BEIJING — Chinese electric car company Nio is trying to raise the bar for premium vehicles in a fiercely competitive market.

Shares of Chinese electric carmaker Nio jumped as much as 10.45% in Hong Kong trading on Thursday after the company officially launched its ES9 SUV a day earlier. Its U.S.-listed stock closed 9.32% higher overnight, extending gains for 2026.

The ES9 starts at 390,000 yuan ($57,470) under Nio’s battery subscription model, which separates the cost of the vehicle from monthly battery payments.

It reflects the ongoing race to the bottom in China’s electric car market, despite Beijing’s efforts to curb excessive competition, often called involution. Sales of new energy vehicles for the first four months of the year have dropped by 17% in China, according to the country’s passenger car association.

The Chinese car market has already passed its years of fastest growth as most potential car buyers have already purchased one, Nio CEO William Li told reporters Thursday.

As technological features converge across EV models, Li said brand and targeted premiumization will be key to survival.

When Nio launched its flagship ET9 sedan in late 2023, prices started at 800,000 yuan. But before deliveries started in the first quarter of 2025, consumer electronics company Xiaomi had launched its first electric car — at 215,900 yuan.

With the new ES9, which Nio claims is the largest SUV in China, deliveries start Thursday.

CEO Li showed off an array of features at a launch event in Beijing, from advanced driver-assist systems that can respond to road signs to passenger seats with wood-colored tables that unfold similarly to those on an airplane. The ES9 also supports an in-car water boiler that lets passengers brew tea.

Nio signed on several brand promoters, including Robin Zeng, the CEO of CATL, the industry’s battery giant, who affirmed in a marketing video that about 2,000 of his employees had bought Nio cars.

Li also emphasized how the ES9 proactively protects passengers with “smart safety” systems that can detect and minimize impact from dangerous scenarios, and got China’s state broadcaster CCTV to livestream a crash test and other safety features.

Nio delivered 83,465 cars in the first quarter, nearly twice as many as a year ago, but a 33% drop from the fourth quarter. The figure also includes vehicles from Nio’s lower-priced brands Onvo and Firefly, which the company launched in the last two years to remain competitive in China’s sluggish consumer market.

Tesla‘s Model Y was the top-selling SUV in China last month by deliveries, according to industry data site China AutoHome. Elon Musk’s automaker last week received Beijing’s approval to launch driver assist in the country after years of waiting.

Nio’s ES8 ranked 10th in April deliveries across both electric and traditional gasoline-powered cars.

Foreign automakers are also revamping competition in China’s premium market at lower prices.

Audi on May 8 started presales for its E7X electric SUV with prices starting at 289,800 yuan, and is set to officially launch the car Friday morning. The car is the second model under the German automaker’s new China-focused brand, co-developed with Shanghai’s SAIC, that replaces the four-rings logo with the AUDI letters.

Like BYD and other Chinese automakers, Nio has pursued overseas expansion. But Li said Thursday that the automaker decided last year to shift its focus back to China.

He cited geopolitical tensions, including EU tariffs and the Russia-Ukraine war, as well as the far higher cost of investing in battery services overseas relative to China. Nio has largely focused much of its overseas expansion on Germany and Norway.

Underscoring Nio’s renewed domestic focus, Li said that the far-western Chinese region of Xinjiang represents a market twice the size of Norway’s

As the leaders of the world’s two most powerful economies rekindled personal ties in Beijing on Thursday and Friday, with a cavalcade of American business leaders accompanying U.S. President Donald Trump, the Chinese capital turned into something of a spectacle.

The visit — the first by a sitting U.S. president to China in nearly a decade — was full of friendly overtures, closely orchestrated pageantry, business dealmaking, and headline-grabbing sideshows that captivated audiences on both sides of the Pacific.

Beijing deployed its diplomatic arsenal to the full.

It laid on brass bands and flower-waving schoolchildren at the airport, a state banquet at the Great Hall of the People, a private tour of the Temple of Heaven, and a closing garden stroll at Zhongnanhai – the walled compound where China’s top leaders have worked and lived since 1949 – during which Chinese President Xi Jinping offered Trump rose seeds as a parting gift. 

“There were unusually long handshakes, back-patting, smiling, and synchronized walking during public appearances,” said Lyle Morris, senior fellow for foreign policy and national security at the Asia Society Policy Institute. “The interaction was warmer and more relaxed than some previous Trump-Xi encounters,” Morris said. 

