TheChek News Flow

Cashmere brand becomes fifth fashion house to be monitored in probe into labour rights violations in Italian supply chains

A Milan court placed Loro Piana under judicial administration for subcontracting production to suppliers that allegedly exploited workers, making the LVMH-owned cashmere brand the latest fashion house to be caught up in a series of investigations into labour rights violations.

The court said Loro Piana had handed the production of apparel, including jackets, to Evergreen Fashion Group, which is owned by a Chinese company.

“The production of such apparel had been carried out in a context of labour exploitation,” according to the ruling seen by the Financial Times.  

Loro Piana has been placed into a one-year court administration to address the shortfalls in its supply chain, the ruling shows. The sanction means a court-appointed administrator will oversee the brand’s operations.

The brand is not under criminal investigation and the order will be lifted if the company complies with legal requirements before the 12-month deadline given by the court. 

Loro Piana said on Monday evening: “In breach of its legal and contractual obligations, the supplier did not inform Loro Piana of the existence of these subcontractors. Loro Piana was made aware of this situation on May 20, and, as a result, the maison terminated all relations with the concerned supplier in less than 24 hours.

“Loro Piana firmly condemns any illegal practices and reaffirms its unwavering commitment to upholding human rights and compliance with all applicable regulations throughout its supply chain.”

Evergreen could not be reached for comment.

Loro Piana was bought by LVMH, the world’s largest luxury conglomerate, in 2013. Frédéric Arnault, son of LVMH founder Bernard Arnault, was appointed chief executive of the Milan-based fashion house in March. 

It is the fifth fashion company to have been placed under court administration over labour issues in Italy in the past 18 months, in a scandal that has tarnished the image of the country’s luxury industry.

Milanese prosecutors have been investigating the industry’s supply chain for several years after media investigations uncovered multiple cases of labour malpractice across several companies that have Chinese owners based in Lombardy and Tuscany.

Luxury brands subcontracted production to meet heightened demand during the pandemic-era luxury boom.

LVMH’s Dior, Italy’s Armani and Alviero Martini have had the restrictions placed on them lifted before the 12-month deadline.

Valentino, part-owned by France’s other luxury conglomerate Kering, was also subjected to a similar order in May. It said it would co-operate with the authorities to better understand what prompted the measures.

China’s economy grows 5.2% in second quarter

World’s biggest exporter shrugs off impact of Trump’s trade war

The Chinese economy expanded 5.2 per cent year on year in the second quarter as the world’s biggest exporter shrugged off the impact of Donald Trump’s trade war.

The rate, which slightly exceeded the 5.1 per cent average estimate from analysts polled by Reuters, positions Beijing to hit its full-year target of about 5 per cent. It shows how China has been able to keep growth on track through exports and investment even as it struggles with weak demand at home.

Shuang Ding, chief economist for greater China and north Asia at Standard Chartered, said that, although real GDP growth was better than expected in the first half of the year, the second half could be challenging.

“There will be some headwinds,” Ding said, noting that first-half growth had been boosted by frontloading trade ahead of US tariffs and greater fiscal spending. “Higher tariffs will take a toll on China’s exports,” Ding said.

China’s markets were muted following the readout, with the benchmark CSI 300 share index and the currency, the renminbi, little changed during early trading. In Hong Kong, the Hang Seng index rose 0.9 per cent. 

China’s President Xi Jinping, who needs robust exports and manufacturing to offset a property slowdown, faces a crucial test in the coming weeks as Beijing hammers out a final trade deal with the US.

On Monday, China reported strong second-quarter trade figures after a truce in the trade war last month enabled producers to ship more goods abroad.

The US is seeking to throttle China’s exports by imposing high tariffs on the transshipment of goods through third countries such as Vietnam.

China’s National Bureau of Statistics reported on Tuesday that industrial output grew 6.8 per cent year on year in June, exceeding an average analyst forecast of 5.7 per cent.

Retail sales increased 4.8 per cent year on year in June compared with a 6.5 per cent rise the previous month.

Yuhan Zhang, principal economist at The Conference Board’s China Center, said the primary drivers of GDP growth in the second quarter were industrial value-added, accounting for about 45 per cent, followed by retail sales at about 31 per cent.

“Manufacturing and high-tech industries are leading industrial growth, with standout gains in, for example, robotics, new energy vehicles, and equipment manufacturing,” he said.

China’s real estate downturn continued to drag on growth. Average new home prices declined about 3.7 per cent last month from a year earlier while second-hand residential property prices fell about 6 per cent.

“Households and firms have a strong propensity to save,” Zhang said.

