As demand grows from consumers to stay connected when in their vehicles, Chinese automakers are creating intelligent in-car systems to lead the still-nascent market. The commercial roll-outs of such projects are expected to boost the country’s flagging new energy vehicle sales, auto veterans said at TechCrunch Shenzhen 2019 on Tuesday.
China was again the world’s largest auto market in 2018, with more than 28 million vehicles sold. But less than 4% or about one million of these motors came with connectivity. “We believe the market will be mature once that number rises beyond three million units,” said Yang Dongsheng, general manager at BYD Auto Product Planning & New Technology Research Institute.
The Warren Buffet-backed EV maker launched DiLink, a system solution for connected vehicles, in April last year and later opened it up to app developers. The initiative provides them with access to 341 sensors and 66 controllers on each car to develop remote functionalities. Through a partnership with Baidu, the fully cloud-connected service also offers drivers the ability to monitor power consumption and more conveniently navigate to local charging stations.
“Smart connectivity is where differentiation is created to grasp the changing needs from consumers, and that is the key to leadership in the future market,” Yang added.
This message was echoed by Xpeng Motors, the young EV maker that today secured significant new investment from Xiaomi. The Alibaba-backed EV maker aims to be a frontrunner for future intelligent cars in the Chinese market. “Autonomous driving would completely disrupt the status quo of many traditional industries, … and we are enhancing our R&D capabilities to create greater driving enjoyment and convenience for customers,” said Brian Gu, vice-chairman and president of the company.
Gu added that the Guangzhou-based firm adopts a more cost-effective approach to vehicle autonomy based on an integrated solution involving cameras and radars, rather than a Lidar–based system that is currently not as economically viable on mass-market models. The company is on track to start deliveries of its first sedan model, the P7, at the beginning of the second quarter of next year. The model boasts a range of 600 kilometers (373 miles) and Level 3 autonomy, meaning a car could drive itself under certain conditions.
Hit hard by stalling sales since mid-2018, Chinese EV makers are embracing smart technology as they look for new potential sources of future growth. Auto sales fell again in October, this time by 5.7% year on year to 1.84 million units. The month extended China’s worst-ever prolonged fall in sales. What’s more, NEVs started to edge down since July this year. Consumers have been put off buying NEVs due to higher prices, range anxiety, and insufficient charging infrastructure.
Gu noted the previous industry boom was mainly driven by government support and it will take time to change consumer habits and popularize EVs. But just like in other consumer product tech sectors like PCs and smartphones, the EV industry is expected to hit a tipping point once penetration exceeds 10%.
“For NEV makers, more competitive offerings and better access to charging points are key to drive growth in the longer term,” Gu added.