| Thanks for reading Hyperdrive, Bloomberg's newsletter on the future of the auto world. It's been a humbling year for the world's biggest automakers. Many executives who attended the Beijing auto show this spring were blown away by what they saw — Chinese manufacturers had surpassed them on software, electrification and cost competitiveness. The cars don't look like knockoffs anymore, either — styling often is a strong suit. They have the wow factor, as one attendee told me at the time. It might be tempting when one has been asleep at the wheel to chalk up the rise of Chinese carmakers led by BYD to unfair subsidies, especially since leaders in Washington and Brussels have done so. No doubt, China is far from a free, fair and open market. The scale and pervasiveness of corporate subsidies at the federal and local level far exceed what other market-based economies offer. But this isn't the whole story. If the US, Europe, Japan and South Korea want to effectively compete with the likes of BYD, they're going to need to better understand this company and how it operates. That's where this month's Bloomberg Businessweek cover story comes in. We introduce you to Stella Li, the force of nature in BYD's upper ranks: The company got its first big break thanks to a young saleswoman named Li Ke, known outside Chinese-speaking circles as Stella Li. If Wang is the visionary engineer guiding BYD's elaborate skunkworks, Li, the company's No. 2, is the driving force behind its expansion, representing BYD in meetings with customers such as Apple Inc. or leaders including the president of Brazil. She graduated from China's prestigious Fudan University with a degree in statistics and joined BYD in 1996 as a marketing manager for global exports. Wang sent her to Europe and the US to set up offices, and her efforts in that role are the stuff of company lore. In her mid-20s and with a rough grasp of English, Li showed up with a box of battery samples and spent months courting the procurement team at Motorola's battery R&D campus in the Atlanta suburbs. Motorola executives thought she was a pest, according to one who dealt with her at the time, but the cost savings she was promising were so great and Li was so persistent that they eventually agreed to test BYD's battery cells. It took two years of evaluation to win the contract. At one point Motorola was so impressed with Li that the company tried to hire her for its sales team, says the executive, who asked not to be identified discussing private matters.
BYD is the brainchild of Wang Chuanfu, a 58-year-old battery scientist who in the 1990s saw an opportunity to start a rechargeable battery company to challenge Japan's hold on the industry. It began by focusing on batteries for mobile phones and power tools, but in 2003 it decided to pursue cars. Two decades later, Wang, Li and BYD are doing what Tesla, Ford and the rest of the auto industry haven't: build affordable electric cars for the masses and make money doing it. Li says she likes boxing, weightlifting and spending time with her kids when she isn't working, which is almost never. Here's what she had to say about the role state support has played in BYD's ascension: Like many Chinese executives, Li bristles at the notion that BYD owes its success to government largesse and calls subsidy accusations "completely groundless." BYD is so formidable because it's emerged victorious from China's brand of state-led capitalism, which weeds out weak or inefficient players by forcing them to compete in a protected, carefully calibrated sandbox. For Li, that victory was hard won, the result of grit and determination. "They cannot beat us and can only attribute our success to other factors," she says. "We'd rather just show our muscles than make explanations to them."
And here's some more where that came from, on how BYD separated from the pack during the pandemic: Wang retooled his production lines previously used for assembling smartphones to make N95 masks. In a matter of weeks, BYD became the world's biggest mask manufacturer, adding more than $1 billion to its coffers thanks to contracts with Japan's SoftBank Group Corp., the state of California and others clamoring for personal protective equipment. Unlike the rest of the global auto industry, BYD avoided factory shutdowns and supply chain snarls. It had a steady supply of chips made by its semiconductor unit and an abundance of masks for Chinese workers living in tightly controlled on-campus dormitories. "When everybody else was lying flat during Covid, our factories were running 24 hours," Li says. "When everybody else is having a work-life balance, we only have work balance." BYD's electric and hybrid vehicle car sales rocketed from just under 180,000 in 2020 to 1.86 million in 2022, giving Wang and Li the cash to fund a new overseas push.
Check out this story in full here. And if you're interested in learning more about how Apple secretly worked with BYD for years as part of its now-canceled car project, we have just the sidebar story for you here. — By Gabrielle Coppola and Danny Lee  Boston Dynamics' Atlas robot. Source: Boston Dynamics Toyota's research unit and Hyundai's Boston Dynamics are joining forces to speed up development of humanoid robots with artificial intelligence. The partnership will pair Toyota Research Institute's expertise in large behavior model learning for machines with Boston Dynamics' humanoid Atlas robot. Boston-based teams from TRI and Boston Dynamics will conduct research on use cases for AI-trained robots in areas such as human-robot interaction, they said. "This kind of technology has tremendous promise for the future," Gill Pratt, Toyota's chief scientist, said in an interview. "The work that we're doing in generative AI can be a tremendous compliment to the kind of work that Boston Dynamics has done." | 
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