Sheng Laiyun, deputy commissioner of the NBS, said the “bottoming out” of the real estate market was “a normal phenomenon”.

Economists worry that overproduction in many sectors, combined with weak demand, is driving deflationary pressures. In recent weeks, Chinese Communist party media has criticised industrial overcapacity for driving a vicious price war in the domestic market.

“The Chinese economy’s performance is both encouraging and concerning, with decent GDP expansion in the first half of the year overshadowed by unbalanced growth driven by investment and exports,” said Eswar Prasad,

professor of economics at Cornell University.

“China is likely to need more policy stimulus as well as structural reform measures in the second half of 2025 to bolster the economy’s performance, make growth more balanced, and fend off deflationary pressures,” Prasad added.

What could Zohran Mamdani mean for NYC’s prime property market?

Some homeowners are worried by the prospect of a ‘radical socialist’ mayor — but they underestimate the resilience of this high-stakes, high-reward city

After an unexpected twist in New York City’s recent Democratic mayoral primary, questions are swirling about what the city might look like under Democratic candidate Zohran Mamdani if he wins the election in November. As a realtor, the question I’m hearing most from buyers and sellers is: what will this mean for New York’s prime real estate market?

A socialist mayor potentially taking office makes for an easy knee-jerk narrative in certain circles: he’ll drive out businesses, tank the value of homes at the top end of the market; high-net-worth individuals will flee, the market will crater, and the city’s global standing will deteriorate. But when it comes to NYC real estate, fears like these regularly appear for one reason or another — and tend to be driven more by sentiment than substance.

To embrace the idea that a political newcomer could immediately enact sweeping changes in a city as complex and bureaucratically entrenched as New York overlooks how difficult meaningful reform can be. Take, for instance, the proposal for a “millionaires’ tax” floated in 2017 during a mayoral race. It generated similar headlines and narratives but ultimately stalled. Campaigning for ambitious policies is one thing; turning them into law is another. The idea that Mamdani could unilaterally upend the real estate market overnight reflects political anxieties more than the practical realities.

There are understandable questions about Mamdani’s policies, his experience, and how feasible some of his proposals — including raising property and corporate taxes — may prove in practice. But while a mayor can influence the city’s budget and policy direction, they cannot impose new taxes unilaterally; that authority rests with the state legislature.

Still, buyers and sellers are right to be paying close attention. The key is to distinguish between informed caution and premature conclusions. The more carefully buyers and sellers evaluate what a new administration could realistically implement, the more effectively they can prepare.

We’ve seen this kind of doomsaying before. Fear is a well-worn cycle in New York. In 2020, headlines predicted the city’s permanent decline, in countless iterations of the same message: “New York is dead”. But just a few years later, the picture looks very different. Restaurants are packed, home inventory is tight and the city feels as alive as ever. 

During Covid-19, buyers and sellers were faced with a simple decision: believe in New York’s long-term resilience and ride it out, or quit. Walk away from a contract deposit. Sell at a loss. I had many top-of-the-market buyers who considered walking away from deposits on signed deals in prime neighbourhoods such as Tribeca and the West Village. We advised them to hold steady, and they did. Today, those same properties are worth 25 per cent more.

Many who left, meanwhile, are now returning from their so-called “permanent” moves to South Florida.

More broadly, to assume that a potential tax adjustment would categorically deter wealthy individuals also oversimplifies how many assess value. Real estate in New York has never been easy, convenient or cheap. Buyers face bidding wars and title insurance as well as high attorney fees, complex financing approvals and — for those purchasing in co-ops — rigorous board interviews, financial scrutiny and, in some cases, the inability to finance altogether. Property taxes are layered with a mansion tax, mortgage recording tax and overlapping state and city income taxes. Simply put, it has always been easier to buy a home in the suburbs than within NYC’s roughly 300 square miles.

The city has always come with trade-offs: noise, traffic, bureaucracy and, yes, taxes. But it’s also a city that delivers. Little compares to a prewar Fifth Avenue co-op overlooking Central Park or a landmark SoHo loft with original cast-iron columns and 14ft ceilings — all within walking distance of some of the best dining, shopping and entertainment in the world.

As for the state of the market right now, there doesn’t appear to be significant jitters. Between March and June 2025, while Mamdani was actively campaigning, our team represented clients in more than $165mn worth of New York City real estate transactions, including the most expensive sale ever recorded in Downtown Manhattan. The Manhattan market as a whole finished June with contracts signed on 153 properties worth more than $4mn, according to the Olshan Luxury Market Report — marking the third-best June since 2006.