Crowds gathered along streets near the Four Seasons hotel and the Great Hall for a glimpse of Trump’s motorcade. “It was quite a spectacle,” said Alicia Liao, a university student in Beijing. “We had an exam the next day, but almost everyone followed the broadcast or social media clips.”  

Tesla posted its fourth-quarter 2025 vehicle production and deliveries report on Friday, marking a second annual decline for Elon Musk’s automaker. Shares closed 2.59% lower on the day.

Here are the key numbers:

• Total Q4 deliveries: 418,227
• Total Q4 production: 434,358
• Total 2025 deliveries: 1.64 million
• Total 2025 production: 1.65 million

Wall Street expected 426,000 deliveries for the quarter, according to estimates compiled by StreetAccount.

In a company-compiled consensus posted to its website on Dec. 29, Tesla said analysts it surveyed were expecting a 15% drop from a year earlier to 422,850 vehicles.

Deliveries for Q4 2025 were about 16% lower than the fourth quarter of 2024, when Musk’s EV company reported 495,570. Q4 2025 numbers for production were down 5.5% from a year ago, when Tesla produced 459,445 vehicles.

For the full year, Tesla’s deliveries fell 8.6% to 1.64 million from 1.79 million in 2024.

Tesla said deliveries of its entry-level Model 3 sedan and Model Y SUV amounted to 406,585 in the fourth quarter, or about 97% of total deliveries. Deliveries of its Model S, Model X and Cybertruck vehicles came in at 11,642 during the quarter.

After its design debut, Tesla boasted about more than 1 million reservations flooding in for the Cybertruck. The angular, steel pickup has yet to be a best seller for the company.

Musk’s aerospace and defense company, SpaceX, reportedly purchased tens of millions of dollars worth of Cybertrucks in 2025.

Tesla faces heightened competition in the electric vehicle market from China’s BYD, South Korea’s Kia and Hyundai, and Volkswagen in Europe, among others.

BYD topped Tesla as the world’s biggest seller of EVs in a calendar year, saying in a statement Thursday that sales grew 28% to 2.26 million units.

Deliveries are the closest approximation of sales reported by Tesla, but are not precisely defined in the company’s shareholder communications.

In its energy business, Tesla said that it deployed 14.2 gigawatt hours of battery energy storage products in the fourth quarter, following a record in the prior period, when it deployed 12.5 GWh.

Tesla’s battery energy storage systems include backup batteries for homes and larger systems used alongside data centers and utilities.

Tesla will report its fourth-quarter financial results on Jan. 28.

Sales of Tesla’s cars were impacted by President Donald Trump’s decision to end a federal EV incentive by Sept. 30, earlier than previously planned. The expiration pulled some EV sales forward to the third quarter for Tesla and other automakers.

Even before that, the start of 2025 was a struggle for Tesla.

After spending heavily to propel Trump back to the White House, Musk spent the first quarter of the year leading the president’s DOGE initiative to slash the federal workforce.

Musk also endorsed Germany’s extremist anti-immigrant party, AfD, and later supported British anti-Muslim and anti-immigration activist Tommy Robinson. In recent weeks, Musk has called to abolish the European Union.

Partly in response to Musk’s incendiary rhetoric, Tesla has faced an enduring consumer backlash in Europe and the U.S. The company hasn’t fully recovered despite introducing a new, more affordable version of its Model Y SUV in October.

However, Tesla shares still rallied in the second half of the year, jumping 40% in the third quarter, reaching a fresh record in mid-December. Musk bought $1 billion worth of shares in September.

Shareholders approved a new $1 trillion pay plan for Musk in November that will give the CEO more shares and increased control over the company. The vote came after Musk threatened to potentially leave Tesla if the plan didn’t pass.

Critics voiced concerns that the plan doesn’t require Musk to spend a minimum amount of time on his Tesla work and that there are no limits on his political activity.

While Tesla doesn’t break out deliveries geographically, data from the European Automobile Manufacturers’ Association (ACEA) showed that the company lost market share in the region in 2025.

Tesla’s European registrations fell 39% in the first 11 months of 2025, while Chinese rival BYD saw registrations rise 240% in Europe. Overall, battery electric vehicles were more widely embraced in Europe in 2025, amounting to around 16% of all new vehicles sold there.

Some analysts project that sales of Tesla’s more affordable Model Y standard, which the company launched in October, will help the company regain ground in coming quarters.

