New York, USA.- China has already mastered electric vehicle technology. Now it also appears to have caught up with the West in the eventful race to automate driving.
After years of dashed hopes, enthusiasm around driver automation is once again taking flight. Elon Musk, Tesla’s chief executive, is largely to blame, as he has focused on the company’s driver-assistance technology as the best answer to its growth problems. Waymo, the self-driving taxi project from Google-owner Alphabet, has also shrugged off concerns caused by a high-profile accident at rival Cruise, controlled by General Motors. Waymo recently signalled its confidence by opening its doors in San Francisco to anyone who downloads the app.
But arguably more progress has been made in China, judging by the large number of companies with cutting-edge technology or close to it.
Baidu, the tech company often called China’s Google because of its search engine, has a self-driving taxi project similar to Waymo — and it’s not alone. Meanwhile, driver-assistance systems from Chinese EV makers such as XPeng, Li Auto and US-listed NIO are evolving rapidly.
XPeng, a pioneer in the technology in China, is rolling out an over-the-air update this month that will make its flagship autonomous driving package available on all public roads in China. Another company seen as a market leader is sanctioned tech giant Huawei, which integrates its system into vehicles made by other brands.
Users are reporting that XPeng’s flagship package, XNGP, has similar functionality to Tesla’s so-called “fully self-driving” (FSD) software. Both companies are betting on AI to make progress, rather than exhaustive mapping and coding. XPeng also appears to be following Tesla down the path of doing away with expensive lidar technology to sense the vehicle’s surroundings. The approach relies more heavily on cameras, but if it works it will improve the economics of commercializing the technology.
These are still only “Level 2” systems, according to the industry-standard classification, because they require constant supervision by a human driver. But Chinese regulators appear open to the crucial next step. Last month, China’s Ministry of Industry and Information Technology said it had granted approval to nine automakers, including electric vehicle giant BYD, to conduct “Level 3” automated driving trials on public roads. This means the human driver no longer needs to pay attention, subject to certain conditions, with the onus shifting to the automaker.
Mohit Sharma, an analyst at Counterpoint, a technology research firm, anticipates that China will dominate the rollout of Level 3 vehicles in the coming years. Mercedes-Benz and BMW are starting to sell highly conditional Level 3 systems in Germany, and the former has launched its system in the United States, but they are moving much more slowly than their new Chinese rivals.
Driverless taxis count as Level 4 technology, driving themselves without human supervision and without the speed or other restrictions that define Level 3. Because they are expensive to manufacture and operate within narrow geographic areas, their disruptive technology shows no signs of sparking an industry revolution. The shift from Level 2 to Level 3 in vehicles that consumers can actually buy is potentially more significant.
Tesla pioneered electric vehicle technology, but Chinese companies, led by BYD, are now taking the lead in commercialising it at scale. Something similar could now be happening with driving automation. Faced with a price war, Chinese EV brands are desperate to woo wealthier consumers with the latest gadgets. Beijing is more than happy to support the development of advanced technology.
In fact, Tesla may be one of the tools the Chinese government can use to help its domestic industry. Beijing expressed tentative support for FSD’s launch in China when Musk made a surprise visit to the country in April. Shares rose as investors anticipated software sales in the company’s second-largest market, where it currently sells only a limited version of its flagship driver-assistance package.
But China could also gain. Tesla will have to work with local partners like Baidu to do the mapping. It also seems likely that the US company will be required to keep its Chinese driving data, which is potentially valuable for training its autonomous driving system, in China.
Tesla’s construction of its Shanghai plant in 2019 is credited with jump-starting China’s electric vehicle supply chain, paving the way for its current dominance. A deal between Beijing and Tesla on FSD could also help close any remaining gaps in autonomous driving technology and even foster China’s AI ecosystem.
Original article edited by Stephen Wilmot / THE WALL STREET JOURNAL.
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