NIO on July 26 gave updates on some of its most important technological developments, including the world’s first five-nanometer chip for automated driving, its in-house developed operating system for vehicles, and a voice assistant powered by its large language model.

Why it matters: NIO’s fullest disclosure yet of its technological roadmap reflects how the Chinese electric vehicle maker spends its research and development money, and how it has made a strategic bet on artificial intelligence, hoping to redesign all aspects of its vehicles including self-driving and the so-called digital cockpit.

Details: Speaking at the firm’s annual Tech Day event in Shanghai, NIO founder and chief executive William Li unveiled new details of what he called the world’s first five-nanometer (5nm) processor for autonomous driving, said to offer cameras with top-notch image signal processing (ISP) functions.

• The Shenji NX9031 system on chip (SoC) delivers high pixel throughputs of 6.25 Gigapixels per second, which NIO said makes it capable of capturing pictures with higher quality resolution in minimally lit environments, compared with flagship offerings from leading chipmakers.
• Li confirmed that the company had completed the tape-out for its self-designed autonomous driving semiconductor, which marks the end of the design phase and the beginning of production, without revealing which company has been contracted to produce it. 
• Meanwhile, NIO is on track to release its advanced driver assistance system, the Navigate on Pilot Plus (NOP+) 2.0, in the second half of the year. The Shanghai-headquartered EV maker is one of the Chinese players looking to harness the power of AI to provide cars with point-to-point navigation on Chinese highways, city streets, and parking spaces in a race led by Tesla.
• NIO also announced the launch of its proprietary operating system, the Sky OS, with which the company said it would have central control of all vehicle domains, allowing it to provide more advanced user experiences. An alternative to the open-sourced Linux OS and Blackberry’s QNX, the Sky OS forms the basis of the entire car all the way from vehicle control through to intelligent driving and infotainment, NIO said.
• This will enable a NIO vehicle to have a used battery pack exchanged for a new one fully automatically at one of the company’s nationwide recharging facilities, allowing the user to leave the car to get a coffee, according to vice president Wang Qiyan.
• The Chinese EV maker will also release its Banyan 3.0 in-car user interface through over-the-air updates in late August, featuring an enhanced version of its NOMI conversational assistant, powered by generative AI large language models (LLMs), for more human-like voice interactions. NIO owners will be able to request a chauffeur to drive them via voice commands, the company said.

Context: Only a few global chip powerhouses, such as Qualcomm and Ambarella, have announced the production of their chips using a 5nm process node with manufacturing partners such as Samsung. Tesla reportedly plans to produce its next-generation full self-driving (FSD) computer on 4/5nm processes with TSMC.

• NIO previously implied that its sophisticated chip could handle more than 1,000 trillion operations per second (TOPS), comparable to the combined total of four NVIDIA DRIVE Orin chips on 7nm, and is scheduled for mass delivery with the company’s ET9 executive sedan in early 2025.
• NIO’s research and development expenditures grew 23.9% annually to RMB 13.4 billion ($1.89 billion) last year. CEO Li told the event that the company has more than 11,000 R&D personnel, adding that its years-long efforts on in-house chip development will be “of great significance” to the industry of self-driving cars (our translation).

READ MORE: Chinese EV makers Nio, Xpeng, and Li Auto expand bets on self-produced chips: report

Individuals may be using the guise of selling second-hand air conditioners to buy and sell sexual services on the Alibaba-operated  second-hand goods and services platform Xianyu, according to app users who posted about an alternative use of the keyword “second-hand air conditioners” on Chinese X-like platform Weibo.

Chinese internet users have dubbed  Xianyu “yellow fish” since the case came to light, because “yellow” in Chinese can refer to pornography; users have also made fun of  Xianyu’s meaning,  “leisurely fish.” Xianyu’s customer service department responded on Wednesday that the team will enhance their review procedures to weed out such  transactions, according to a Sina News post on Weibo.

Why it matters: In China, the buying and selling of sexual services is illegal, prohibited under the country’s public morality and social order laws. This issue may reflect a misuse of online platforms, where individuals exploit legitimate categories to facilitate illicit activities.

Details: Terms such as “second-hand air conditioners,” “coins,” “Apple SIM card ejector,” and “Giant bike” have allegedly become code words suspected for selling sex on the online trading platform, according to comments posted on social media.

• A screenshot posted by a netizen shows a page from a seller on Xianyu purportedly listing a second-hand air conditioner in 90%-new condition, with a promise of home installation. In the background of the image is an air conditioner mounted on the wall, while the bottom left-hand corner features small photos of different women. The price displayed ranges from RMB 50 to RMB 600 ($7 to $83), though sellers can edit prices after transactions.
• According to a video posted on Weibo, a one-cent coin priced at over a thousand yuan actually relates to a sexual service, where the production year on the coin indicates the age of the sex worker. For instance, a coin from the year 2000 signifies that the sex worker was born in 2000.
• “Don’t ask why a pin tool is so expensive. Some things are not measured by value,” states the Apple SIM card ejector product description page in another example.
• Some Xianyu users looking to buy a second-hand Giant bicycle came across a local seller on the platform. However, the two sides engaged in a confusing conversation, according to screenshots shared on social media. The bike could be ridden for 90 minutes, the seller allegedly said, implying the duration of a sex service.

Context: Xianyu said its daily GMV (Gross Merchandise Volume) on the platform has exceeded one billion RMB ($138 million), local media outlet 36Kr reported in March. In the past year, over 100 million people posted items for sale on the platform, the company claimed.

• Digital products, ACG (anime, comic, game) products, tickets, vouchers, transportation tools, sports and outdoor equipment, and clothing have been among the top categories.

China- and US-based self-driving car startups Pony.ai and WeRide are ready for initial public offerings in the US, multiple media outlets have reported. The IPOs, which the firms have been eyeing for over two years, could happen as early as within the next two months.

Why it matters: Autonomous vehicle (AV) startups are generally facing pressure to lower their valuation targets as public stock markets have rapidly decelerated their interest in the space over the past few years.

• A group of 14 self-driving tech companies have seen their combined valuation decline more than 80% since their public debuts, according to an analysis by Crunchbase in 2022. Chinese car tech firm iMotion and lidar maker Robosense have lost roughly 75% and 90% in stock market valuation in the six months since their listings in Hong Kong.
• The potential listings of PonyAV.ai and WeRide, two of the highest-valued AV startups in China, will set the tone for many other companies trying to go public with their future-shaping technology, even as it takes longer than expected to become widely available.

Details: Fremont- and Guangzhou-based Pony.ai will go public as early as September, as some institutional investors have committed to purchasing shares in the looming IPO, financial media outlet Jiemian reported on Tuesday, without giving further details (in Chinese). WeRide is planning to sell its shares publicly in the US by the end of August, according to IFR, a Reuters publication.

• WeRide, with its China headquarters in the southern city of Guangzhou, last August received approval for an overseas listing from the China Securities Regulatory Commission, which requires applicants to complete the share sale within 12 months of the date of filing. Pony.ai gained a similar regulatory greenlight in April, Bloomberg reported. Pony.ai and WeRide declined to comment when contacted by TechNode on Thursday.

