The definition of premium has changed, and its far off the price tag

German auto manufacturers’ luxury reputation in China is changing. Instead of obsessing over heritage and horsepower, Chinese consumers are now looking for high-tech, electric, and smart vehicles that don’t break the bank — and local automakers are delivering fast, putting a dent in a market long dominated by high-end German manufacturers, The New York Times reports.

The Xiaomi SU7 is a case in point: An electric sedan that’s got speed, breaking power, and most importantly, tech. AI-driven features like automated parking and personalized greetings are just the beginning. And here’s the kicker: it costs half as much as its German doppelganger, the Porsche Taycan.

The proof is in the numbers: Xiaomi sold over 100k units in its first year, whereas Porsche’s China sales nosedived 28% in 2024, dragging down global deliveries by 3%. That’s all due to the company’s choice to continue to cash in on its reputation rather than focus on innovation in a market that has shifted from valuing status symbols to smart tech and a plethora of features.

Prestige increasingly counts for less in the Chinese auto market. For decades, brands like Porsche have relied on their legacy to justify their price tags — but in today’s market, innovation beats prestige, with Chinese carmakers upping the ante with new features that outstrip their European counterparts.

The shift has revealed structural faultlines within Porsche’s broader business model. Declining Chinese sales numbers have hit Porsche hard, particularly given that German manufacturers have been increasingly reliant on the Chinese market to make up for faltering demand elsewhere. The company is moving swiftly to staunch the bleeding, having already parted ways with key executives in China and pledging to cut 1.9k jobs in the coming years. Potential US tariffs on European exports could complicate things further, though, with the company among the only German luxury auto manufacturers that supplies the US market with solely German-made cars.

For German carmakers, there’s no more resting on their laurels: “As German carmakers, we have to be at least as much or more innovative as we are more expensive,” Stefan Bratzel, director of Germany’s Center for Automotive Management, told the NYT. “And that has gradually been lost, because Chinese carmakers are now just as innovative, and some are even more innovative.”

Hackers have stolen about USD 1.5 bn in crypto tokens from crypto exchange Bybit, marking the largest crypto heist to date, Bybit’s CEO Ben Zhou told the FT. The move comes amid a wider resurgence in crypto interest that has been driven by the controversial embrace of the currencies by politicians like US president Donald Trump and Argentinian president Javier Milei.

How they did it: The hackers reportedly targeted Bybit’s cold wallet — an offline storage method that is considered more secure than the alternative online or “hot” wallet. Zhou confirmed that around 400k ethereum coins — the world’s third most-traded crypto coin — were taken, with the company still investigating how the wallet — which requires multiple signers to process a coin transfer— was compromised.

As one would imagine, the incident triggered a rush of withdrawals from Bybit. To mitigate losses, the exchange secured a bridge loan from its partners and promised to reimburse users for any irrecoverable funds.

This isn’t the only security challenge the crypto industry has faced. In 2011, a hack of crypto exchange Mt. Gox hack saw USD 470 mn lost to hackers, while a breach of crypto exchange Binance in 2022 resulted in USD 570 mn in losses. Years of advancements in security measures seem not to have deterred attackers, with this most recent heist signaling that large-scale crypto theft remains an issue.

The timing was not in the industry’s favor. Crypto has seen renewed interest since Trump’s election, with many expecting a looser regulatory environment in the coming period. Still, the incident is likely to give pause to many who had been mulling cashing in on crypto, putting a pin in the industry’s recent ebullience.