Finance

China’s electric car market is headed for a sharp slowdown in 2025, according to analyst predictions, increasing pressure on companies trying to survive.
Strong sales volumes have enabled “strugglers and stragglers” to hang on despite falling margins, Yuqian Ding, head of China autos research at HSBC, said in a report last week.
China’s mix of subsidies and consumer purchase incentives have supported the rapid growth of new energy vehicles in recent years.

New electric vehicles destined for Belgium at a port in Taicang city in eastern China’s Jiangsu province on Jan. 11, 2025.
Future Publishing | Future Publishing | Getty Images

BEIJING — China’s electric car market is headed for a sharp slowdown in 2025, according to analyst predictions, increasing pressure on companies trying to survive.
Sales of new energy vehicles, a category which includes battery-only and hybrid-powered cars, surged last year by 42% to nearly 11 million units, according to the China Passenger Car Association. Market leader BYD’s NEV sales skyrocketed — up by more than 40% last year to nearly 4.3 million units, far above its internal target of at least 20% growth from 2023.

But looking ahead, HSBC analysts forecast only a 20% increase in China’s new energy vehicle sales this year, alongside heightened industry consolidation. They predict BYD unit sales growth of around 14%.
Strong sales volumes have enabled “strugglers and stragglers” to hang on despite falling margins, Yuqian Ding, head of China autos research at HSBC, said in a report last week. She pointed out that only BYD, Tesla and Li Auto made a profit in 2023.
“In our view, this situation is unsustainable and we expect the pace of industry consolidation to accelerate rapidly,” Ding said.

China’s mix of subsidies and consumer purchase incentives have supported the rapid growth of new energy vehicles in recent years.
Shenzhen-based laser display company Appotronics didn’t even have an autos business until it started making an in-car projector screen that began deliveries in China early last year. The company shipped more than 170,000 units last year.

But in a sign of a changing market, the company only expects similar volumes in 2025, Appotronics Chairman and CEO Li Yi told CNBC last week. He predicted the market wouldn’t pick back up until 2026.
“A lot of customers, the automakers, they’re not in a good financial state. They cut the R&D budget. That will definitely have a negative impact on this industry,” Li said, also noting overcapacity issues.
As automakers piled into China’s fast-growing electric car market, they began a price war in a bid to attract customers. Smartphone company Xiaomi launched its SU7 electric sedan last year at $4,000 less than Tesla’s Model 3, and with claims of a longer driving range.
“When BYD and Tesla cut prices, most rivals have little choice but to follow suit. This has clearly squeezed the overall profit pool in the auto industry, especially now that EVs have all the momentum,” HSBC’s Ding said, noting that BYD has a net profit margin of only 5%, less than the low teens for top automakers when the traditional fossil fuel car was at its peak.
NEV penetration of new cars sold had exceeded 50% by the second half of the year, association data showed.
Because of the high penetration rate, the growth rate of new NEV car sales will likely slow to 15% to 20% in 2025, according to Fitch Bohua analyst Wenyu Zhou and a team. They expect so-called smart features will increasingly become a major point of competition.
Automakers in China have increasingly turned to in-car entertainment features and driver-assist technology as ways to make their vehicles stand out.
While the electric car market moderates its growth, Appotronics plans to bring a 4K-resolution projector to cars in China this year, along with a screen that has better contrast and privacy features, Li said.
As for the longer term, the company intends to spend the next two to three years on developing new, laser-based uses for car headlights, Li said. He added the company is in talks with Tesla for a projector-type product in a next-generation vehicle, but could not say more because of a non-disclosure agreement. More

On November 25th the Elva, a tanker flagged in São Tomé and Príncipe, clandestinely picked up 2m barrels of Iranian crude off Malaysia’s coast. Sailing from there to north-east China, the vessel’s likely destination, usually takes two weeks at most. But not this time. On December 3rd, alleging the Elva had breached sanctions, America blacklisted the ship, exposing anyone dealing with it to punishment. Six weeks on it is still stranded less than 20km from where it collected its cargo. More

Cliff Asness, co-founder of AQR Capital Management, believes bitcoin is in a speculative bubble after the cryptocurrency’s swift rally carried it above $100,000 following the November presidential election.
Asness said there are three uses for crypto that he has identified: speculation, use in war-torn countries and paying cyber ransom.