Context: Pony.ai reportedly suspended a public listing plan in New York at a target valuation of $12 billion in mid-2021 due to regulatory uncertainties. The Toyota-backed company said early the next year that it was valued at $8.5 billion after closing its first round of Series D financing, TechCrunch reported.

• WeRide, backed by the Renault-Nissan-Mitsubishi Alliance, filed confidentially for a US IPO aimed at raising as much as $500 million, Bloomberg reported last March. The company was valued at about $5.1 billion in a November 2022 fundraising round, according to its official website.
• Some other Chinese self-driving technology companies, including Horizon Robotics, Momenta, and Black Sesame, are rushing to sell shares publicly either in the US or Hong Kong as early investors are eager to earn money after incubating the companies for years, TechNode has learned.

The 142nd International Olympic Committee (IOC) Session was held in Paris on Tuesday, during which a proposal was approved for the first edition of the Olympic Esports Games to be held in Saudi Arabia in 2025. The IOC stated on its website, “history was made today.”

Why it matters: The Olympic Esports Games represents a major step in legitimizing and mainstreaming esports within the global sports community. The decision of the IOC acknowledges the increasing popularity and competitive nature of this rapidly evolving field.

Details: To organize the Olympic Esports Games, the IOC has entered into a 12-year partnership with the Saudi Arabian National Olympic Committee (NOC), according to the IOC announcement.

• Following the proposal’s approval, both parties are beginning the process to select the host city and venue for the event and finalizing details regarding the event schedule, disciplines, and qualification processes for the participants.
• At the same time, the IOC will establish a new, separate structure for the Olympic Esports Games, distinct from the Olympic Games’ organizational and financial model.
• “With the confirmation by the IOC Session of the creation of the Olympic Esports Games, we are keeping up with the pace of the digital revolution. The esports community, represented in our Esports Commission, has enthusiastically engaged with this initiative. This is further proof of the attractivity of the Olympic brand and the values it stands for among young people,” said the IOC President Thomas Bach.
• IOC member Reema Bandar Al-Saud, who serves on the Board of Directors of the Saudi Arabian Olympic and Paralympic Committee and as President of the Women’s Committee, stated that Saudi Arabia has over 23.5 million gamers, nearly half of whom are female. She said she views hosting the 2025 Olympic Esports Games as a natural progression in opening Saudi Arabia to the world.

Context: Last September, esports made its debut as an official competition event at the 19th Asian Games in Hangzhou, China. The competition included seven esports titles: League of Legends, Honor of Kings, PUBG Mobile, DOTA 2, Dream Three Kingdoms 2, Street Fighter V, and FIFA Online 4.

• On July 3, the first edition of the Esports World Cup kicked off in Riyadh, the capital of Saudi Arabia. Running until August 25, the event features 1,500 athletes from 425 clubs competing in 21 esports events for the honor of being crowned the first group of world champions.

Alibaba’s China-focused marketplace Taobao has joined the wave of Chinese e-commerce platforms launching cross-border operations with a plan to ship clothing globally for free. The platform will look to follow in the footsteps of the likes of Temu with an initial move to cover Asian territories including Hong Kong, Singapore, Malaysia, and South Korea.

Why it matters: The move illustrates Taobao’s efforts to tap into a broader global market while also engaging in competition with Pinduoduo at home.

Details: Taobao aims to reach Australian shoppers as early as the end of this year before expanding further afield. The program will look to attract Taobao merchants selling not only men’s, women’s, and children’s apparel, but also sports and outdoor clothing, as well as shoes and bags.

• Under the model, Taobao will heavily subsidize shipping fees, a strategy that Chinese companies frequently use when expanding overseas to challenge existing platforms embedded in local markets.
• Apparel merchants on Taobao can directly sell items to “billions of consumers worldwide” by joining the plan without the need for complex procedures, according to Taobao and Tmall Group.
• The program is set to adopt a so-called “half-fulfillment” model, which is also used by AliExpress and its counterparts Temu and Shein, supposedly liberating sellers from concerns about international logistics and delivery. 
• On the official application page, Taobao highlights “zero returns and zero refunds” as the biggest feature of the plan, sending signals to sellers that the platform will deal with any returns and further costs beyond the expense that merchants incur in sending items to Taobao’s China-based warehouses.

Context: Taobao sells items from numerous local clothing brands that its domestic rivals have no access to. Previously, people living outside China needed third-party transit resources to get items they bought from Taobao.

Chinese electric vehicle maker Zeekr on July 19 introduced a new iteration of its 009 multi-purpose vehicle (MPV), including a new variant that significantly lowers the starting price of the luxury minivan and aims to capture a growing customer base of affluent Chinese families.

The refreshed 009 is the latest example of how Chinese automakers are attempting to build their luxury credentials and change the perception of premium cars both domestically and globally. The Geely-affiliated company expects to set “a new benchmark” for MPVs after the Toyota Alphard, it said. The revamped 009 boasts improved performance and range, as well as a number of intriguing features with Chinese characteristics, such as a series of in-car guided meditations.

“Chinese middle- to upper-class customers are replacing their large SUVs [sports utility vehicles] with MPVs that are becoming easier to maneuver and steer,” Jason Lin, a Zeekr vice president, said in an interview with TechNode (our translation). Like peers Xpeng Motors and Li Auto, New York-listed Zeekr sees big growth potential for the booming segment thanks to innovations in vehicle capabilities.

China’s MPV sales grew 16% to roughly 1.09 million last year and accounted for 5% of total passenger car sales, figures from the China Passenger Car Association (CPCA) showed. Jefferies forecast the segment to grow 20% year-on-year to 1.3 million units this year, of which 32% could be electric, up by 10% from last year. The Zeekr 009 competes with other all-electrics including the Xpeng X9 and Li Auto’s Mega, more popular plug-in hybrid models such as the Denza D9, and the gas-powered Toyota Alphard and General Motors’ GL8 Century.

An expanded lineup

The redesigned 009 comes to market with more variants in the hope of meeting a diverse range of customer needs, as both six- and seven-seat configurations are now available in different drivetrain and battery options with a price range of RMB 439,000-469,000 ($60,363-$64,488). The six-seat, dual-motor versions help to distance the revamped 009 from its predecessors, offering the fastest acceleration to 100km/h (62 mph) among MPVs – in 3.9 seconds – and a charging speed from 10% to 80% in as little as 11.5 minutes, making it suited for business travel.

And yet, Zeekr expects the new single-motor, seven-seat variants, with a center aisle to facilitate easy entry and exit from the van’s rear, to extend its reach to cover wealthy Chinese families, especially multi-generational households, at a more affordable price tag. Around 55% of existing 009 sales come from business clients, although private owners could ultimately provide a larger market, according to Lin.