In a note last week, analysts at Cannacord Genuity wrote that EV adoption “is rising quickly in emerging markets such as Thailand, Vietnam and Brazil, where robust consumer interest could create meaningful long-term upside for Tesla, even as it faces fierce rivalry from Chinese automakers.”

Besides BYD, Tesla now faces competition from other Chinese EV makers including Xiaomi and Geely.

But Tesla is selling investors on Musk’s vision of the future, or what he calls “sustainable abundance,” more than EV sales. That vision includes robotaxis, which Musk has promised for years, and humanoid robots, which he says will someday be able to serve as factory workers, babysitters, crime stoppers and surgeons.

WATCH: Tesla will have to bend over backwards to keep share price up

BEIJING — China’s electric car boom is ending in 2025 on a soft note, with sales dipping and analysts warning that a fierce price war is likely to persist.

Not only did Tesla see its sales drop by 7.4% from a year ago, but market leader BYD also reported a 5.1% decline, according to data from the China Passenger Car Association covering January through November.

BYD‘s passenger car sales in November alone fell by an even steeper 26.5% from a year ago, while newer rivals, including vehicles powered by Huawei software and models from Xiaomi, recorded sales growth of more than 90% during the same period.

The early trio of U.S.-listed Chinese electric car startups — Nio, Xpeng and Li Auto — failed to make the top 10 sellers for the month, despite improvements in monthly deliveries.

Market concentration has increased sharply. The top ten manufacturers now account for around 95% of the Chinese new energy vehicle market — up sharply from around 60% to 70% just two or three years ago, according to Xiao Feng, co-head of China Industrial Research at Citic CLSA. New energy vehicles include battery-electric and hybrid-powered cars.

“I think there will be further industry consolidation even though prices matter more than specific brands,” he said. “Obviously buyers will not buy a car they [have] never heard of.”

The scale of price cuts highlights the pressure. Autohome, an online platform for car sales data in China, even lists vehicles by discount percentage, such as a 432,000 yuan ($61,660) drop for the Mercedes-Benz EQS EV or a 147,000 yuan reduction in the Volvo XC70.

Paul Gong, head of China autos research at UBS, expects the price war to keep going “for years,” while domestic policy changes will likely weigh on growth next year.

Beijing is set to re-impose a purchase tax while scaling back trade-in purchase subsidies, he said. UBS predicts the growth rate of China’s electric car sales to roughly halve next year from around 20% in 2025.

The market is already saturated, with new energy vehicles accounting for 59.4% of new passenger cars sold in China in November, according to the China Passenger Car Association.

In the first half of the year, Hangzhou-based Geely said its electric car exports quadrupled, helping bring overall vehicle exports to 184,000. The company entered Australia, Vietnam and four other markets during that time, extending its reach to around 90 countries. The automaker has also launched factories in Egypt, the Middle East and Indonesia.

Geely ranks second to BYD in China’s new energy vehicle sales.

BYD is also expanding its overseas production, including a new factory in Hungary slated to ramp up manufacturing in 2026. The company exported more than 131,000 cars in November alone.

Tu Le, founder and managing director at consulting firm Sino Auto Insights, expects more Chinese car manufacturers and battery companies to “firmly stake their claims in Europe,” bringing competition closer to the U.S. and Tesla.

German auto giant Volkswagen has forged local joint ventures with Xpeng and Chinese automotive chips designer Horizon Robotics. Volkswagen’s largest research and development center outside Germany is in Hefei, China, where the automaker said last month it can now complete every step of the vehicle development and approval process locally for the first time.

That capability could help Volkswagen launch cars more quickly in China, with several new models planned for 2026.

In the first three quarters of 2025, Volkswagen delivered more than 17 million vehicles in China, up 8.5% from a year ago, and far more than the 8.9 million vehicles it delivered in Western Europe.

China’s market size remains lucrative for foreign businesses. “It’s not lost for the U.S. automakers,” said Sino Auto Insights’ Le.

He noted that General Motors still delivers nearly 2 million cars a year in China, and, like Ford, also exports cars from the country. The automakers could turn that manufacturing capacity inward if they can design vehicles capable of competing in China, he said, noting “that’s where GM is closer than Ford.”

Le cautioned that it could be too early for any automaker, domestic or foreign, to declare victory in the world’s largest auto market.

“But in China, you could be on top one month, and by next quarter, you’re playing catch-up and wonder what happened.”