2025: Majority of New Cars in China Will Be Equipped with L2 Self-Driving Capability

In a significant milestone for the automotive industry, approximately 15 million new electric vehicles (EVs) will hit the roads in mainland China this year, many of which will be equipped with preliminary autonomous driving features.

This shift comes as the cost of self-driving technology continues to decline, enabling both budget-friendly and premium models to incorporate some form of autonomous capabilities. According to industry experts, these vehicles will predominantly feature Level 2 (L2) autonomous driving technology, which can control steering, acceleration, and deceleration but still requires drivers to remain alert and ready to take control at any time.

Zhang Yongwei, General Secretary of China EV100, a non-governmental organization representing top executives from major Chinese EV manufacturers, emphasized that the level of intelligence in vehicles has become a critical battleground for automakers in China’s cutthroat automotive market.

The rise of autonomous driving is transforming the global automobile industry, as indicated by David Zhang, General Secretary of the International Intelligent Vehicle Engineering Association, who stated that mass production of advanced driver assistance systems (ADAS) is playing a crucial role in making these features more accessible to consumers in the world’s largest automotive market.

For example, in the evolving landscape of autonomous technologies, Uber’s CEO recently remarked that robotaxis are unlikely to replace human drivers until 2035, highlighting the ongoing development challenges facing the industry.

David Zhang, general secretary of the International Intelligent Vehicle Engineering Association said:

"Mass production of advanced driver assistance systems ADAS in the world's largest automotive market has enabled more Chinese consumers to get a taste of self-driving,"

"The rising adoption of intelligent cars marks a watershed in the global automobile industry."

L2 Autonomous Vehicles: A Growing Trend

The push towards autonomous driving in China is part of a broader trend, with predictions that by 2025, two out of every three new cars sold in the country will be equipped with L2 autonomous driving systems or more advanced versions.

Zhang further highlighted that mass production of ADAS is enabling more consumers to experience self-driving technology. The increasing adoption of intelligent vehicles marks a pivotal moment in the global automobile industry, as experts predict that this shift will reshape automotive markets worldwide.

The "Democratization" of Autonomous Driving

This year, Chinese manufacturers are set to revolutionize the autonomous driving market by introducing models with basic ADAS at prices below 100,000 yuan (approximately US$13,914). This is a significant departure from the norm, as most vehicles with ADAS in China have traditionally been priced above 150,000 yuan. Industry experts believe that this trend will lead to the "democratization" of high-end autonomous driving systems, with vehicles incorporating preliminary ADAS becoming increasingly affordable and widespread.

BYD, the world’s largest EV maker, has also developed plans to introduce cars priced under 100,000 yuan with preliminary ADAS, marking a new chapter in the widespread adoption of autonomous technology in China.

In addition, Paul Gong, head of China auto research at UBS, described this shift as the “democratization of high-end autonomous-driving systems” in mainstream vehicles. As carmakers race to outdo each other with innovative technologies, the competition has intensified, particularly as the cost of key components like lidar sensors has dropped significantly in recent years.

Autonomous Vehicles: Benefits and Challenges

The drive toward autonomous driving is not only changing the landscape for consumers but also presenting significant economic opportunities for Chinese companies. Analysts estimate that autonomous driving could save Chinese companies up to 1.8 trillion yuan in annual labor costs by 2030 as the adoption of driverless trucks gains momentum.

The government has been actively supporting this transition by investing in autonomous driving research and development, as well as striving to reduce logistics costs to improve the profitability of domestic manufacturers.

However, the technology is still in its infancy, and full autonomy remains a distant goal. In fact, the highest level of autonomy, Level 5 (L5), which would require no human intervention, is not yet achievable. Most intelligent vehicles in China are still classified as L2 or L2+, where the driver must remain alert and ready to take control if necessary.

Level 3 (L3) systems, which allow hands-off driving but still require human oversight, and Level 4 (L4) systems, which would allow drivers to disengage from driving entirely, are still in the early stages of development.

As this technology evolves, carmakers around the world are looking to China as a proving ground for the future of autonomous driving. For instance,

Tesla, known for its Full Self-Driving (FSD) system, has not yet received approval to test its technology in China. However, analysts expect the FSD system to undergo testing in China later this year. Currently, Tesla charges US$8,000 for the FSD package in the U.S., in addition to a US$99 monthly subscription.

The Future of Autonomous Driving in China

The rise of autonomous vehicles in China represents a transformative shift in the global automotive landscape. The introduction of L2 and L3 systems in vehicles priced at a fraction of what they once cost will likely drive demand and reshape consumer preferences.

With Chinese carmakers aggressively pushing the boundaries of autonomous driving technology, the country is poised to lead the way in this emerging field, setting the stage for more widespread adoption of self-driving technology worldwide.

Disclaimer: This article was originally published in South China Morning post (scmp)