While CATL’s Qilin battery enables the same charging speed as the higher-end variants, the new entry-level 009 has a longer driving range of 740 kilometers (460 miles) between charges. That range could be further improved to 900 km with a larger battery pack to ease consumer anxiety over charging infrastructure at an additional cost of RMB 50,000, although it takes 30 minutes for the battery to charge from 10% to 80%. It has a slower sprint time of 0 to 100 km/h in 7.9 seconds compared with its siblings, but is still comparable to the Toyota Alphard, which costs RMB 890,000 in China.

Chinese-oriented features

Although the remodeled Zeekr 009 claims to present a prestigious option for Chinese families using a range of high-quality interior materials and top-notch components, the company is also pushing hard to offer customized features with local characteristics to differentiate its vehicles from competitors. For instance, it offers a special chill mode with the car’s seats, lights, and music tailored to create an in-car environment for guided meditation, allowing owners to take a basic course with a series of video classes.

Other special modes include “Baby Sleeping”, for when younger family members take a nap, which automatically adjusts the air-conditioning and lights and turns down the volume of voice prompts. Some of the more traditional, upscale features that come standard with the car are air suspension that eliminates bumps for superior handling and ride quality, as well as Qualcomm’s latest-gen Snapdragon 8295 chips that enable the infotainment system with silky smooth transitions and fast responsiveness.

The all-new 009, set to be delivered on Monday, comes less than two years after the initial launch of Zeekr’s second model and follows an update in January, when two 2024 versions went on sale at a starting price of RMB 500,000. Zeekr is also selling the right-hand drive version of the luxury van in Hong Kong at HK$ 755,000 ($96,716) and aiming for delivery in the city in the fourth quarter of this year. The company launched a special Grand edition, targeting competition with the Rolls-Royce Cullinan in April.

TSMC on Thursday announced its financial results for the second quarter of 2024, reporting a 40.1% year-on-year revenue increase. The Taiwan-based chip foundry also stated that it has raised its full-year revenue and capital expenditure targets for 2024. The firm’s earnings call was also remarkable for TSMC CEO C.C. Wei introducing the new concept of “Wafer Foundry 2.0” for the first time during his comments to investors.

Why it matters: TSMC’s introduction of Wafer Foundry 2.0 signifies a strategic expansion beyond traditional wafer manufacturing. The move aims to capitalize on emerging market opportunities and meet the growing complexity of semiconductor production.

Details: TSMC said the idea of Wafer Foundry 2.0 is intended to better leverage its advanced packaging capabilities for market expansion by encompassing a wider range of activities compared to the traditional wafer manufacturing industry.

• As chip manufacturing becomes increasingly complex, wafer foundries have evolved beyond simple wafer manufacturing services. Wafer Foundry 2.0 was unveiled during TSMC’s second quarter earnings call, during which Wei redefined the foundry industry to include packaging, testing, mask-making, and IDM (Integrated Device Manufacturer) operations.
• Wei also noted that demand for TSMC’s 3nm and 5nm process technologies remains strong. As the company enters the third quarter, the demand for advanced processes driven by smartphones and AI opportunities has slightly raised its full-year revenue forecast for 2024, increasing the expected growth range from 21%-26% to 24%-26% year-on-year, he said.
• TSMC has also raised its 2024 capital expenditure budget from $28 billion-$32 billion to $30 billion-$32 billion. Of this, 70% to 80% will be allocated to advanced process technologies, 10% to 20% to special process technologies, and 10% to advanced packaging, testing, and mask-making, the company said.
• In the second quarter, TSMC reported revenue of NT$673.51 billion ($20.56 billion), a 40.1% increase year-on-year and a 13.6% rise quarter-on-quarter. Net profit was NT$247.85 billion ($7.57 billion), up 36.3% from the previous year and 9.9% from the previous quarter.
• In terms of revenue distribution by process technology, TSMC’s revenue from advanced processes of 7nm and below reached 67% in the second quarter. The firm’s 3nm process revenue accounted for 15% of this total, largely due to the launch of Apple’s A17 Pro series processors last year, as well as its M4 series processors and the upcoming A18 series processors this year.
• By end-use application, the revenue breakdown is as follows: high-performance computing accounted for 52%, smartphones for 33%, IoT for 6%, automotive electronics for 5%, consumer electronics for 2%, and others for 2%.

Context: Apple has secured the first batch of TSMC’s 2nm production capacity, expected to start trial production soon. The new chips, debuting in the iPhone 17 series, may boost performance by up to 15% and cut power consumption by 30% compared with the 3nm process.

On Wednesday, ASML released its financial report for the second quarter and stated that the period’s sales of 6.24 billion euros ($6.82 billion) exceeded the company’s expectations, even though overall net sales declined compared to the same period last year. 

Despite geopolitical uncertainties and restrictions on chip-related exports from the Netherlands to China, demand for ASML equipment in the Chinese mainland market remained strong, accounting for 49% of the Dutch company’s net system sales in the second quarter.

Why it matters: ASML’s revenue was impacted in the previous two quarters after the Dutch government’s chip-making equipment export restrictions took effect last September, and ASML’s export license expired at the end of 2023. Demand in the Chinese mainland market has now primarily shifted to unrestricted DUV (deep ultraviolet lithography) equipment.

Details: ASML reported mixed financial results for the second quarter, with a 7.6% year-on-year decline in net sales but an 18% increase from the previous quarter. On the same day, their US-listed shares dropped 13% due to reports that the US is considering even stricter rules around chip-related exports to China.

• In the second quarter of 2024, ASML achieved net sales of 6.24 billion euros ($6.82 billion), a decrease of around 7.6% from the 6.75 billion euros ($7.38 billion) it reported for the same period last year, though the figure marked an increase of around 18% compared to the first quarter of 2024’s 5.29 billion euros ($5.78 billion), according to the report.
• In terms of regional breakdowns, mainland China continues to be ASML’s largest market, with mainland Chinese net system sales accounting for 49% (2.33 billion euros, equivalent to 2.55 billion dollars) of the company’s total. This proportion remains consistent with the first quarter, reflecting a 20% increase from China’s 1.94 billion euros ($2.12 billion) in the first quarter of this year.
• “Gross margin for the quarter came in at 51.5%, which was above our guidance, primarily driven by more immersion systems than planned,” CFO Roger Dassen said on an ASML investor call. Dassen added that the company expects total net sales for the next quarter to hit between 6.7 billion euros ($7.32 billion) and 7.3 billion euros ($7.98 billion), with R&D expenses estimated at around 1.1 billion euros.
• “Although macro uncertainty remains, overall semiconductor inventory levels continue to improve, trending towards more healthy levels,” ASML CEO Christophe Fouquet said during the same investor call. The company’s outlook for the full year is unchanged with revenue expected to be similar to last year, he added.
• US-listed shares of ASML slumped 13% following a Bloomberg report on Wednesday that the Biden administration is considering tougher restrictions to limit companies exporting critical chip-making equipment to China.

Context: On June 30, 2023, the Netherlands announced new export controls on the sale of advanced chip-making equipment to China, which took effect on September 1 that year. The rules require Dutch manufacturer ASML to apply for a license to ship some of its deep ultraviolet lithography (DUV) systems to China.

