VW, BMW, and Mercedes are getting left in the dust by China's EVs

Ryan Xu was a dream customer for Germany's automakers. The Guangdong-based entrepreneur and her husband own a Porsche 911 and a Mercedes-Benz G-Class and were among the first buyers of the electric Porsche Taycan.

But her views on German cars have soured as Chinese consumers increasingly favor tech refinement over traditional selling points like horsepower and handling. The software systems in the Taycan, which costs well over $100,000, were "terrible," the 36-year-old mother of three said. It was "just an electrified Porsche - and that's it."

Her assessment isn't isolated. As China moves away from combustion-engine cars, Volkswagen AG, Mercedes-Benz Group AG, and BMW AG are struggling to offer electric vehicles that appeal to customers in their largest and most lucrative market, putting €35 billion ($38 billion) of investment on the line.