The coming months will tell if the primary has had any real impact. But otherwise, as is typical every summer, July is expected to be quieter, with buyers stepping back until after Labor Day. That seasonal dip often presents a compelling opportunity for buyers who stay local.

As for reports of deals falling through, real estate transactions collapse year-round, and for all kinds of reasons — mismatched expectations, bad timing, shifting buyer priorities or sellers holding out for a higher number. That’s New York: high stakes, high reward. Suggesting that a mayoral race is the sole culprit behind anecdotal failed deals is to conflate narrative with data.

Plan to boost returns from Russian assets ‘expropriation’, warns Euroclear

Clearing house chief executive warns against EU plan to raise more money for Ukraine by investing in riskier assets

EU plans to raise more money for Ukraine by putting frozen Russian state funds into riskier investments would amount to “expropriation”, the institution holding the bulk of the assets has warned.

Euroclear chief executive Valérie Urbain told the Financial Times that plans to reinvest cash generated by the assets to yield higher profits could risk further retaliation from Moscow, and undermine the central securities depository’s key position in the financial system.

“If you increase the revenues, you increase the risks. And so who is bearing that risk?” Urbain said in an interview.

The European Commission is considering how to extract more value from some €191bn in Russian central bank assets stuck at Euroclear because of western sanctions. Euroclear is reinvesting the cash arising from Russia’s maturing assets — such as coupon payments and redemptions — mainly through central banks. The G7 is using the returns to back a $50bn loan to Kyiv.

Profits from the assets have been declining as the European Central Bank lowered its interest rate. That has prompted the commission to propose

shifting the cash into riskier asset classes that might generate higher yields, but also carry a greater risk of losses.

Urbain warned that someone would have to cover such potential losses.

“The systemic risk would certainly dramatically increase if we would have to go beyond the risk profile that we have and which is authorised by our supervisors,” she said.

Last year, Euroclear paid €4bn to Ukraine, and has paid out €1.8bn this year, Urbain said.

She added that the EU’s plans to increase those amounts could involve creating a “special purpose vehicle” to which the Russian central bank assets would be transferred. The SPV would be able to channel the cash generated from the assets into riskier investments and “hopefully, by taking more risks, bring more revenues”.

But Urbain warned at the same time that such a scheme would create “a lot of risks for Euroclear and for the European markets globally”.

“Legally speaking, the creation of an SPV would mean an expropriation of the cash from Euroclear” without freeing it from the liability of restitution against the central bank of Russia, she said, adding that this would result “clearly [in] a position that we cannot bear”.

Discussions around the seizure of Russia’s central bank assets have ebbed and flowed since about €260bn were frozen in different jurisdictions in the wake of Moscow’s full-scale invasion of Ukraine in February 2022, but the legal and financial risks of confiscation have always prevailed.

Euroclear faces more than 100 lawsuits over immobilised Russian assets, including those belonging to oligarchs and other sanctioned entities. According to sources close to Euroclear, Russia has confiscated €33bn in assets belonging to Euroclear clients that had been immobilised at Euroclear’s Russian counterpart, the central securities depository in Moscow.

Euroclear, with more than €40tn assets in custody, is Europe’s largest central securities depository — a key node of the financial market facilitating and settling trades by holding and transferring assets.

“We should also certainly expect more Russian retaliation in all sorts of forms,” Urbain said.

She warned that the only way such a scheme could be viable was that “in case of any call for restitution from the central bank of Russia, the assets are gone, somebody is covering for the amount”.

Separately, Urbain announced that Euroclear was keen to further the EU’s initiatives to integrate the bloc’s fragmented capital markets, something that Brussels has been pushing in order to tap into unused savings and improve financing for companies.

She said that Euroclear would offer a “single access point” for retail and institutional investors across the 27 member states.

Urbain also said she would be in favour of more centralised supervision of central securities depositories, another key element of the EU capital markets initiative.

Outgoing president Dame Julia Black calls on ministers to overhaul their ‘confused’ approach to higher education

England’s higher education system risks long-term decline unless ministers overhaul their “confused, if not incoherent” approach to universities, the outgoing head of the national body for the humanities and social sciences has warned. 

Dame Julia Black, president of the British Academy, told the Financial Times that the government must take higher education out of the “too difficult box” and “radically” reform the sector by axing its regulator and launching a cross-party commission into its future.

“The way universities are viewed by government is very confused, if not incoherent. There is nobody within government looking at the university system as a whole and thinking, ‘What do we want this to achieve, both for students but also for the country?’” she said.  

“We need a national conversation to protect our competitive advantage . . . But is it easier [for ministers] to just watch incrementally universities go to the wall on a slow burn basis? Probably.

