Why Chinese EV makers are outpacing the West with software-first cars

By the end of 2025, the global electric-vehicle market looked very different. Chinese manufacturers had moved into leading positions, supplying around 43% of all EV sales worldwide. Eight of the ten top-selling models now came from China. The shift stems not only from pricing but from approach: these brands develop new models faster, keep tighter control over supply chains, and increasingly treat the car as a digital product rather than a purely mechanical machine. It’s increasingly evident that this software-first posture is resetting expectations.

BYD — scale, control, and price

BYD is currently the world’s largest EV maker by output. It designs batteries, electric motors and even chips in-house. That level of vertical integration lowers costs and reduces dependence on external suppliers. Models like the BYD Seagull compete successfully with overseas rivals thanks to sharp pricing paired with solid range and equipment.

In 2025, BYD began production in Hungary and Brazil, sidestepping import tariffs and moving closer to key markets. In parallel, it has been building a premium presence via the Yangwang sub-brand and is preparing to launch the new Seal 08 and Sealion 08 in early 2026 with a refreshed design language. The strategy blends volume discipline with a steady push upmarket.

Xiaomi — a bet on the ecosystem

Xiaomi’s entry into autos was one of the most striking developments of recent years. Its SU7 electric sedan sold more than 200,000 units in under a year. The edge came from integration with HyperOS, which ties smartphones, the smart home and the car into a single ecosystem.

In 2025, Xiaomi unveiled the YU7 crossover with a 900-volt architecture and “Zero Gravity” seat technology. Production quickly climbed above 40,000 vehicles a month — a level many traditional automakers struggle to reach early on. That momentum suggests consumer-electronics DNA can translate into automotive scale.

NIO — rethinking charging

NIO chose its own path and bet on rapid battery swapping. Its global network already includes more than 4,000 stations, and a swap takes less than three minutes. That removes one of the biggest headaches of EV ownership: long charging times.

In 2025, the company expanded its lineup with the Onvo sub-brand for families and Firefly for Europe. A focused push in the Netherlands and Norway sets the stage for entry into the United Kingdom and the Benelux in 2026. If swapping continues to scale, the whole charging debate starts to look different.

Geely — power of platforms and brands

Geely leverages a distinctive advantage: ownership of Volvo, Polestar and Lotus. On that foundation it is building the premium Zeekr brand, which draws on advanced technologies. The refreshed Zeekr 001 at the end of 2025 adopted a 900-volt platform and a Golden Brick battery that charges from 10 to 80% in roughly seven minutes.

The flexible SEA architecture allows Geely to bring EVs across segments to market quickly, cutting costs and accelerating scale — platform thinking applied with intent.

XPeng — cars defined by AI

XPeng has secured its niche in AI-focused vehicles. The 2025 lineup is fully aligned with an “AI-defined” approach, where software takes the lead. The affordable Mona M03, with advanced driver-assistance, became a hit, and the Mona SUV is set to challenge Tesla’s Model Y in 2026.

A partnership with Volkswagen, the in-house Turing chip and permissions for Level 3 autonomous driving have pushed the brand among the leaders of the tech race. Expansion into Europe, Australia and South Korea only reinforces those ambitions. More and more, XPeng reads like a software company that builds cars.

Why the West is behind

Chinese companies develop new models in 18–24 months, while Western brands often need up to six years. In China, the focus falls on software, user experience and AI; many Western automakers remain anchored in traditional parameters. Even trade barriers don’t halt Chinese brands — they simply shift production closer to end markets. Speed, after all, is hard to tariff.

By 2026, Chinese EVs stop being outliers and become a serious threat to global auto giants. Pace, technology and flexibility give them a strategic edge that’s increasingly difficult to ignore. Unless incumbents match that cadence and software depth, they’ll be reacting rather than leading.