Ford's built in a factory

owned by America with Ford workers.

So is it a Ford or a Xiaomi?

It would also inflame the politics.

The Republicans on the House China committee

already warning Ford

that it's turning its back on America

if it does a deal to license Chinese IP

to make LFP packs.

Ford has not only spoken to Xiaomi

according to the Financial Times,

it's held talks with BYD

and others about a possible US deal.

Yet Xiaomi's the one that stands out to me

at the car market in 2021

and then he launched their SU-7

less than two years ago.

I mean, it's five minutes, a blink of an eye

in the car world

and yet they've taken market share

from Tesla, in fact the SU-7

now bigger than Tesla in China

and bigger than the Model 3

delivering 135,000 vehicles in its first year

and then 411,000 last year

this year, 550,000 is the target.

The two firms immediately

and flatly have denied

the Financial Times report.

Xiaomi called the claim

with negotiations with Ford false

and said it had not held discussions,

the Chinese tech group also stressed

that it doesn't currently sell its products

or services in America.

An important point at a time when

Washington circles Chinese car makers

with tariffs. Ford didn't mince their words

describing the story as

quote, completely untrue

and without factual basis.

According to this Reuters report

the rebuff matters because

the FD had cited four people

very familiar with the negotiations

who said Ford had had preliminary talks

about a possible cooperation.

That'll rumble on.

Now, NIO has joined China's

latest car financing drive

with seven years low interest

as the EV market slips and its usual

year end slash new year

lull the offer targets

price sensitive buyers

without cutting the list of prices

which would inflame Beijing somewhat.

Keep the prices high

find other ways to get buyers buying

and that seven years at zero

or low interest rate.

The scheme covers the

double five, double six models.

So in other words, 85

85 touring

ES6, EC6

so double five, double six

and some cheaper envos as well

like the L-60 and L-90

buyers of these NIOs and envos

must put down at least 20%

and then pay 0.49%

that's a tiny amount.

Now the E-T5 and E-T5 touring

are the cheapest cars from NIO

starting at $41,600

US equivalent including

buying the battery.

ES6 starts at

$47,000, EC6

50 but of course NIO

leans into its battery as a service

rental scheme so you can get 15 grand off

if you lease the battery

back to sweeten the deal

customers who buy any of the four NIO models

by the end of February get five years

of free navigation on autopilot

and 48 complimentary

battery swaps that would do me

for pretty much the life of owning the vehicle

unless you really do travel a lot

now let's finish

off by talking about Xiaomi once again

and this time a problem that they can't

seem to fix. Xiaomi sold

3,100

of their Su7 Ultras

back in March last year

and yet by December

it had gone down to 45

it was a halo model meant to crown the firm's

move into EVs

not so much a slowdown

a total stall

the Su7 Ultra was launched almost a year ago

actually 27th of February last year

at $75,000

Xiaomi pitched it as

its flagship, high-tech, triple-motor

1500 horsepower

less than two seconds, 0-60

it's a beast. In China's

crowded premium EV

market that turned heads

at first the strategy worked from March

to August monthly volumes

between 2,000 and 3,000 cumulative sales

went up past 10,000

enough for the boss, Lei Jun

to claim that he had met his target on the vehicle

about 7,000 of the cars

that went in the first six months

and then it started to slow down

the numbers buckled, sales slid

488 in September

130 October, 18 November

and then 45 in December

for a fresh

high-performance variant less than a year old

that's harsh

the car picked up a lot of baggage

critics accused Xiaomi of false advertising

buyers complained about

having to pay up in advance

reports emerged of doors that didn't open

accidents of upgrades

that were meant to improve the aero flow

and then when they looked at the bonnet

it was exactly the same as the cheaper version

in a market where rivals launched

new models at high speed and social media

can kill products

in days

these stories inflicted

pain on paper the su7

ultra met its early volume

goal in practice

a halo EV that can hit

350 kilometers an hour

now struggles to get past 45

units a month

that's your podcast for today thanks for listening

I'll see you when I'm better tomorrow

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CHINA: EVs Start New Year With A Slump, BYD Hungary Factory and CATL 5C Battery | 02 Feb 2026

About this episode

EV industry

subsidy deadlines

NEO

Nio ES8

EU tariffs

BYD Dolphin Surf

BYD Seagull

BYD Atto-2

BYD Atto-3

BYD Seal-U

Byd Seal

Volkswagen (VW)

Stellantis

CATL

C-rate

ultra-fast charging

thermal runaway

battery management system

EV charging facilities

Ford

Xiaomi

Tesla Model 3

car financing

EV market

battery as a service

horsepower

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