“The Department for Education doesn’t really have much of a view of what it wants to do with higher education at all.”

The comments by Black, who will leave her post on Thursday after four years, come as universities take drastic cost-cutting measures to avert a wave of insolvencies amid a long-term funding squeeze and softening enrolment of international students. 

In May, ministers slashed capital funding for higher education.

They also reduced the length of the graduate visa from two years to 18 months to discourage abuse of the system and proposed a 6 per cent levy on universities’ fee income from overseas students to fund domestic skills programmes.

But Black, a specialist in law and regulation, said the levy, if enacted, would further squeeze universities’ finances and add to the impression that Britain was “not welcoming to international students”, stunting the government’s drive to boost the economy and soft power. 

“It’s hard to be a big export industry if we are not getting international students. You can’t be both . . . Do you want this or not?” she added, pointing to European countries’ “focus on research and universities as engines of their own industrial growth”.

Asked what reform would look like, Black called for the abolition of the Office for Students, set up by the previous Conservative government, which “just sees universities as a marketplace and students as consumers”.

It should make way for a new regulator with a wider remit to take account of higher education’s benefits for individual students as well as the public, she said.

Ministers should also establish a commission to explore “all the options” for the sector, including a new cap on student numbers, higher tuition fees and breaking with the traditional three-year undergraduate degree from the age of 18, she added. 

“Often this kind of quite radical rethink is prompted by a massive crisis . . . I don’t really want a massive crisis to make it happen, but I think universities have to be part of that conversation,” said Black, who is warden of Nuffield College, Oxford. 

The Department for Education said it was “determined to restore our world-class universities as engines of aspiration, opportunity and growth”.

“We will soon publish our plans for reform as part of the post-16 education and skills strategy white paper as we fix the foundations of higher education,” it added.

The Office for Students said it was “focused on ensuring the protection of students through challenging times for the sector . . . and that taxpayers’ investment in higher education is protected”.

“Students are much more than just consumers, but they spend a lot of time, money and effort to attend university and deserve protection when doing so,” it added.

Founded by royal charter in 1902, the British Academy has a 1,700-strong fellowship, which includes classicist Dame Mary Beard, historian David Olusoga and philosopher Baroness Onora O’Neill. 

In 2023-24, the latest year for which data is available, the Academy recorded income of just under £75mn, including a grant of £51mn from the Department for Science, Innovation and Technology.

In the same period, it distributed £55.5mn in research awards to academics in the UK and overseas. 

Black said that while research in social sciences and the humanities was “really strong” in the UK, the subject areas were “bearing the brunt” of university job cuts and course closures. 

This opened the door to a “potential vicious spiral”, she warned, where drops in undergraduate enrolment led fewer qualified specialists to become teachers, resulting in fewer school leavers opting for disciplines such as archaeology or modern languages and more course closures. 

“You can paint whichever picture you want [with the data]. But the decline will be felt slowly, and once you lose that capacity it’s incredibly hard to build back up again,” Black said, pointing to “cold spots” across the country where cutbacks meant young people already had to travel more than 200km from home to study some subjects. 

She rejected the view that humanities and social sciences were less useful to students and to the country than some other subjects, such as maths and science, describing them as “absolutely essential . . . both to living a full and prosperous life but also to addressing many of the challenges we face”. 

“You’ve got more languages students setting up successful start-ups than you do maths graduates, and the same number of history students setting up start-ups as engineers, so there’s a bit of myth busting that needs to go on.”

How BYD caught up with Tesla in the global EV race

The Chinese group is poised to outsell its US rival this year after it dramatically narrowed the technology gap between the two

In mid-2022, when BYD executive Lian Yubo was asked to compare Chinese manufacturing with Tesla’s technology, he remarked that Elon Musk was an example that all Chinese carmakers could learn from. 

“Tesla is a very successful company no matter what. BYD respects Tesla and we admire Tesla,” he said in an interview on Chinese state media. 

Yet just three years later, Tesla’s technological lead over its Chinese rivals has narrowed dramatically. It is fighting to stay ahead in the world’s largest car market, its sales are falling in many other countries and its efforts to develop fully self-driving vehicles are running into regulatory roadblocks.

Having once scoffed at the idea that BYD could ever be a competitor to Tesla, Musk returned from a visit to China last year with a sombre assessment for his senior management. “He had seen the BYD factories, the cost and their tech,” says one former Tesla executive, adding that Musk believed China was winning the electric vehicle race.

As Tesla’s sales decline following Musk’s forays into US politics and amid a lack of new models, BYD has overtaken it to become the world’s largest manufacturer of EVs. Its annual revenues surpassed $100bn for the first time in 2024.