Cliff Asness.
Chris Goodney | Bloomberg | Getty Images

Cliff Asness, co-founder of AQR Capital Management, believes bitcoin is in a speculative bubble after the cryptocurrency’s swift rally carried it above $100,000 following the November presidential election.
“I’m on the bubble side, on net,” Asness said on CNBC’s “Money Movers” on Monday. “To move me off that, you really need not a price change, but a use case. That’s what could convince me to become maybe more of a crypto person when I find any use for it, aside from speculation and criminality.”

Asness said there are three uses for crypto that he has identified: speculation, use in war-torn countries and paying cyber ransom.
Bitcoin rallied 120% in 2024 after a huge year-end pop on the back of President-elect Donald Trump’s election. Investors hoped Trump would usher in a golden age of crypto, including supportive deregulation of the industry and a national strategic bitcoin reserve. The digital coin has dipped 3% in the new year, last trading near $90,000.
“There’s no fundamental trend for crypto because I don’t know what the fundamentals are, but there is a price trend,” Asness said. “So I would guess most trend followers who have it in their universe are actually long.”

Stock chart icon

Bitcoin over the past year.

Although Asness is bearish on crypto, he noted that he would not bet against it due to its volatility.
“I wouldn’t short crypto only because shorting things with 100% annual volatility can be a little scary. I think we’ve all discovered what concentrated shorts can do to a portfolio,” he added.
Asness co-founded AQR in 1998 after a stint at Goldman Sachs. He and his partners established the quant-driven firm’s investment philosophy at the University of Chicago’s Ph.D. program, focusing on value and momentum strategies.

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Four states now levy an extra fee of $16 to $22.50 when consumers buy a new mattress or box spring. The fees help fund mattress recycling efforts.
Oregon launched its program Jan. 1. California and Connecticut raised their fees in 2025.
Other states are considering the programs, an example of “extended producer responsibility” laws to boost the circular economy.

Workers dismantling a mattress.
Thomas Lohnes | Getty Images News | Getty Images

Consumers in a handful of states are paying to help make the mattress industry more eco-friendly — and more states may follow suit?
Four states — California, Connecticut, Oregon and Rhode Island — now levy a flat fee on any mattress or box spring residents purchase online or in a brick-and-mortar shop.

The retail fees, which range from $16 to about $23, help finance state recycling programs that divert used mattresses from landfills — part of a growing policy initiative to boost the circular economy across common household items from plastic packaging to paper products and electronics.
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Americans discard about 15 million to 20 million mattresses each year — an average of 50,000 a day, according to the Mattress Recycling Council, a nonprofit formed by the bedding industry to operate state recycling programs.
Yet, more than 75% of a mattress is recyclable, according to MRC: its wood, steel, foams and fibers can be stripped, sold and reused.

Oregon implemented a recycling fee on Jan. 1. State residents who buy a new mattress or box spring pay an extra $22.50 per unit, reflected as a “stewardship assessment” on consumers’ receipts.

California and Connecticut raised their retail fees to $16 per unit at the beginning of 2025, up from $10.50 and $11.75, respectively. Rhode Island raised its per-unit fee to $20.50 last year.
The industry is also working with lawmakers in Massachusetts, Maryland, New York and Virginia to establish similar programs, according to MRC spokesperson Amanda Wall.

Recycling options are few but expanding

Douglas Sacha | Moment | Getty Images

There are currently few options for Americans who want to recycle a used mattress or box spring.
A directory compiled by the Mattress Recycling Council lists just 58 companies nationwide that recycle such products. Those in states that haven’t enacted recycling laws generally charge fees to consumers for drop-off and home pickup. (I recently paid $95 for such a service in New York City, for example.)
Oregon officials say their program will make it easy for consumers to recycle unwanted mattresses and reduce illegal dumping.
It aims to establish “new convenient locations in every county for residents to drop off their mattresses” and also create recycling sector jobs, according to the state’s Department of Environmental Quality website.