• In the first quarter, ASML sales revenue was 5.29 billion euros ($5.78 billion), down from 6.7 billion euros ($7.32 billion) during the same period last year.

Autotech startup Nullmax said on Tuesday that its latest generation of autonomous driving hardware and software package, allowing cars to navigate complex urban environments autonomously with features such as lane changing, will cost users as little as “several thousand RMB.” 

Why it matters: Shanghai and Fremont-based Nullmax is among the few players in the self-driving vehicle space claiming that cars will be able to function by themselves in urban scenarios without maps and lidar. Instead, the company said artificial intelligence models can be used to enable cars to navigate from points A to B.

• This makes its system even more cost-competitive on the Chinese market compared with Tesla’s Full Self-Driving (FSD) software, chief executive Xu Lei told reporters in Shanghai. Tesla has reportedly partnered with Baidu to leverage the latter’s lane-level navigation and standard definition mapping services, as part of its push to localize its most advanced driver-assistance software (ADAS) in the country.

Details: Xu told a press conference that his company is advocating a “pure vision” and “end-to-end” approach, as Tesla has been doing and many are following its lead, which involves deep neural networks, using cameras only to perform autonomous driving functions (our translation).

• The car could complete the highway on-ramp to off-ramp maneuver and drive through a construction zone in Chinese urban areas with affordable hardware of 7-11 cameras and a computing platform that can handle roughly 100 trillion operations per second (or TOPS), according to Nullmax.
• Xu expects some car models equipped with the technology to come to market in 2025, without saying more. Nullmax, with roughly 300 scientists and engineers, has been developing more safety-based ADAS functions for domestic automakers SAIC, and Chery, among others, TechNode has learned.
• Cars powered by Nullmax’s tech have traveled a combined 10 million kilometers (6.2 million miles). Xu added more actual driving data is required to provide cars with point-to-point navigation on city streets, while the company is training the ADAS system via simulation with AI-generated data.

Context: Chinese EV startups led by NIO, Xpeng Motors, and Li Auto have been ramping up efforts to transition from “rule-based” designs to an “end-to-end” autonomous driving method. Meanwhile, traditional car manufacturers are tapping into the power of AI by working with tech giants such as Huawei and NVIDIA, as well as startup unicorns like Horizon Robotics and Momenta.

• “What we see in the future is that the (AI-defined) AV stack will become an end-to-end model and will be trained in the cloud with massive data. More importantly, it will be validated in the cloud with simulation capabilities as well,” said Wu Xinzhou, NVIDIA’s vice president of automotive at its annual developer conference GTC in March.
• The US chipmaker in late 2021 released a system called “Omniverse Replicator” to facilitate the training of autonomous vehicles in the virtual world, Reuters reported. Chinese major EV makers, including BYD and NIO, are building their ADAS upon its DRIVE Orin computers, each of which offers 254 TOPS of performance.
• Nullmax was co-founded in 2016 by Xu Lei and Justin Song, both of whom spent time at Tesla. Xu worked on Tesla’s Autopilot computer vision team in 2015 and 2016, after leaving a senior engineering role at Qualcomm, while Song was responsible for engineering the Tesla Autopilot and car infotainment system from 2012 to 2015, according to their LinkedIn profiles.

READ MORE: Former Tesla engineer shares thoughts on end-to-end autonomous driving at WAIC 2024

Editor’s note: ‘Landing AI’ is a series of special reports focusing on the field of Artificial Intelligence curated by TechNode. By investigating the development of AI landing in China and the behind-the-scenes stories of the industry, we’re going to dive deeper into everything that’s possible under the new wave of AI.

Chinese bubble tea chain Chagee has reportedly hired Li Tao, vice president of Starbucks China, paving the way for the rising brand’s further expansion, according to local media outlet 36Kr. However, the report was quickly denied by the company.

Founded in 2017, the bubble tea maker has found widespread success in China’s crowded ready-to-drink beverage industry through its addition of fresh milk to raw-leaf tea.

Why it matters: The reported move comes as Chagee mulls a US listing to widen its access to financing.

Details: The 36Kr report added that Chagee is also looking at hiring professionals from rivals such as Tims China (Tim Hortons’ China offshoot), while attempting to lure marketing staff from social media platform Xiaohongshu and tech giant Huawei.

• Chagee founder Zhang Junjie has set a goal of surpassing Starbucks China in terms of sales volume in 2024. In the first quarter of this year, Chagee made more than RMB 5.8 billion in gross merchandise value (GMV), slightly exceeding half of its total sales for 2023, Zhang told the public in May.
• For the same three-month period, Starbucks recorded a decline in both revenue and net profit, with earnings landing at $706 million, approximately RMB 5.1 billion. 
• Although Chagee has kept silent on its profit figures, local media outlet LatePost reported in May that the company earned a net profit of between RMB 800 million and RMB 1 billion in 2023, versus a loss around RMB 48 million on RMB 500 million revenue a year prior.
• Beverages are mostly priced at around RMB 20 ($2.75) at Chagee, the fourth-largest Chinese to-go beverage chain. Zhang recently revealed that the brand sold over 230 million cups of one of its flagship products, a jasmine green milk tea, in 2023. Chagee tends to use ancient Chinese idioms to name its beverages; the aforementioned jasmine drink is named with a four-character idiom that translates to “the difficulty of finding a soulmate.” The name alone doesn’t give buyers an immediate idea of the drink’s ingredients.

Context: The past 18 months has been a period of wild expansion for Chagee, which opened more than 3,500 new stores in 2023. It took the chain more than five years to open its first 1,000 stores and it has over 4500 in total as of May.

The Chinese government on July 12 announced it had given Xiaomi a production license to independently assemble electric vehicles, meaning the smartphone maker has cleared the official hurdles required to scale up its production independently, without needing its traditional car manufacturer ally BAIC.

Why it matters: The green light from Chinese regulators will pave the way for a smooth production ramp-up for Xiaomi, which has raised its delivery target to 120,000 from 72,000 units for this year and hopes to reach a wider customer group with upcoming models.

Details: Xiaomi is now on the list of “all-electric passenger car manufacturers,” according to the registration filings released for public review by China’s Ministry of Industry and Information Technology (MIIT) on July 12 (our translation).

• Xiaomi also updated the filing for registration of its first consumer car, the SU7, to the country’s top industry regulator, with the model carrying the “Xiaomi” name on its rear, rather than “Beijing Xiaomi” as previously shown, the photos revealed by MIIT show.
• The popular sedan has always been manufactured at Xiaomi’s factory in the Beijing Economic and Technological Development Zone, but its production application had earlier been filed in the name of a subsidiary of state-owned automaker BAIC, TechNode reported.
• The company had been waiting for final approval from MIIT after getting the nod from China’s state planner to manufacture EVs, Reuters first reported last August, while reportedly looking for a partner to produce its second model. Its Beijing plant can turn out 150,000 cars a year.