Now, the industry’s shift towards autonomous vehicles and artificial intelligence is writing a new chapter in what has become not just a rivalry between the world’s top two EV makers, but a central pillar of US-China technological competition. 

“In the west, Tesla still owns EVs, they still have a clear lead on software-defined vehicles and everyone is still trying to catch up to that,” says Barclays analyst Dan Levy. “China is a different situation. Tesla’s lead from a tech perspective is not nearly as clear, if there’s any lead at all.” 

Until recently, the main advantage Chinese EV manufacturers had over Tesla was that their products were significantly cheaper. But in February, BYD’s founder Wang Chuanfu stood on stage in Shenzhen and unveiled “God’s Eye”, an advanced driver-assistance system that is a precursor to fully autonomous vehicles.

A month later, Lian, who now heads BYD’s automotive engineering research institute, was on stage with Wang to announce a new battery charging system capable of adding a driving range of about 470km in five minutes — a fraction of the time it would take a Tesla to charge to that level.

The startling technological advances made by BYD and others have sparked panic among legacy carmakers, who have responded by partnering with Chinese rivals to learn how to build vehicles faster and cheaper, and with better software.

Mark Greeven, professor of innovation and strategy at IMD in China, says Musk “took his eye off the ball” just as Wang progressed from battery technology to software and chip development.

“Tesla did fall back . . . BYD clearly used that time to catch up and say, ‘We’re going to invest in a set of capabilities that are going to make us competitive in the long term.’”

But the man who forced an entire global industry to take electric propulsion seriously is not about to give up. In May, Musk stepped down from his US government role to focus on advancing Tesla’s new growth areas: autonomous vehicles, AI, robotaxi services and a humanoid robot called Optimus.

He says the new products will spur Tesla to become the most valuable company in the world, with a market capitalisation in the tens of trillions. 

“His reasoning is: will car companies exist in 10 years without autonomy?” says the former executive. “Probably not, like flip phones versus the iPhone.” With the race to commercialise EVs almost over, he adds that “Tesla has to win in AI and autonomy”.

Known within BYD simply as “the chairman”, the 59-year-old Wang used his obsession with batteries to enter car manufacturing in the early 2000s.

Having attracted investment from Warren Buffett’s Berkshire Hathaway in 2008, he oversaw a period of staggering growth for the Chinese group, which sold 4.27mn vehicles last year, nearly 10 times as many as in 2020. Of that total, 1.76mn were pure EVs.

Over the same four-year timeframe, Tesla’s sales went from just shy of 500,000 vehicles to 1.79mn — but BYD is in pole position to overtake Tesla in annual global EV sales for the first time in 2025 as it expands overseas.

In China it now commands a 21 per cent market share, according to Shanghai consultancy Automobility. Tesla, the company credited for sparking consumer interest in electric vehicles when it brought its first model to China in 2013, holds 8 per cent.

The success of BYD has come to symbolise the rise of Chinese auto manufacturing, an industry that was once heavily reliant on foreign partners such as Volkswagen, Toyota and General Motors for design and manufacturing knowhow.

While other western carmakers were compelled to form joint ventures with local groups, China changed its investment rules to allow Tesla to fully own and operate its Chinese subsidiary. The government reasoned that Tesla’s presence — via two massive plants to build its Model Y saloon and battery packs in Shanghai — would help its domestic infrastructure and supply chain learn and modernise.

Tesla accepted the risk of hardware and intellectual property being transferred, but concluded it was worth it in order to gain access to a huge new market, according to a person familiar with its negotiations.

Yet the speed with which Chinese carmakers learnt and innovated enabled them to leave some of their European and Japanese rivals behind in the EV transition, according to Mathew Vachaparampil, chief executive of Caresoft, a specialist in cost reduction engineering.

“While the legacy manufacturers in Europe, the US and Japan say [Tesla’s] technology will not work in their vehicles, the Chinese say Elon Musk is the leader,” Vachaparampil says. “They are now not only copying Tesla’s technology, but improving it very quickly.”

Gigacasting, a method of casting and pressing fully formed chassis parts instead of welding together smaller components, is a good example. The process, which reduces vehicle weight, cuts manufacturing times and reduces labour costs, relies on a specially formed aluminium alloy developed by engineers at SpaceX, another Musk company.

It was introduced for Chinese-made Model Y sports utility vehicles in 2021. But according to Caresoft analysis, by the time China’s Xpeng released its G6 SUV in 2023, it had already adopted a gigacasting system that was both lighter and more rigid than the one used by Tesla. 

