Posted originally on CTH on January 22, 2026 | Sundance 

It’s around lunchtime and I’ve spent so much time deep in the weeds of an issue that I need a break.  So, here’s a little funny story from my real-world travels in the past few years that given the current Davos meeting topics you might find interesting.

I went to Russia in 2024, because what I was hearing in western media about the sanctions did not align with what I was seeing from reports inside Russia.  Before I went into Russia, I spent several weeks in Northern and Eastern Europe visiting various institutions, reading material and checking to see how systems in Europe were engaging with commerce given the Russian sanctions.  It wasn’t very exciting work, and sometimes I literally just sat in the lobbies of banks listening to conversations.

When I went into Russia (April, May, June and July ’24) I noticed many of the “Uber cars” were BYD brand, Chinese electric vehicles.  It made sense given two years of existing sanctions and few cars from Europe or America available except under costly brokerage fees for acquisition.  They like the Geely brand better, but BYDs are much cheaper.  A brand new BYD costs around $5,000 to $10,000 USD, in some places even less.

Then later I noticed even more of these BYD cars in Europe.  I started to pay attention to them and saw them everywhere.

When I went back into Russia a year later in 2025, there was a very noticeable increase in BYD cars.  It was crazy, they were everywhere.

My travels also took me to southeast Asia and again those damned BYD’s were all over the place.  In Thailand, Philippines, Malaysia, Vietnam, these BYD’s were everywhere, maybe even 30% of total vehicle traffic at times – most certainly well over 50% of all EVs – and there are digital billboards for “Build Your Dream” (BYD) all over the place throughout Asia.

Australia is stocked full of those things, and the middle east, yup, even there too.  It became increasingly weird to notice.  So many were visible I was wondering how the heck China can mass produce and ship this many cheap EVs so fast.

Then as serendipity would have it, I ran into a Chinese guy, professionally an actuary, in a hotel restaurant.  He explained to me that China produces the BYD not to make money from the automobile, but rather to sell the carbon credits the automobile generates within the auto industry.

The actual value to Beijing is in selling the carbon credit worthiness to various automakers who are fined or penalized by their government for producing gasoline powered vehicles.

BYD is, in essence, not a car per se’, but a mechanism to generate a carbon credit certificate that can be sold to other car companies. It’s the carbon credit certificate that generates the revenue, not the sale of the vehicle.  As my dinner guest explained, the auto insurance industry was having fits about this because the actuaries couldn’t accurately put a correct figure on the cost of the insurance warrantee within the industry (that’s another story).

The bottom line is that China is manufacturing a product to create a carbon credit certificate in response to the demand for carbon credits from all the world auto-makers.  Any nation that has a penalty or fine attached to their climate goals is a customer. Those are nations with fines or quotas associated with the production of gasoline powered engines if the auto company doesn’t hit the legislated target for sales of electric vehicles.

In essence, EU/AU/CA/RU/ASEAN car companies buy Chinese car company carbon credits, to avoid the EU/AU/CA/RU/ASEAN fines.  The Chinese then use the carbon credit revenue to subsidize even lower priced Chinese EVs to the EU/AU/CA/RU/ASEAN car markets, thereby undercutting the EU/AU/CA/RU/ASEAN car companies that also produce EVs.

Big Panda brilliantly exploits the ridiculous pontificating climate scam and has an interest in perpetuating -even emphasizing- the need for the EU/AU/RU/ASEAN countries to keep pushing their climate agenda.  China even goes so far as to fund alarmism research about climate change because they are making money selling carbon credit certificates on the back end of the scam to the western fear mongers.  This is friggin’ brilliant.

My dinner buddy was in the business of identifying the cost/benefit equation between the climate change fines and the prices Big Panda could charge for the carbon credit certificates.   If, as an example, Brussels dropped the quotas for EVs, China would need to lower the price for the carbon credit certificates.  So, Beijing wants Brussels to make sure they don’t drop the quotas.  See how that works?

The climate change alarmists are helping China’s economy by pushing ever escalating fear of climate change.  You just cannot make this stuff up.

What does the outcome look like?

Well, in this example we see thousands of unsold BYDs piling up in countries that emphasize climate regulations with no restrictions on the import of EVs (which most don’t even manufacture), which is almost every country.  Big Panda doesn’t care about the car itself; they care about generating the carbon credit certificate to sell in the various carbon exchanges.

Put this context to the recent announcement by Canadian Prime Minister Mark Carney about his new trade deal with China to accept 49,000 EVs this year.

Prime Minister Carney bragged about getting the Chinese to agree to only super low prices for the Canadian market.  Mark Carney was very proud of his accomplishment to get much lower priced vehicles for Canadian EV purchasers.   No doubt Big Panda left the room laughing as soon as Carney made his grand announcement.

1. China sells EV’s in Canada, creating credits available on the carbon exchange scheme. Europe et al will purchase the carbon credits because Bussels has fines against EU car companies.

2. With a foothold already established in Europe, China will then take the money generated by the carbon credit purchases and lower the prices of the Chinese EV cars sold in Canada.

It’s gets funnier.

3. Carney bragged about forcing China to only sell low price EV’s as part of the trade agreement. The low price of the EV’s in Canada will be subsidized by Europe. China doesn’t pay or lose a dime.

But wait….

4. Carney can’t do anything about the scheme he has just enmeshed Canada into, because Canada has a Carbon Credit exchange in law. Big Panda wins again.

[…] In a statement published Thursday, BYD said sales of its battery-powered cars rose nearly 28% to 2.26 million units.

Musk openly laughed at the mention of BYD while being interviewed on Bloomberg TV in October 2011. He said he did not see the company as a competitor to Tesla, adding: “I don’t think they have a great product.” Meanwhile, Tesla said Friday it delivered 1.64 million vehicles in 2025. [SOURCE]

Elon thinks BYD are building cars.  They aren’t.