Autonomous systems on censorship. The cause of a drastic accident

The accident received wide media coverage. A Xiaomi SU7 car driving in autonomous mode crashed at 116 km/h on a highway in Anhu Province and burst into flames . The car doors did not open after the accident, preventing the passengers from escaping the burning car.

According to media reports, the car issued a hazard warning and gave up control to the driver less than 3 seconds before impact. According to Chinese government guidelines from September 2024, there should be at least 10 seconds between the car issuing a warning and the driver regaining control.

The Chinese are looking for a balance between innovation and security

Analysts say that establishing clear regulations for driver-assistance technology without slowing its development could give the Chinese industry an edge over global competitors, according to Reuters. The approach is in stark contrast to the U.S. market, where companies pursuing self-driving cars have expressed frustration that the government has not put in place a regulatory system to validate and test the technology.

Markus Muessig, head of automotive at Accenture Greater China, told Reuters that Chinese regulators and the industry have long followed former Chinese leader Deng Xiaoping’s philosophy of “feel the stones to cross the river,” a phrase that signifies a constant exploration of new, uncertain technologies that “have proven to be very effective in this market.”

The Chinese are allowing partially automated driving systems

Current Chinese regulations allow systems that automatically steer, brake and accelerate under certain conditions, while requiring constant driver involvement. For this reason, marketing terms such as “intelligent” and “autonomous” are banned. The new regulations will focus on hardware and software designs that monitor the driver’s state of consciousness and their ability to take control at the appropriate time.

To that end, regulators have turned to Chinese carmaker Dongfeng and tech giant Huawei to help draft the new rules.

Officials and manufacturers strive to achieve level 3

At the same time, government officials are pushing Chinese automakers to quickly deploy even more advanced systems, known as Level 3 driving assists, that allow drivers to take their eyes off the road in certain situations.

Level 3 is the midpoint on the industry's autonomous driving scale, from basic features like cruise control at Level 1 to the ability to drive independently in all conditions at Level 5. The Chinese government has chosen state-owned Changan to be the first automaker to begin Level 3 validation testing in April, a plan that was put on hold after the Xiaomi disaster.

Beijing still hopes to resume such testing this year and approve the country's first Level 3 car in 2026 , Reuters sources said.

Autonomous cars as a major market battlefield

Industry analysts see driver assistance systems as the next big battleground in China's ultra-competitive auto market.

Level 2 systems have proliferated in China over the past decade, including Tesla’s Full Self-Driving system and the Xiaomi feature implicated in the March crash. Capabilities range from basic following a vehicle on highways to performing most tasks on busy city roads under the supervision of a driver.

Automakers have reduced hardware costs to levels that allow them to offer Level 2 features at little or no additional cost. China's No. 1 automaker BYD has made its "God's Eye" driving assistance software free across its entire product lineup.

More than 60% of new cars sold in China this year will have Level 2 features, according to research firm Canalys.

In its pursuit of assisted-driving technology and, eventually, fully autonomous cars, Beijing is trying to help domestic automakers just as it has aided China’s rapid rise to become a global electric-car giant. Last year, the Chinese government organized public trials for nine automakers to speed up the adoption of self-driving cars .

Manufacturers to be held liable for accidents involving autonomous cars

As part of their push for Level 3, Chinese regulators are also raising regulatory concerns, holding automakers and parts suppliers liable if their systems fail and cause an accident.

Legislation passed in the UK last year took a similar approach to liability. At the Shanghai motor show in April, several companies boasted of progress towards introducing vehicles with Level 3 capability.

Tech giant Huawei said it is ready to introduce a Level 3 system for highways after simulated tests spanning more than 600 million kilometers, with a video showing drivers and passengers singing karaoke while the car drives itself.