Xpeng and many other Chinese brands have also improved on Tesla’s lightweight, aluminium-made cables for charging and coolant pumps inside EVs. During the Shanghai auto show in April, BYD showcased a premium Denza Z concept car featuring an advanced steer-by-wire system — first introduced by Tesla in the Cybertruck. 

Chinese manufacturers have made innovations of their own, too. According to Caresoft, BYD has introduced around 100 cost-saving methods for a range of car components and materials that, if Tesla adopted, would save between $350 and $885 per vehicle. Alternatively, BYD could also save up to $1,860 per vehicle if it applied some of Tesla’s ideas used in its brake system and heat-exchanger equipment. 

Lizzi Lee, a fellow at the Asia Society Policy Institute’s Center for China Analysis, notes that China’s manufacturing ecosystem, including years of investment in infrastructure, supply chain clustering and engineering talent, has “created the conditions” for BYD to succeed.

“That tightly knitted production chain allows it to iterate faster, cut costs more effectively, and maintain a resilient supply chain,” she says.

Tesla believes that it still has significant advantages over Chinese rivals in areas such as automation technology, AI infrastructure, access to the latest Nvidia chips and billions of hours of driving video to train its neural network. 

“It’s relatively easy to steal or mimic hardware IP,” says one person close to Tesla. “It’s almost impossible to reverse-engineer our software.”

Musk’s biggest ambition in the short term is to deliver Tesla’s self-driving robotaxis at scale following a limited launch in its home city of Austin. While analysts have cautioned that it will be a challenge for Tesla to catch up with frontrunners such as Google’s Waymo, Musk claims the pivot to robotaxis and AI alone could take the company’s valuation as high as $5tn.

“I don’t see anyone being able to compete with Tesla at present,” he told investors in April. “As far as I’m aware, Tesla will have, I don’t know, 99 per cent market share or something ridiculous.” 

The company’s roughly $1tn market value suggests investors believe him. Meanwhile BYD, despite its success providing a wide range of affordable EVs, is not viewed as a software-focused group and, at around $140bn, is not valued like one either. Its core strength is still perceived as stemming mostly from Wang’s deep commitment to battery technology. 

The God’s Eye announcement marked a big shift from Wang, who had previously resisted following domestic rivals like Xpeng and Nio in self-driving technology amid questions over safety. Suddenly, BYD was in the game. 

Early versions of the technology are not as advanced as Tesla’s fully self-driving system, offering only basic functionality such as highway navigation and lane changing. But BYD plans to offer God’s Eye in most models at no additional cost, a move analysts say could jeopardise Tesla’s plans to seek a premium for its FSD-equipped vehicles.

Tu Le, a founder of Sino Auto Insights, a consultancy, says the key is not what BYD offers now but the volume of data being collected, which could put it in a position to “win” the race for driverless cars. Each one of the 4.3mn vehicles that BYD sells each year will soon be collecting data to train the company’s algorithms. 

Its size also allows BYD to secure competitive pricing for Nvidia chips that are used in its system, and enables it to provide semi-autonomous features often reserved for premium EVs in its Rmb70,000 ($9,600) budget hatchbacks. 

Tesla’s monthly sales in China are much lower than BYD’s, and fell by around 5 per cent in the first six months of 2025. But brand damage stemming from Musk’s political activism is not the cause, according to one current Tesla executive.

“Now if you show up with a Tesla and not BYD when there is a de facto ‘buy Chinese’ rule, you have to explain. People don’t want to do that,” the executive says. “Also, the Chinese cars are better.”

However, the bigger challenge for Tesla is China’s restrictions on data collection and transfer. FSD is based on a machine learning system that uses billions of hours of video to train an algorithm to make driving decisions in real time.

Musk has said China does not permit Tesla to transfer driving video generated from its Chinese fleet outside the country, while the US authorities also will not allow Tesla to do training in China. That has in effect resulted in a twin-track learning process, with the Chinese iteration of FSD inevitably having inferior performance because fewer vehicles feed data into it.

According to Duo Fu, a vice-president at Rystad Energy, a Norway-headquartered consultancy, FSD in China is much more reliant on simulations as opposed to real-life human driving experience. 

“Tesla has partnered with Baidu [a Chinese search and AI group] but Baidu can’t disclose all the data points to Tesla,” Duo adds. “The real-world data is definitely more valuable.”

While BYD might have home turf advantage when it comes to data collection and security, Wang’s late pivot to driverless functionality has created some risks for the group.

One is question marks over financial sustainability. Price wars among Chinese carmakers are putting margins and the industry’s balance sheet under strain as Beijing demands more action to protect suppliers in the world’s largest car market.