Context: Xiaomi reached the 10,000-unit milestone in June, its third delivery month, bringing the year-to-date delivery volume of its answer to Tesla’s Model 3 to nearly 26,000 units.

• President Lu Weibing told investors in May that the company is aiming to deliver 120,000 cars this year. This is far higher than the firm’s original target of 72,000 units revealed by chief executive Lei Jun at Xiaomi’s annual investor day in April, CNBC reported.
• Priced from RMB 215,900 ($29,881) with styling similar to the Porsche Taycan, the all-electric Xiaomi SU7 has become a success in China, securing 88,898 pre-orders in the 24 hours following its launch on March 28. The company has since been under pressure to ensure timely delivery.
• The tech giant is also rushing to introduce its second car, an all-electric sports utility vehicle, in the first half of next year, while a third model is said (in Chinese) to be an extended-range hybrid (EREV) targeting Chinese families, and is scheduled for release in 2026.

READ MORE: “China’s Apple” Xiaomi takes aim at Tesla with debut EV launch, as millions watch online

Chinese automakers will over time become a dominant force worldwide despite the US and Europe imposing extra duties on their electric vehicles, consultants AlixPartners said on Wednesday, highlighting that China’s vehicle makers are on track to grab over 30% of the global market by 2030.

Chinese brands’ market share in Europe is unlikely to reach the previously anticipated percentage of 15% by 2030, as forecasted a year ago, instead doubling from 6% to 12%, but stronger growth is expected in other regions. Chinese brands could claim market shares 31% and 28% in Southeast Asia and Latin America respectively by the end of the decade, up from the 19% in each estimated last year, figures from the consultancy’s annual Global Automotive Outlook showed.

Many Chinese auto majors have pivoted their focus to overseas markets beyond the EU in recent months, taking advantage of fewer regulatory barriers in, for example, Southeast Asia and the Middle East. Geely subsidiary Zeekr plans to expand its footprint from 25 to more than 50 global markets by the end of this year, despite retaining “very big ambitions” for Europe, executives told investors last month. Great Wall Motor is shutting down its European headquarters in Munich, Germany, but says it still has plans to set up a factory in the region.

“Chinese automakers will definitely lose some competitive edge in EVs as they move to implement localized manufacturing and sales operations in Europe,” Stephen Dyer, a co-leader for AlixPartners’s Greater China business and head of its Asia automotive practice, told reporters on Wednesday in Shanghai. “However, they still have cost advantages over foreign competitors thanks to a shortened vehicle development time, a much lower labor cost, along with an intense corporate culture,” Dyer added, speaking in Mandarin Chinese (our translation).

An employee from a Chinese EV maker works as many as 140 hours in a month when a new car is launched, compared with only 20 hours worked by a counterpart at a global auto major, AlixPartners told clients in its latest outlook. Meanwhile, the average vehicle development time for a Chinese EV model has been cut in half to 20 months compared with legacy brands, mainly by reducing the number of physical tests and sending out software updates to fix problems.

The European Union’s additional tariffs on Chinese-made EVs are forcing Chinese majors to set up their own assembly operations on the continent. BYD on July 4 opened its first overseas passenger car factory in Thailand while planning to invest $1 billion in another one in Turkey and to establish a $30 million battery plant in Hungary. Chery in April reached a joint venture deal with Spain’s EV Motors to produce cars at a former Nissan plant in Barcelona later this year, Reuters reported. At least 12 new regional plants are being planned by Chinese car manufacturers, Dyer said.

“What we see is we’ve had a brand premium that is comparable to or even slightly more than global automakers in some overseas markets, such as Southeast Asia,” Wang Hui, a vice president of Changan Automobile, told this year’s China Auto Forum in Shanghai on Friday (our translation). The state-controlled automaker last October announced plans to build a $241.7 million plant in Rayong, Thailand, aiming to commence operations later this year with a capacity of 100,000 EVs annually. 

Wang added that Chinese firms should take a long-term mindset of “being humble and cautious” while making efforts to increase tax revenue and boost job growth for the local economies in where they operate.

READ MORE: EU anti-subsidy EV probe: What Chinese automakers have done in Europe and what’s next

Since Chinese game developer miHoYo released Zenless Zone Zero, a new action role-playing game (RPG) populated with rogue-like elements last Thursday, the reviews from Chinese players have been mixed. Online communities have seen comments praising its combat mechanics and visual design, but others saying the game is somewhat unengaging. 

As the developer of hit game Genshin Impact and Honkai: Star Rail, miHoYo has caused a stir in the domestic gaming industry with this new release. Less than three days after the game became available to the public, the Shanghai-based firm announced that global downloads had surpassed 50 million, thanking players by distributing in-game rewards.

The free-to-download game is available on Windows, iOS, Android and PlayStation 5, with future versions planned to launch on Switch and Xbox, though there are no confirmed release dates for the latter.

We spent eight hours playing the game to give readers a comprehensive review.

Game background

In the environs of a post-apocalyptic metropolis called New Eridu, the last humans to exist live in a place called Hollows, where monsters roam. New Eridu thrives by extracting resources from Hollows, leading to conflict between monopolistic enterprises, gangs, and conspirators. Players take on the role of a Proxy, a group that links the Hollows and New Eridu.

As players progress in the Hollows, the Proxy recruits new members to their party as they continue to fight the roaming monsters. By combining the abilities of different members in the game, players can cause greater damage and have greater impact on their enemies.

Beautiful visuals and hard-hitting music

Zenless Zone Zero’s visual effects and camera movements are smooth, and the story animations are fluid, in a similar style to Japanese manga.

The game simplifies action elements, making it easy for beginners to pick up, while containing many intricate details for veteran players to master. It employs a three-character team for diverse combat strategies, an intriguing choice when first playing. Players can switch to another character during the battles for an enhanced hitting score, if they seize the right moment.

The game’s visual design has gathered widespread acclaim, especially for its stylized street fashion. Character design and game scene details are so rich I would give them a score above 9 out of ten. The music and sound effects are also fantastic, with high-quality music featuring electronic melodies and high-BPM (Beats Per Minute).

Plodding storylines and mediocre gacha animations

The storyline and dialogue of Zenless Zone Zero occasionally prompted me to speed through them, and may be more appealing to younger players. Meanwhile, the hitting impact sensation during battles is better on a PC, leaving plenty of room for improvement on the mobile version.

Gacha refers to a game mechanic whereby players spend virtual currency (in-game purchases) to receive random in-game items or characters, similar to toy vending machines, often seen in miHoYo’s mobile games. This is a gacha animation screenshot:

The gacha animations in this game are mediocre, and come nowhere near those of Genshin Impact, a game the tester played for two years. Additionally, compared to Genshin Impact, the character pool isn’t very appealing, and there were no characters I felt compelled to invest in.

The tester spent four hours experiencing the game on both mobile and PC. Currently, the variety of monsters in battles is rather limited, which could stifle extended play.

As the game is essentially a gacha pay-to-win system, and due to limited testing time, it could be that we’re yet to uncover its full complexity. However, from a beginner’s perspective, the overall gaming experience falls short of that of Genshin Impact.

