Intense competition in China's automotive sector persists, demonstrated by the introduction of advanced driving technology, despite a recent fatal accident.
Smart driving tech is the newest battleground in China's cutthroat auto market, with brands going head-to-head to establish world-leading innovations – but a recent deadly collision has prompted government action to slow down the breakneck pace.
Advanced driver-assistance systems (ADAS) take care of a range of tasks, from cruise control to parking and collision avoidance, with the ultimate goal being a fully self-driving vehicle.
Automakers are dumping money into these developments, particularly in China, the biggest car market on the planet, which has a youthful and tech-savvy population.
"A decade ago, only 15 percent of customers said they'd switch cars due to an intelligent dashboard – today it's 54 percent," Giovanni Lanfranchi of EV firm Zeekr stated.
Almost 60 percent of cars sold in China last year boasted level-two ADAS features or above, according to an AlixPartners report released recently. These systems offer continuous assistance while the driver remains in control.
The features are becoming a key competitive factor, said the consultancy's Yvette Zhang.
Some companies are using their own proprietary technology, like Xpeng and Xiaomi, while others are partnering with tech giants such as Huawei. The software is also being developed in Europe and North America.
In a survey of global auto executives by AlixPartners, two-thirds believed China led the world in this field. "The collection and processing of data, and the availability of software and machine-learning talent" is hard to replicate, the report said.
The technology isn't immune from the price wars that are standard in the Chinese market. In February, BYD, a domestic EV giant, announced it would make its "God's Eye" driving system available on nearly all its cars, including some models priced under $10,000.
This was followed by a fatal accident in March involving a Xiaomi SU7 that was in assisted driving mode before the crash. Three college students lost their lives.
The accident fueled concerns about safety and the advertising of cars as being capable of "autonomous driving." The issue isn't limited to one brand – Tesla's U.S.-released "Full Self-Driving" capability, for example, is still meant to be used when the driver is in control.
"The price war has been so brutal, companies are desperately trying to find ways to stand out," said Tom Nunlist, associate director for tech and data policy at Trivium China. "So the question is have they been over-promising on features and releasing things as quickly as possible, for the purposes of fighting this commercial battle?"
China's Ministry of Industry and Information Technology appears to share these concerns. After the crash, it held a meeting with leading automakers and other key players, assuring them that safety regulations would be enforced more strictly.
It advised automakers to thoroughly test systems, "define system functional boundaries… and refrain from exaggerated or false advertising." The ministry also plans to clamp down on the practice of improving ADAS through remote software updates.
As the massive auto show Auto Shanghai got underway last week, the shift in focus was evident. "In a sharp U-turn from just two months ago, carmakers have taken a low profile when it comes to autonomous driving functions, but are emphasizing safety instead," said UBS' Paul Gong in a note.
"Safety is the ultimate premium in new energy vehicles," a sign at BYD's booth read. At the bustling Xiaomi booth, displays touted the SU7's color choices, chassis, and hardware – but there was no mention of ADAS at all.
"The autonomous driving function marketing race seems to have halted, at least temporarily," wrote Gong.
Zhang Yu, managing director of Shanghai-based consultancy Automotive Foresight, told AFP that he thought the crash was "only a setback in marketing terms, which is helpful for a healthy development" of the technology.
"This accident was not related to tech or the system itself, it more concerns the ignorance of ADAS and boundary of autonomous driving," he added.
The technology itself continues to progress, but a truly autonomous vehicle – level five on the scale – is "certainly not imminent," according to experts like Trivium's Nunlist, who predict "very hard last-mile problems." However, under the new safety standards and regulations, the development will continue under standardized guidelines.
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China has intensified safety regulations for autonomous driving technology following the fatal Xiaomi crash and growing safety concerns. Key developments include:
Regulatory Crackdown on Autonomous Features
The Ministry of Industry and Information Technology (MIIT) has banned driverless functions such as valet parking, remote control, and one-touch summoning, emphasizing that systems must retain continuous driver oversight[1]. Hands-on requirements now mandate that driver monitoring systems cannot be disabled and must detect steering wheel contact, triggering slowdowns or emergency pullovers if hands are removed for over 60 seconds[1].
Standardization and Marketing Restrictions
Authorities are accelerating national safety standards for autonomous driving design conditions, automated parking, and emergency braking[2][4]. MIIT has criticized exaggerated marketing of autonomous capabilities and convened industry meetings to curb misleading promotions[3][5]. Over-the-air (OTA) updates now require regulatory pre-approval, with emergency updates treated as formal recalls[1][5].
Safety Concerns and Industry Impact
The regulatory push follows the high-profile fatal crash involving a Xiaomi EV, increasing scrutiny of driver-assistance systems[3]. Analysts warn these rules may dampen autonomous tech as a selling point for companies like Huawei, Xpeng, and Nio, while benefiting conservative manufacturers[1][3]. Level 2 autonomy remains dominant, requiring constant driver attention[3].
Stock markets reflect sector anxiety, with BAIC and Seres shares dropping sharply post-announcement[1]. Despite stricter oversight, experts predict continued technological development under standardized guidelines[3].
- The latest accident involving a Xiaomi vehicle has triggered government action in China, focusing on ensuring stricter safety regulations for autonomous driving technology.
- The Ministry of Industry and Information Technology (MIIT) has emphasized that autonomous driving systems must retain continuous driver oversight, moving to ban driverless functions.
- New hands-on requirements mandate that driver monitoring systems cannot be disabled, triggering slowdowns or emergency pullovers if hands are removed for over 60 seconds.
- The MIIT is working towards accelerating national safety standards for autonomous driving design conditions, automated parking, and emergency braking.
- The MIIT has criticized exaggerated marketing of autonomous capabilities and has convened industry meetings to curb misleading promotions.
- Over-the-air (OTA) updates now require regulatory pre-approval, with emergency updates treated as formal recalls.
- The high-profile fatal crash involving a Xiaomi EV has led to growing safety concerns in the industry, which could potentially dampen autonomous tech as a selling point for certain companies.
- While stricter oversight may impact some tech companies, experts predict continued technological development under standardized guidelines due to China's focus on safety in new energy vehicles.