It has also opened up some rare chinks in BYD’s otherwise formidable vertical integration. Its market leadership has also enabled it to pressure suppliers for price cuts and extended payment terms, allowing it to rigorously control costs.

But according to Chris McNally, an analyst with US investment bank Evercore, the God’s Eye platform uses software and hardware partners, including Momenta, a Chinese group backed by General Motors in the US, and some chips from Nvidia. 

For years, the risks associated with reliance on US-made chips in particular have hovered over the Chinese car sector — plans for driverless systems could be held back at any moment by US export controls or sanctions. 

“Given the geopolitical environment, no one will invest in a technology with such a high risk that they’re still relying on foreign technology,” says Raymond Tsang, an automotive technology expert with Bain in Shanghai.

However, these vulnerabilities might not persist. Analysts believe BYD will soon develop most of its driverless systems in house and increasingly swap out Nvidia chips for those made by Beijing-based Horizon Robotics. “This is the BYD way to drive costs down,” McNally says. 

It would also be consistent with a broader shift towards self-reliance in key technologies, in response to Washington’s steadily increasing restrictions on technology exports to China. 

Yuqian Ding, a veteran Beijing-based auto analyst with HSBC, says that while BYD has not talked about developing a robotaxi service, executives have made “very clear” their plans to develop in-house all the important software and hardware needed for autonomous vehicles.

“With more than 5mn scale per annum, they can do everything,” Ding says, adding: “That’s the ultimate goal . . . Their target is much closer to Tesla.”

In an interview with the Financial Times this year, BYD’s executive vice-president Stella Li said competition with Tesla in EVs and autonomous technology would accelerate innovation, ultimately making BYD a “better” company. 

“In the future, if you are not producing an electric car, if you’re not introducing technology in intelligence and autonomous driving, you will be out,” she warned.

The Vomero 18 has become a top-seller for specialty retailers and a $100 million franchise for Nike.

Nike chief executive officer Elliott Hill told investors in the company’s fourth-quarter fiscal 2025 conference call last month that the worst is now over.

Net income and sales both declined again in the period, but based on Nike’s “Win Now” actions over the prior 90 days, Hill said: “From here, we expect our business results to improve. It’s time to turn the page.” Investors agreed, with Nike shares closing with a 15 percent increase the following day.

One spot where the numbers are already showing improvement is in running. Nike Running grew by “high single digits” in Q4, and Hill called out the success of the Vomero 18, which has already grown into a $100 million franchise after launching at the end of February.

Three specialty retailers who spoke with Footwear News all agreed: the Nike Running comeback is very much on.

Chris Farley, owner and president of Pacers Running, said Nike is outpacing all of its other vendors, with a 20 percent growth in sales so far in 2025. With five stores in Washington D.C. and Northern Virginia, Pacers has seen the Vomero 18 become its top-seller.

The story is the same for Philadelphia Runner and Heartbreak Hill Running Company, which has locations in Boston, Chicago and Santa Monica, Calif.

“I really liked the [Vomero 17], but we did not sell very many of them,” said Philadelphia Runner co-owner Ross Martinson. “The new Vomeros are the best-selling Nike right away. The problem has been the men’s (sizes), we haven’t been able to get enough of them. But that’s sort of a good problem.”

The Vomero 18 has come in the early days of a streamlined new era for Nike Running focused on three franchises: Pegasus, Structure and Vomero. In order, the franchises are targeted toward responsive cushioning, supportive cushioning and maximum cushioning.

Each banner gets three different silhouettes, starting with the numbered baseline model and offering upgrades through the Plus and Premium variants. The Pegasus is the only franchise to see all three of its models come to stores already with the Pegasus 41, Pegasus Plus and Pegasus Premium, the latter of which is Nike’s first sneaker to ever feature a curved, full-length Zoom Air unit.

Nike will follow up the Vomero 18, which uses a combination of ReactX and ZoomX foams, on August 7 with the Vomero Plus, which is boosted by a full ZoomX midsole. The Vomero Premium will then come October 2 with Air Zoom units at the forefoot and heel taking the max-cushioned proposition to the highest level.

Heartbreak Hill Running Co. co-founder Dan Fitzgerald, who’s also a Nike Running coach, said the Pegasus franchise has always sold well in his stores and credits the Swoosh with creating the super shoe. But outside of those areas, it’s been more hit or miss for Nike Running in recent years.

Anecdotally, Fitzgerald points to a personal friend who logs 10 miles a day and runs in On. Having enjoyed the Vomero 18 himself, he was curious what his friend would think of it. “He put them on and he said, ‘Yeah it feels pretty good.’ Then I hit up a week later and he said: ‘I’m actually blown away. That’s my favorite shoe.”