Pros: 

• Unique combat experience
• Smooth artistic visuals
• Beginner-friendly mechanics
• Acclaimed music

Cons: 

• Bland storyline and dialogue
• Mediocre hitting sensation on mobile devices
• Characters and gacha animations less appealing than Genshin Impact
• Limited monster variety in battles

Conclusion:

Zenless Zone Zero shows great potential but needs further improvements to captivate players long-term. It doesn’t quite measure up to Genshin Impact, especially in the gacha mechanics, a crucial area that has earned billions of dollars worldwide for the company through its other hit titles.

The game’s greatest strength is its art design, making it satisfactory as a mobile game. However, given four years of development and the success of Genshin Impact, miHoYo was expected to deliver a better game. The current version falls short of our expectations.

Alibaba has signed NBA star Tony Parker as an ambassador for Alibaba.com, its cross-border business-to-business retail platform, just days before the Paris Olympics, as the company tries to lure European customers and eyes further international expansion. 

Why it matters: The signing of Parker comes shortly after David Beckham became ambassador for AliExpress, and its connections with professional sports figures indicate Alibaba’s intention to expand its businesses to reach a larger user base.

Details: Alibaba.com, founded in 1999 as the Chinese tech giant’s first business, was designed to serve as a bridge between foreign wholesalers and Chinese manufacturers.

• Tony Parker made his entrepreneurial debut in 2019, after a legendary career marked by four NBA championships during his prime. Alibaba said Parker has a “powerful appeal” in the US and Europe.
• The NBA star’s advertisements for Alibaba can be found in Paris’ Charles de Gaulle airport and subway stations, and at well-known landmarks such as Avenue des Champs-Élysées.
• The ongoing UEFA Euro 2024 football competition has benefited Chinese merchants on Alibaba’s international-focused e-commerce platform AliExpress, according to the company. One AliExpress seller from Xiamen, surnamed Zhang, decided to increase their stock of soccer-related goods “soon after” Beckham was appointed as the platform’s global ambassador ahead of the tournament. Zhang has seen a tenfold increase in sales within one month, AliExpress said in a WeChat post.

Context: Global sports events are a significant traffic pool for Chinese brands looking to expand their business overseas, with prominent logos on the field and strong visitor flow rate as well as live viewer count making for fast results, as demonstrated by the spike in downloads of Temu after its Super Bowl debut in 2023.

Kuaishou, one of the main rivals to TikTok’s China sibling Douyin, showcased several fresh features for its text-to-video model Kling AI at the World Artificial Intelligence Conference (WAIC) in Shanghai last week, including the ability to generate videos up to 10 seconds. 

At WAIC, visitors queued to experience the Sora-like tool that is currently available by invitation only. Users sent simple prompts to generate videos, such as “a panda eating salmon” and “the Mona Lisa putting her glasses on with her hands”, with the resulting clips demonstrating Kling AI’s ability to render the inputs almost perfectly.

AI-generated videos have subsequently flooded the Chinese internet, with Kling AI being used to create clips featuring characters from historical films undertaking modern day tasks and spawning multiple memes.  

A video featuring Rong momo, a character from “My Fair Princess” who has become a well-known internet meme in China, feeding Princess Ziwei a chicken drumstick has gone viral on social platforms these days. The AI-generated video is based on the drama’s most famous scene in which Rong momo tortures Ziwei by repeatedly stabbing her with a needle.

Why it matters: Kuaishou will be hoping that its suite of self-developed large model series, including language model KwaiYii, image-focused Kolors, and video-centered Kling, will give it an edge as it continues to challenge to ByteDance’s Douyin and TikTok.

Details: More than 500,000 users have applied to help beta test Kling, senior vice president of Kuaishou Gai Kun revealed last weekend at a WAIC forum, with the number of videos generated reaching 7 million as of now. The Sora rival’s hype is such that English language posts teaching users outside of China how to apply for a Kling AI trial can be found on X, formerly known as Twitter.

• Kuaishou provided practical tips on the screen at the WAIC event, including advising users to use simple words and sentence structures and to avoid overly complex language. It also emphasized that its model is not sensitive to numbers, giving an example that if the prompt is “10 puppies on the beach,” the number might not be consistently maintained in its outputs.
• A member of staff from Kuaishou’s large language model team told TechNode that they were not at liberty to disclose the data used to train Kling AI, but indicated that it was open source.
• The TikTok rival meanwhile announced at WAIC that its Midjourney-like model Kolors would become open source, a move which Kuaishou said aims to contribute to a more prosperous ecosystem for the text-to-image generation community.
• Kuaishou’s investment in research and development has quadrupled over four years, with expenditure increasing from RMB 2.9 billion in 2019 to RMB 12.3 billion in 2023.

Context: Kuaishou, China’s second-largest short video company, launched its AI strategy in 2023, according to CEO Cheng Yixiao, who said that generative AI has a “very rich combination of business scenarios and huge value potential” for the content platform.

Editor’s note: ‘Landing AI’ is a series of special reports focusing on the field of Artificial Intelligence curated by TechNode. By investigating the development of AI landing in China and the behind-the-scenes stories of the industry, we’re going to dive deeper into everything that’s possible under the new wave of AI.

A former Tesla engineer, now head of autonomous driving at China’s Chery, on July 4 shared her outlook on Chinese automakers’ future capacity to scale autonomous driving technology, as Tesla leads the way with its mass data and sophisticated artificial intelligence models.

Domestic companies are roughly 1.5 to 2 years behind Tesla in developing “end-to-end neural network” technology for autonomous driving. The recent release of Tesla’s Full Self-Driving (FSD) software v12 marked “a great leap forward” in applicability and user experience (our translation) according to Gu Junli, chief executive of Chery-affiliated ZDrive.ai, and a former senior staff machine learning engineer at Tesla, speaking at this year’s World Artificial Intelligence Conference (WAIC) in Shanghai.

Gu said she expects Chinese players to partially replace modules of advanced driver assistance systems (ADAS) with data-driven, rather than rule-based, neural networks by 2025. This shift comes as car companies ramp up efforts to collect fresh, multiformat data to improve models with more computing power. However, there would not be a single large neural net, where the core capability of Tesla’s latest software is built, for production cars until 2026-2027 in China, Gu added. Tesla in April announced its FSD users had traveled a cumulative 1.2 billion miles.

Recent figures from the community-run FSD Community tracker show Tesla’s remarkable progress in refining its autonomous driving features. The latest FSD v12.3.6 version can drive 372 miles (599 kilometers) between critical disengagements, compared with just a few miles it reportedly achieved two years ago, according to crowdsourced data released by the website in May. Tesla chief executive Elon Musk later forecasted on X “a major improvement in MPI (miles per intervention)” with the release of the FSD v12.5 in late June.

“This means the system has met the requirements for most users on normal daily commutes,” said Gu.