The state recycling efforts are examples of “extended producer responsibility” laws gaining traction in the U.S.
“With EPR, producers of products or packages become responsible for managing them when they become waste,” according to Reid Lifset, a resident fellow in industrial ecology at Yale University and editor of the Journal of Industrial Ecology. EPR programs provide a new source of funding to make the recycling system sustainable, Lifset said.
In the case of state mattress programs, retailers pass along the consumer fees to the Mattress Recycling Council to fund each state’s respective program, Wall said.
In Oregon, for example, more than half (about $12) of the $22.50 retail fee will fund program operational costs in 2025, with the remainder funding things like start-up costs, administration, and public education and advertising.
There are more than 300 mattress collection sites in states with recycling programs, according to MRC. The sites accept discarded mattresses at no cost. (They may charge for home pickup, however.)

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Almost everywhere, government-bond yields are rising fast. Those on ten-year American Treasury bonds are almost 5%. German bunds now offer 2.6%, up from close to 2% in December. Japanese bond yields are climbing. Things are particularly extreme in Britain, where gilt yields recently reached almost 5%, their highest since 2008 (see chart 1). Rising yields are bad news for governments, which must pay more to service debts. They are also painful for all sorts of other borrowers, including many mortgage-holders, whose bills ultimately depend on governments’ borrowing costs. More

An exchange-traded fund provider is helping investors make more bets on Wall Street’s most profitable momentum trades.
GraniteShares, which debuted its first installment of single-stock ETFs in 2022, now manages 20 of them. It includes the GraniteShares YieldBoost TSLA ETF (TSYY), which launched last month. The fund gives investors exposure to Tesla.

“This is about more and more people taking charge of their own finances,” GraniteShares CEO William Rhind told CNBC’s “ETF Edge” this week. “They want to be able to actively manage that and maybe try and outperform… That’s where we see things like leverage, single stocks really playing.”
He calls demand “a worldwide phenomenon” because it’s not just an opportunity for U.S. investors.
“We have investors all around the world that are looking to the U.S. ETF market first because that’s the biggest source of liquidity,” added Rhind. “They’re looking to the names that they know and love – the Teslas of the world [and] the Nvidias of the world. They’re only available here in the U.S., and that’s why people come here to trade them.”
But the firm acknowledges the strategy isn’t suited for everyone.
GraniteShares includes a disclosure in bold on its website: “An investment in these ETFs involve significant risks.”
As of Friday’s close, Tesla stock is nearly $100, or about 19%, off its all-time high – hit on Dec. 18.

Disclaimer More

Bitcoin was the top-performing asset class in 2024, rising about 125%. By comparison, the S&P 500 grew 23%.
However, investors should only own a small share of crypto due to its volatility — generally no more than 5% of total holdings, experts said.
Some think crypto doesn’t have a place in investment portfolios.
Investors should plan to hold bitcoin for the long term and dollar-cost average into it.

A bitcoin ATM in Miami. 
Joe Raedle | Getty Images News | Getty Images

Bitcoin prices soared in 2024. But you may want to tread with caution before euphoria leads you on a hasty buying spree.
Bitcoin and other crypto should generally account for just a sliver of investor portfolios — generally no more than 5% — due to its extreme volatility, according to financial experts.

Some investors may be wise to stay away from it altogether, they said.
“You’re not going to have the same size allocation in bitcoin as you would Nasdaq or the S&P 500,” said Ivory Johnson, a certified financial planner and founder of Delancey Wealth Management, based in Washington, D.C.
“Whenever you have a real volatile asset class, you need less of it in the portfolio to have the same impact” as traditional assets like stocks and bonds, said Johnson, a member of the CNBC Financial Advisor Council.

Why bitcoin prices increased in 2024

Bitcoin, the largest cryptocurrency, was the top-performing investment of 2024, by a long shot. Prices surged about 125%, ending the year around $94,000 after starting in the $40,000 range.
By comparison, the S&P 500, a U.S. stock index, rose 23%. The Nasdaq, a tech-heavy stock index, grew 29%.

Prices popped after Donald Trump’s U.S. presidential election win. His administration is expected to embrace deregulatory policies that would spur crypto demand.