With only five of the nine sneakers from the Vomero, Pegasus and Structure lines having launched, it’s still too early to tell what effect the relaunch will have on consumers. At the very least, though, the new dividing lines does it make it easier for retailers to explain to customers.

“Our staff really dictate the experience on the floor,” Farley said. “I think [the shoes’ purposes] are more clear. A simpler approach has been much better, so they’re more comfortable bringing out, talking about features, benefits and all those things where they may not have been as clear in the past.”

The new silos serve to replace the Infinity and Invincible, the purposes of which weren’t quite as clear and were easy to conflate with each other because they have “In” as prefixes.

There is still some concern that the difference, for example, between a base and Plus model may not be quite as recognizable. “The Vomero Plus looks awesome too,” Martinson said. “I’m curious to see how that affects sales of he regular Vomero because it’s kind of a different feel, but they still look fairly similar. So we’ll see how that goes.”

As promising as this year’s returns have been for Nike Running, as well as the positivity of its forecast, it does indeed still have ground to make up in the sport.

For runners who may go out just once or twice a week, as well as walkers and broader fitness enthusiasts, Farley said Nike still isn’t winning that conversation. With those consumers, Brooks, Asics and Hoka still reign.

And because the super shoe race has become so crowded, Martinson believes it will be more important than ever for Nike to win over the more casual runners and offer the best shoes that won’t be used on race days. “[Nike has] dominated super shoes and still leads it, but where they were 90 percent of those sales, maybe they’re going to be 50 to 60 [percent] going forward,” he said. “So it feels like good timing for them. It certainly feels like a turnaround for Nike or a vibe shift.”

Meta is currently building out a data center, called Hyperion, which the company expects to supply its new AI lab with five gigawatts (GW) of computational power, CEO Mark Zuckerberg said in a Monday post on Threads.

The announcement marks Meta’s latest move to get ahead of OpenAI and Google in the AI race. After previously poaching top talent to run Meta Superintelligence Lab, including former Scale AI CEO Alexandr Wang and former Safe Superintelligence CEO Daniel Gross, Meta now seems to be turning its attention to the massive computational power needed to train frontier AI models.

Zuckerberg said Hyperion’s footprint will be large enough to cover most of Manhattan. Hyperion seems to be located in northeast Louisiana, in a town called Richland Parish, according to semiconductor analysts at Semianalysis. In 2024, Meta announced a $10 billion data center development in this town, originally slated to be a two GW super cluster. Zuckerberg noted in his post that Hyperion would scale to five gigawatts over “several years.”

Zuckerberg also noted that Meta plans to bring a 1 GW super cluster, called Prometheus, online in 2026, making it one of the first tech companies to control an AI data center of this size. Prometheus seems to be a network of data centers located around New Albany, Ohio.

Meta’s AI data center build-out seems likely to make the company more competitive with OpenAI, Google DeepMind, and Anthropic in its ability to train and serve leading AI models. It’s possible the effort could also help Meta attract additional talent, who may be drawn to work at a company with the computational needs to compete in the AI race.

Together, Prometheus and Hyperion will soak up enough energy to power millions of homes, which could pull significant amounts of electricity and water from neighboring communities. One of Meta’s data center projects in Newton County, Georgia, has already caused the water taps to run dry in some residents’ homes, The New York Times reported Monday.

Other AI data center projects may cause similar problems for people living near them. AI hyperscaler CoreWeave is planning a data center expansion that is projected to double the electricity needs of a city near Dallas, Texas, according to Bloomberg.

Nevertheless, tech companies are determined to build out massive datacenter projects to power their AI ambitions. Other notable efforts include OpenAI’s Stargate project with Oracle and Softbank, as well as xAI’s Colossus supercomputer.

The Trump administration has largely championed the tech industry’s AI data center buildout. President Donald Trump helped OpenAI announce its Stargate project, and has since spoken about efforts to expand America’s AI infrastructure.

In a column featured in The Economist on Monday, U.S. Secretary of Energy Chris Wright called for the U.S. to “lead the next major energy-intensive frontier: artificial intelligence.” He noted that AI transforms electricity into the “most valuable output imaginable: intelligence,” and that the federal government would accelerate the production of energy derived from coal, nuclear, geothermal, and natural gas.

With the support of federal officials, the AI industry seems poised to soak up much of America’s energy in the years to come. Experts estimate that data centers could account for 20% of America’s energy consumption by 2030, up from just 2.5% in 2022. Without rapidly increased energy production, that could cause even more problems for communities.