Latest Developments Show That Chinese Firms Are Getting Interested in Autonomous Vehicle Technology

With recent investments from Xiaomi and Alibaba, China seems to prepare for market leadership in the autonomous vehicle industry.
autonomous vehicles

The last couple of years have triggered many conversations around autonomous vehicles and self-driving cars. According to Market Watch, the global autonomous vehicle market’s valuation stood at $54.21 billion in 2019. It predicts that the market valuation will increase to $2,055.93 billion by 2030, growing at a CAGR of 39.1 per cent between 2020 and 2030. 

However, the autonomous vehicle industry has also been facing a lot of criticism in recent years, primarily owing to potential safety issues. Not long ago, after Tesla’s Autopilot was identified causing at least 11 crashes since 2018, the US Government’s National Highway Traffic Safety Administration investigated 7,65,000 vehicles — almost all that Tesla sold in the US since 2014. 

Despite these criticisms, the autonomous vehicle industry seems to be a bright spot for industry leaders and investors alike. 


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Xiaomi bets Big 

Last week, in the latest developments, Chinese smartphone giant Xiaomi announced buying autonomous driving startup Deepmotion. According to media reports, the deal would be sealed at $77.4 million. 

This acquisition news comes right after Xiaomi overtook Apple Inc to become the second-largest phone vendor by shipments globally. The co-founder and CEO of Xiaomi would be spearheading the mission to take the company beyond smartphones. The tech giant plans to foray into the autonomous electric vehicle space, with Xiaomi promising to initially invest $10 billion in the project over the next decade. 

Interestingly, Deepmotion is a four-year-old Beijing-based startup that develops driver assistant software. It is the first of Xiaomi’s investment series to accelerate its plans to develop level 4 self-driving technology. To speed up its autonomous driving research and development, Xiaomi has also started hiring 500 engineers and is in talks with automakers for potential partnerships. Earlier, Xiaomi had also revealed its intention to invest in artificial intelligence chips developer Black Sesame Technologies. 

E-commerce Giant shifts Gears

Chinese e-commerce giant Alibaba invested an undisclosed amount in recently. The Shenzhen-based level 4 self-driving startup caters to OEM Tier 1 suppliers and ride-hailing and logistics companies. According to media reports, Alibaba has acquired a 19.68 per cent stake in– the first company to be granted a permit to operate self-driving cabs in Shenzhen. 

However, this move by Alibaba does not come as a surprise. The e-commerce giant had earlier announced that its logistics subsidiary Cainia was to develop self-driving trucks. Additionally, Alibaba has a stake in autonomous vehicle startup AutoX, which has already started testing self-driving vehicles in China. 

What’s in store? 

While these were just the two major recent developments in the autonomous industry, tech giants have been increasingly showing interest in this space. China’s telecommunication company Huawei Technologies and Chinese tech company Baidu Inc have spent years developing auto-driving components and technologies. Huawei intends on developing level 4 self-driving autonomous vehicles. 

Interestingly, all of these developments are coming into being at a time when China and the USA’s technology fight intensifies. Earlier this year, the Chinese government restricted the use of Tesla vehicles — a global major in the autonomous vehicle industry, by its military staff and key state-owned companies’ employees. The Chinese government cited security concerns as a reason for the bold move. It said that these autonomous vehicles could be a source of national security leaks. 

This move could direct China’s preparation to pull a face-off against USA manufacturers of autonomous vehicles and overtake headline maker Tesla. Whatever the reason, it seems to be a lucrative era for the autonomous vehicle industry. 

Interestingly, a study by North Carolina State University suggests that with regulated use, the deployment of autonomous vehicles can prove to be more useful than harmful. CEO of Tesla Elon Musk tweeted that autonomous vehicles engaging in autopilot were 10 times safer than an average vehicle. 

Overcoming the challenges associated with safety and security, the $809.15 billion industry is expected to further thrive and grow. 

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Debolina Biswas
After diving deep into the Indian startup ecosystem, Debolina is now a Technology Journalist. When not writing, she is found reading or playing with paint brushes and palette knives. She can be reached at

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