The 17-year-old, who can not be named because of his age, is charged with causing the death by dangerous driving of Lesley-Ann McCarragher in Armagh.
The teenager was airlifted to hospital in Belfast but later died from her injuries.
The court heard the accused bought the white Saab on Friday.
On Saturday, a witness described seeing it being driven at speeds estimated at up to 90 mph.
The witness said it appeared to be racing a second car, believed to be a black Volkswagen Golf.
The police are still seeking that car and its driver.
A detective told Newry Magistrate's Court that the white Saab was undertaking another vehicle on the hard shoulder when it struck Lesley-Ann McCarragher.
The court heard that the 17-year-old initially denied owning the car when contacted by police on Saturday.
A detective revealed that the woman who had sold the car to the accused received a text from him on Saturday urging her to tell the police, if they asked, that she had sold the car to foreigners.
On Saturday evening, the accused handed himself into police and told them he had sold the car 45 minutes before the accident to foreigners at the side of the road.
The white Saab was later found in a garage rented by his brother.
The accused is also charged with failing to stop or report an accident and having no licence or insurance.
Objecting to bail, the detective said the woman who had sold the youth the car had told officers that she was scared of the accused and his family.
The court also heard that the accused had refused to hand over his mobile phone.
The magistrate said it was a case of "no phone, no bail" and adjourned the hearing while two police officers took the accused to retrieve the phone.
When the court sat again in the afternoon, a solicitor for the accused said an agreement had been reached for the phone to be handed over.
Bail was granted on condition that happens.
The accused will appear again in court later this month.
A teenager accused of killing a 19-year-old jogger in a hit-and-run incident claims he had sold the car involved 45 minutes earlier.