Several Chinese early movers are working to achieve a partial end-to-end pipeline for enabling their advanced driving features, hoping to gradually transition to fully end-to-end algorithms. On July 5, Li Auto revealed details about what it called “China’s first single one model” behind its Navigation on ADAS (NOA) functions. The Chinese electric vehicle startup claimed this model would use raw sensor input to generate vehicle motion plans. However, unlike Tesla’s solution of “basically photons in and controls out,” as described by Musk, it still relies on pre-defined, explicitly coded rules to produce control actions as output.

Meanwhile, other peers, such as Xpeng Motors and Huawei, have been taking partial end-to-end approaches, using separate neural networks for multiple tasks such as perception, planning, and action, while many are still struggling to improve results. According to a recent survey compiled by China’s Gaogong Industry Institute, Chinese users typically take the controls at least 1-2 times per 100 kilometers (62 miles) as their cars’ ADAS functions do not react appropriately in urban scenarios. Tesla may find issues in localizing its ADAS software due to China’s complicated traffic conditions, said Xpeng’s head of autonomous driving, TechNode reported.

Gu mentioned Chery’s plan to launch the advanced city NOA function for some premium models in the first quarter of next year, while its single deep learning network could go live in 2026. The Chinese auto major, which sold nearly 1.9 million cars last year, plans to integrate Level 2 ADAS systems into as many as 500,000 new cars sold this year, including 150,000 units for overseas markets. Based in the eastern Chinese city of Wuhu, Chery had a relatively late start in autonomous driving, with ZDrive.ai being set up early last year.  

Despite Tesla’s leading position with its training wheels finally taken off, Gu envisioned that Chinese companies would contribute to a wider and more personalized adoption of self-driving technology worldwide. State-owned Chery in April reached a joint venture deal with Spain’s EV Motors to produce cars at a former Nissan plant in Barcelona later this year, Reuters reported. Meanwhile, customers from some overseas markets could access Xpeng’s XNGP ADAS capabilities as early as next year, president Brian Gu told investors during an earnings call in May.

READ MORE: Chinese companies take on Tesla’s Full Self-Driving with non-lidar approach, end-to-end AI

“Hello, I will arrange the bread and fruit separately.” Upon hearing the command from the host, the humanoid robot Qinglong extended its arms and gently picked up a piece of soft bread with its steel fingers, placing it down into the basket on the table. 

At the World Artificial Intelligence Conference (WAIC) 2024 in Shanghai, one of the most influential AI events within the global tech ecosystem, the National Local Joint Humanoid Robot Innovation Center on Thursday unveiled the open-source general-purpose humanoid robot Qinglong for the first time. The event marks the debut of China’s first full-sized general-purpose humanoid robot model, along with the release of its related open-source technologies.

Why it matters: The unveiling of Qinglong marks China’s entry into the advanced field of full-sized general-purpose humanoid robots. Its open-source initiative is intended to accelerate innovation, collaboration, and development within the global robotics and AI communities, potentially driving advancements in a range of industries.

Details: During the Summit on Humanoid Robots and Embodied Intelligence Development Forum at WAIC 2024, the National Local Joint Humanoid Robot Innovation Center demonstrated Qinglong’s operation and design concepts on site.

• Qinglong has been independently developed by Humanoid Robots (Shanghai) Limited, a new R&D institution established by leading industry enterprises with a registered capital of one billion RMB ($140 million). The company was designated as the National Local Joint Humanoid Robot Innovation Center by the Ministry of Industry and Information Technology of China in May 2024.
• Qinglong stands at 185cm tall and weighs 80kg, according to the company. It features a highly bionic torso and anthropomorphic motion control, supporting multi-modal mobility, perception, interaction, and manipulation. With 43 active degrees of freedom, Qinglong achieved a maximum joint peak torque of 400 N·m (Newton-meters) and 400 TOPs (Tera Operations Per Second) of computational power.
• The humanoid robot combines mobile lower limbs for agile walking with lightweight, high-precision upper limbs for operations, the on-site presentation stated. The company claimed that the model supports rapid walking, agile obstacle avoidance, stable incline and decline movement, and resistance to impact interference, making it an ideal platform for developing general artificial intelligence software and hardware.
• “In the Year of the Dragon this year, we named our humanoid robot Qinglong [meaning green dragon in Chinese] and initiated an open-source community for humanoid robotics,” said Jiang Lei, Chief Scientist of the National Local Joint Humanoid Robot Innovation Center. “Through open-sourcing, our goal is to introduce a new humanoid robot model annually, each named after one of the Chinese zodiac animals, to foster a humanoid robot innovation community unique to China,” he announced at the forum.
• Jiang also announced the launch of the OpenLoong open-source community website, developed by the Innovation Center. The website includes the release of the robot’s hardware structure and parameters, with the embodied intelligence software package set to be open-sourced soon.

Context: On the same day, Tesla debuted its second-generation humanoid robot Optimus at the Shanghai World Expo Exhibition Hall during WAIC 2024. According to Tesla booth staff, compared with the first generation, Optimus has improved its walking speed by 30% while maintaining upright posture. Its fingers have also evolved to perform delicate tasks such as gripping eggs and handling heavy objects.

• Tesla plans to start limited production of humanoid robots next year, with over 1,000 Optimus units expected to assist in production tasks at Tesla factories, according to CEO Elon Musk.

Chinese carmakers Geely, NIO, and Huawei-backed Aito on Monday reported record deliveries of electric vehicles for June as the country’s EV segment recovery gathers momentum. Meanwhile, Huawei and Li Auto are emerging as the leaders among the newer players, despite BYD and Tesla still enjoying a near-duopoly position in the world’s largest EV market.

Why it matters: The rally, which contrasts with overall flat sales in the market, comes amid a temporary cooling-off period for the industry-wide price war on electric autos in the country. It also reflects companies’ sprints to make deliveries by the end of the first half of 2024. A new wave of consolidation and some reshuffling is also speeding up within the sector, with fewer smaller players staying in the game and some legacy giants falling behind.

Details: Li Auto topped the ranking among young EV makers by delivering 47,774 cars to customers in June, up 36.4% from a month earlier, as sales of its most affordable extended-range hybrid crossover the L6 started to ramp up after its April launch. Chief executive Li Xiang also attributed the sales recovery to improved efficiency, as the company restructured its sales and delivery teams recently following a failed launch of its first all-electric model, the Mega, in March.

