Innovations proposed to tackle industry's challenges

Auto executives have submitted proposals for advancing healthy development of new energy vehicles, autonomous driving and intelligent connected vehicles during this year's sessions of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference, tackling industry-wide challenges.

In 2024, China maintained its position as the global leader in automobile production and sales for the 16th consecutive year, with both exceeding 31 million units. The production and sales of NEVs surpassed 12 million units, ranking first globally for a decade. Behind these numbers, concerns such as intensified price wars and competition cannot be ignored.

Data reveals that the auto industry's profits declined by 8 percent year-on-year in 2024. The prices of over 200 new vehicle models were reduced, with an average price drop of 9.2 percent per vehicle.

Zhang Xinghai, chairman of Seres and a CPPCC member, said that China's NEVs are gradually becoming a global leader, a hard-won achievement that comes with challenges. Domestic competition is particularly fierce, spanning areas such as pricing, technology and even extending to ecosystem.

Zhang called for more industry self-regulation in the auto sector, emphasizing the need for orderly market practices and suggesting enhanced government oversight to improve the NEV industry.

Supported by 5G, big data and artificial intelligence technologies, the adoption of smart driving functions is increasing, with major automakers, including BYD, launching cheap models equipped with such functionalities.

The data shows that by mid-2024, more than 55.7 percent of NEVs had Level 2 advanced driver-assistance functions. The figure is expected to rise to 65 percent by 2025.

Zhu Huarong, chairman of Changan Automobile and an NPC deputy, suggested improving the standards and regulations for autonomous driving, including the delineation of liability in autonomous driving traffic accidents, insurance factors and market supervision.

Lei Jun, chairman of Xiaomi and an NPC deputy, noted that China is conducting on-road trials for L3 and progressing with L4 applications. To boost mass production and safety, it is crucial to accelerate testing, establish autonomous driving insurance and enact relevant laws swiftly.

Lei also proposed improving the design of NEV license plates to cater to the diverse preferences of young consumers. The green license plates for NEVs somewhat restrict the design effects of cars, he said.

He proposed optimizing the design of NEV license plates, conducting research on license plate styles, adding intelligent features and exploring new styles to boost car consumption and drive economic growth, which sparked significant responses from netizens.

He Xiaopeng, CEO of Xpeng and an NPC deputy, extended the scenario to parking lots. He suggested the evaluation and testing of unmanned low-speed parking and retrieval in parking lots under safe conditions, which can enhance efficiency and reduce risks.

He also called for the establishment of a specialized insurance system for autonomous vehicles and urged amendments to the road traffic safety law to provide a clear allocation of liability in incidents involving autonomous driving.

Another topic He proposed was in relation to eVTOL (electric vertical take-off and landing) aircraft, with a recommendation to expedite the development of an eVTOL pilot certification system, establish training requirements for traditional aircraft pilots transitioning to eVTOL aircraft and enhance eVTOL simulator standards.

Feng Xingya, chairman of GAC Group and an NPC deputy, emphasized the strategic importance of eVTOLs for China's low-altitude economy and their role in fostering high-quality growth in his proposal. He suggested cluster development, technology sharing, collaboration between industry and academia, and cross-departmental optimization to integrate eVTOLs with EVs.

eVTOL pilot projects are underway in some cities of Hefei, Hangzhou, Shenzhen, Suzhou, Chengdu and Chongqing. Financial services provider Morgan Stanley predicts that China's eVTOL market will grow from 43.4 billion yuan ($6 billion) in 2025 to 188.3 billion yuan in 2030 and is expected to reach 644.5 billion yuan by 2035, maintaining a market share of over 30 percent globally.

The recycling of power batteries is crucial for the high-quality development of NEVs, Feng noted.

By 2025, a peak in battery retirements is expected, with China anticipating over 1 million tons of retired batteries worth over 33 billion yuan, according to AskCI Consulting.

Despite a promising market outlook, challenges remain, including a low recycling rate of under 25 percent and inefficient recycling channels in China. Feng advocated for prompt regulatory standards, optimized industrial planning and enhanced regulatory measures to promote standardized operations and industry growth.