A cartoon image of President-elect Donald Trump holding a bitcoin token in Hong Kong, China, on Dec. 5, 2024, to mark the cryptocurrency reaching over $100,000. 
Justin Chin/Bloomberg via Getty Images

Last year, the Securities and Exchange Commission also — for the first time — approved exchange-traded funds that invest directly in bitcoin and ether, the second-largest cryptocurrency, making crypto easier for retail investors to buy.
But experts cautioned that lofty profits may belie an underlying danger.
“With high returns come high risk, and crypto is no exception,” Amy Arnott, a portfolio strategist for Morningstar Research Services, wrote in June.
Bitcoin has been nearly five times as volatile as U.S. stocks since September 2015, and ether has been nearly 10 times as volatile, Arnott wrote.
“A portfolio weighting of 5% or less seems prudent, and many investors may want to skip cryptocurrency altogether,” she said.

1% to 2% is ‘reasonable’ for bitcoin, BlackRock says

Bitcoin lost 64% and 74% of its value in 2022 and 2018, respectively.
Mathematically, investors need a 100% return to recover from a 50% loss.
So far, crypto returns have been high enough to offset its additional risk — but it’s not a given that pattern will continue, Arnott said.

You’re not going to have the same size allocation in bitcoin as you would Nasdaq or the S&P 500.

Ivory Johnson
CFP, founder of Delancey Wealth Management

There are a few reasons for this: Crypto has become less valuable as a portfolio diversifier as it’s gotten more mainstream, Arnott wrote. Its popularity among speculative buyers also “makes it prone to pricing bubbles that will eventually burst,” she added.
BlackRock, a money manager, thinks there’s a case for owning bitcoin in a diversified portfolio, for investors who are comfortable with the “risk of potentially rapid price plunges” and who believe it will become more widely adopted, experts at the BlackRock Investment Institute wrote in early December.
(BlackRock offers a bitcoin ETF, the iShares Bitcoin Trust, IBIT.)
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A 1% to 2% allocation to bitcoin is a “reasonable range,” BlackRock experts wrote.
Going beyond would “sharply increase” bitcoin’s share of a portfolio’s total risk, they said.
For example, a 2% bitcoin allocation accounts for roughly 5% of the risk of a traditional 60/40 portfolio, BlackRock estimated. But a 4% allocation swells that figure to 14% of total portfolio risk, it said.

More ‘speculation’ than investment?

By comparison, Vanguard, another asset manager, doesn’t currently have plans to launch a crypto ETF or offer one on its brokerage platform, officials said.
“In Vanguard’s view, crypto is more of a speculation than an investment,” Janel Jackson, Vanguard’s former global head of ETF Capital Markets and Broker & Index Relations, wrote in January 2024.

Stock investors own shares of companies that produce goods or services, and many investors get dividends; bond investors receive regular interest payments; and commodities are real assets that meet consumption needs, Jackson wrote.
“While crypto has been classified as a commodity, it’s an immature asset class that has little history, no inherent economic value, no cash flow, and can create havoc within a portfolio,” wrote Jackson, now an executive in the firm’s Financial Advisor Services unit.

Dollar-cost average and hold for the long term

Ultimately, one’s total crypto allocation is a function of an investor’s appetite for and ability to take risk, according to financial advisors.
“Younger, more aggressive investors might allocate more [crypto] to their portfolios,” said Douglas Boneparth, a CFP based in New York and member of CNBC’s Advisor Council.
Investors generally hold about 5% of their classic 80/20 or 60/40 portfolio in crypto, said Boneparth, president and founder of Bone Fide Wealth.

“I think it could be a good idea to have some exposure to bitcoin in your portfolio, but it’s not for everyone and it will remain volatile,” Boneparth said. “As far as other cryptocurrencies are concerned, it’s difficult to pinpoint which ones are poised to be a good long-term investment. That’s not to say there won’t be winners.”
Investors who want to buy into crypto should consider using a dollar-cost-averaging strategy, said Johnson, of Delancey Wealth Management.
 “I buy 1% at a time until I get to my target risk,” Johnson said. “And that way I’m not putting 3%, 4%, 5% at one time and then something happens where it drops precipitously.”
It’d also be prudent for investors interested in crypto to buy and hold it for the long term, as they would with other financial assets, Johnson said.
Morningstar suggests holding cryptocurrency for at least 10 years, Arnott wrote. More

The fires that are burning through southern California may be shocking, but they are not surprising. Anyone who lived in the Hollywood Hills was aware of the danger. And for anyone who forgot, their annual insurance renewal provided a reminder at considerable expense. Such moments occasionally dampened the mood in the City of Angels. Now the promised catastrophe has arrived. More