The leader of BYD has stated that the Chinese carmaker is capable of surpassing Toyota to become the top global vehicle producer, all while avoiding the American market, which ranks as the largest outside of China for new cars.

BYD founder Wang Chuanfu recently outlined plans to eclipse Toyota inside five years, a bold goal since the Chinese firm sold roughly half the volume of the Japanese company last year. BYD delivered 4.5 million units in 2025 while Toyota reached 10.5 million.

In remarks to the Financial Times, BYD chair Stella Li indicated the goal of becoming the largest automaker globally could still be met even with existing trade restrictions that bar passenger car sales in the United States.

"I think he made this ambitious target with our own organic growth," Ms Li, who oversees BYD international operations, told the Financial Times. "We don't need the US market to achieve that."

The United States stands as the biggest new-vehicle market outside China, with over 16 million units sold in 2025. For comparison, Europe saw roughly 13 million new vehicles purchased last year, and Australia recorded a record 1.24 million in 2025.

Ms Li's statements further imply that BYD intends to reach the top position through internal expansion rather than purchasing other companies to inflate totals.

Toyota has held the title of world's best-selling automaker since 2020, aided by combined volumes from Toyota, Lexus, Daihatsu and Hino brands that allowed it to regain the lead from the Volkswagen Group after four years.

Although Toyota keeps its global lead, the swift ascent of Chinese brands has added pressure on its pricing and margins in important regions even as it continues selling more vehicles than any competitor.

Meanwhile the Volkswagen Group, which once competed with Toyota to be the first to exceed 10 million annual sales more than ten years ago, is working to restore performance via plant closures and staff reductions under a wide restructuring effort.

The German company has also faced unconfirmed speculation about becoming a takeover target for BYD, though such ideas seem even less probable following Ms Li's focus on purely internal expansion.

BYD is turning more to exports as domestic Chinese demand growth slows.

BYD reported selling 1,808,511 new energy vehicles worldwide in the first half of 2026, including a record 792,256 units shipped overseas.

Although BYD leads among Chinese automakers, it still trails the largest global producers, with full half-year 2026 figures for several rivals yet to appear.

Toyota has not released its first-half 2026 results, but company data show 4,463,796 vehicles sold worldwide from January 1 to May 31, 2026, marking a 3.1 per cent drop compared with the prior year.

Toyota holds the top global position ahead of the Volkswagen Group and the Hyundai Motor Group in third place.

China's automotive export goals face growing hurdles from tariff conflicts with both the United States and European Union, as new vehicles become entangled in wider trade disputes.

This includes an effective prohibition on Chinese-made connected vehicles in the US, justified by national security issues and efforts to favor local production.

The shifting trade environment has prompted Toyota to start offering US-built versions of the Tundra, Highlander and Camry in Japan.

In July 2026, US Congress introduced the Protecting America from Chinese Cars Act, which would prohibit connected vehicles produced or controlled by automakers tied to adversarial nations.

Announced in Michigan, home to Ford and General Motors, the measure followed Canada's choice to permit up to 49,000 Chinese-built vehicles per year subject to a 6.1 per cent tariff.

If enacted, the law would stop drivers from bringing affected Chinese-made vehicles from Canada into the United States.

The initial delivery of nearly 3000 Chinese-built vehicles reached Canada in May 2026. Although brands were not officially named, reports pointed to possible inclusion of Tesla, Polestar and Volvo models.

Polestar was barred from US sales in June 2026 even though sister brand Volvo, also under China's Geely, continues operating there. The move occurred despite Polestar setting up a US production site.

US restrictions persist despite some American industry voices calling for closer ties with Chinese makers, including Ford CEO Jim Farley who supports joint ventures between US and Chinese firms.

The proposal marks a shift from China's earlier approach that required foreign manufacturers to partner with local companies for local production.

Australia serves as a useful indicator of global automotive rivalry thanks to free-trade pacts with China, Japan, Thailand and the United States, while the European Union stands to gain from an agreement expected late 2026 or early 2027.

BYD came within 243 sales of passing long-time leader Toyota in Australia during June 2026, less than four years after the Chinese brand introduced its first high-volume model locally.

Although BYD now brings its own vehicles into Australia, it first entered via independent distributor EVDirect, whose founder forecast the brand would become Australia's largest by 2027.

When questioned by CarExpert last month on whether it could overtake Toyota in Australia, BYD vice president Liu Xueliang replied that success ultimately rests with Australian buyers.

In the near term, BYD targets a top-three sales finish in Australia this year.