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China Urges Cautious but Rapid Development of Assisted-Driving Technology
China’s automakers are rapidly advancing assisted-driving technology, eager to capture a growing market. However, Beijing is pushing for a balanced approach—accelerate innovation but ensure safety and accountability.
Key Points:
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Rapid Innovation, Careful Oversight: Chinese regulators are finalizing new safety rules for driver-assistance systems following a fatal crash involving a Xiaomi SU7 sedan in March, which killed three occupants shortly after the driver resumed control from the system.
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Regulatory Approach:
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China bans terms like “smart” and “autonomous” in marketing to avoid overselling capabilities.
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Current rules allow automatic steering, braking, and acceleration only with driver engagement.
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New regulations will require hardware/software to monitor driver alertness and control readiness.
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Collaboration and Public Input:
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Regulators worked with Dongfeng and Huawei to draft rules, with public consultation ending recently.
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Plans to resume Level 3 validation tests this year after being paused post-Xiaomi crash; the first Level 3 vehicle approval expected in 2026.
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Level 3 Ambitions:
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Level 3 allows drivers to take eyes off the road under certain conditions—midway between basic driver-assist and full autonomy.
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China has promoted Level 3 tests and aims to be a global leader in assisted-driving tech.
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Industry Competition:
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China’s automakers like BYD and Zeekr are aggressively pushing Level 2 and Level 3 tech, often offering features at low or no additional cost.
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At the Shanghai auto show, Huawei and Geely’s Zeekr highlighted Level 3 readiness.
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Traditional foreign automakers like Mercedes-Benz and Volkswagen focus on advanced driver-assist features but hold back on Level 3 due to higher costs and liability concerns.
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Safety and Liability:
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New regulations hold manufacturers and suppliers liable for accidents caused by system failures, similar to recent UK legislation.
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Strategic Context:
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China is using this push to support its domestic auto industry, much like its earlier backing of electric vehicles.
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Over 60% of new cars sold in China this year are estimated to include Level 2 driver-assist features.
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Expert Insights:
Markus Muessig of Accenture Greater China notes that China’s “feel the stones to cross the river” approach—steady, cautious exploration of new tech—has been effective. Meanwhile, Mercedes-Benz’s CTO Markus Schaefer highlights the ongoing challenges with balancing cost and safety requirements for Level 3 systems.
Xiaomi Faces Backlash as YU7 EV Buyers Confront Year-Long Delivery Delays
Buyers of Xiaomi’s new YU7 electric SUV are voicing growing frustration after being told they may have to wait up to 60 weeks for delivery, despite paying a non-refundable deposit. The smartphone giant turned automaker received around 240,000 orders for the YU7 in the first 18 hours after sales opened last Thursday, but only a limited number of vehicles were available for immediate delivery.
By Tuesday, Xiaomi’s official app indicated wait times of 38 to 60 weeks, Reuters confirmed. More than 400 customer complaints have since been filed on the Sina Black Cat consumer complaint platform, with many saying they were unaware of the lengthy wait until after confirming their orders. Customers paid 5,000 yuan ($698) upfront and are now demanding refunds, citing concerns about EV tax exemptions expiring by year-end.
Xiaomi has not publicly responded, but CEO Lei Jun said he would address customer concerns in a livestream event on Wednesday via Weibo, where he has nearly 27 million followers.
The backlash mirrors earlier issues with Xiaomi’s first EV, the SU7 sedan, which debuted in March 2024. Though SU7 buyers initially faced seven-month delays, the car eventually outsold Tesla’s Model 3 in China from December onward. However, the SU7 brand image was hit by a fatal crash in March, and since then, Xiaomi has also faced complaints about unclear delivery schedules and optional feature configurations.
The YU7, Xiaomi’s second EV, is priced from 253,500 yuan ($35,360) — nearly 4% cheaper than Tesla’s Model Y, the best-selling SUV in China. Xiaomi has made clear its ambition to directly challenge Tesla’s dominance in China’s EV market.
To meet demand, Xiaomi is scaling up production at its Beijing factory, raising monthly output from 4,000 units in March 2024 to 28,000 in May, and is preparing to expand to two new factory sites nearby.
Still, unless transparency improves and production catches up, Xiaomi risks damaging its EV reputation — especially at a time when consumer trust and timely delivery are becoming major differentiators in China’s competitive electric vehicle landscape.