• Huawei continues to put pressure on Li Auto despite delivering 1,633 fewer vehicles than the Nasdaq-listed EV startup in June. The Chinese technology giant said its Harmony Intelligent Mobility Alliance (HIMA), which for now includes Aito and Luxeed brands only, delivered 194,207 vehicles from January to June, which is more than the 188,981 units posted by Li Auto. Huawei will launch a new premium brand called Stelato with partner BAIC next month after it began taking orders for the first model, the S9, on May 31.
• Among traditional competitors, Geely set a new record for EV sales of 65,959 units in June. In particular, deliveries of its mainstream luxury brand Zeekr surpassed the threshold of 20,000 units for the first time since its inception. Geely management on Tuesday announced it was raising this year’s sales goal by 5% to 2 million units, while Zeekr’s annual outlook of selling 230,000 units remains on track. Lynk & Co sold 24,439 cars last month, 62% of which were EVs, a record high percentage for the Geely-Volvo joint brand.
• Changan’s EV sales rose 61% year-on-year and 14.7% month-on-month last month to roughly ​​64,000 units, of which 16,659 were Deepal-branded EVs. The automaker said it received more than 15,000 refundable orders for its first off-road sports utility vehicle, the Deepal G318, priced from RMB 175,900 ($24,186), five days after it was launched on June 13. Chery’s EV sales surged 181.5% to 180,947 units during the first half of this year, thanks to strong overseas demand for its budget cars, such as the QQ Ice Cream and Little Ant.
• Both NIO and Leapmotor reached the 20,000-unit milestone in June. NIO has sustained the growth momentum that it’s seen since April and is demonstrating the potential to deliver 30,000 cars a month once its first mainstream car goes on sale in September. Leapmotor reached the milestone for the first time last month, as the Hong Kong-listed firm now positions itself as a cheaper alternative to Li Auto. Smartphone giant Xiaomi handed over more than 10,000 SU7 sedans to customers in its third delivery month.
• Meanwhile, Tesla is feeling the heat. Sales of its China-made vehicles declined 10.5% year-on-year to 426,623 units during the first half of this year, including exports, according to figures released by the China Passenger Car Association (CPCA). The US automaker said on Tuesday it delivered 443,956 vehicles in the three months to June 30, a smaller-than-expected 5% drop from a year earlier and up 14.8% from the previous quarter, sending shares up more than 10%, Reuters reported.

Context: China’s retail passenger EV sales volume is expected to reach 864,000 units in June, representing a 30% growth from the same month last year and a 6% rise from May, while overall car sales declined 8% year-on-year, the CPCA estimated on Wednesday.

READ MORE: China’s EV sales recovery picks up pace in May, helped by promotions

US-based private equity investment firm Matrix Partners has rebranded its China arm as MPC in English, the initials of Matrix Partners China, keeping the Chinese name unchanged starting from July 1. Matrix Partners is the latest dollar fund to make its China operations independent amid geopolitical concerns, following Sequoia, BlueRun, and GGV Ventures.

At the same time, the firm said it would also rebrand its Indian business to DZ47.

Why it matters: Matrix Partners’ renaming reflects greater independence for its China operations, according to the company, but stops short of a complete split from its international operations, the path that many of its US counterparts have opted for.

Details: “Each team’s leadership has operated with separate decision-making and separate back offices from inception,” the US-headquartered venture firm said in a notice, emphasizing that the renaming is driven by a desire to clarify “regional market dynamics” and a continued focus on “competing locally.” 

• In China, Matrix Partners’ investment reach includes companies in the Internet industry, healthcare, and retail fields, with Xpeng, Li Auto, and Ele.me being its best-known assets.
• The firm set up its China unit in 2008, managed by partners Zhang Ying, Xu Chuansheng, and Shao Yibo, 30 years after it was founded in Boston. MPC currently manages more than RMB 70 billion ($9.6 billion) worth of assets, its official website shows.
• The 16-year history of the early-stage-focused VC company in China has run alongside booming growth in the country’s Internet service industry. In an interview with local media outlet ChinaVenture, Zhang Ying said China’s faster economy and technological growth provided him with a “perfect starting point” for in-depth investment activities.
• Zhang added that he believes there will be a prolonged period ahead where investing in entrepreneurship will become “increasingly difficult,” due to the continued changes in the international landscape.

Context: In the past year, several US venture capital firms have split off their China arms as independent operations have felt increasingly like a better choice due to heightened geopolitical tensions and the increased likelihood of US-China technological decoupling.

As Tesla’s most advanced driver assistance software (ADAS) is becoming an immediate threat due to its impending arrival in China, major Chinese electric vehicle makers and auto tech companies are hurrying to pivot their strategies towards a more pragmatic yet challenging approach to developing similar offerings. Although Tesla’s rivals have for years been looking to cut out expensive components and master the newest artificial intelligence models, the game seems to be different this time.

Both NIO and Xpeng Motors are now embracing the so-called computer vision approach, championed by Tesla, hoping their upcoming models will achieve human-like downtown driving in cities via the use of fitted cameras and radar, rather than more expensive laser sensor units. Sinpro.ai, a supplier to NIO of ultra-high-resolution four-dimensional (4D) imaging radar, said it is prepared for delivery later this year with an annual capacity of 800,000 units. Tesla has reportedly replaced radar sensors on some models after years of attempting to remove them.

“It will be a difficult task for Tesla’s Full Self-Driving (FSD) software to deal with scenarios in China where it is common that a large number of electric scooters are usually ahead in the same lane with motor vehicles,” Li Liyun, vice president of autonomous driving at Xpeng, wrote on June 27 on Chinese Twitter-like microblogging platform Weibo. Xpeng is planning to remove lidar from its upcoming sedan, scheduled for launch later this year, local media has reported.

Xpeng and NIO are also following Tesla’s suit by transitioning to an “end-to-end” autonomous driving method after using modular-based neural networks that are heavily reliant on explicit coding. Meanwhile, more traditional automakers are turning to domestic tech companies for help, such as Huawei and DJI, to catch up with the latest AI trend. Despite big challenges pressuring the industry, some early movers have the potential to compete with the US pioneer, Liu Guanghao, partner at Shanghai-based venture capital firm Befor Capital, told TechNode.

READ MORE: China opens door wider to Tesla as local giants disrupt the EV sector with AI-defined vehicles

Vision-based approach

A break from previous strategies of using expensive chips and sensors to enable ADAS capabilities, the latest approach centers on reducing the cost of components in hopes of making more room for further price cuts. Many now have their eyes on the use of radar, ditched by Tesla in 2021 due to limitations in identifying stationary objects with low image resolution, as some parts makers now said it is coming close to lidar in terms of performance – but at a lower price tag.

“There is more overlap between lidar and our sixth-generation radar systems as we significantly improve the resolution,” Juergen Brandl, Head of Market China, Business Area Autonomous Mobility at Continental Group, told TechNode. “Radar could soon see through [objects] but lidar has some problems with the distance especially in difficult situations like fog and rain.” The German firm’s newest front-facing radar boasts a detection distance of 280 and 140 meters (174 and 87 miles) for vehicles and slow-walking pedestrians, respectively.

Advanced radar solutions like this also create three-dimensional point cloud datasets like lidars, helping automakers and developers move towards fully end-to-end models with raw data collection from multiple sensors to train their self-driving systems. “We can play a big role in the development of Level 2 plus ADAS systems in China,” Brandl said, adding that the company’s product is below the price of a lidar unit with “very good“ output in terms of point cloud data.

Some disagree however, saying the technology is still at an early stage. Production of Continental’s latest-gen radar started early this year and the company began delivering the world’s first 4D radar in 2021, which detects an object’s vertical information in addition to distance, direction, and relative velocity, generating more dense point clouds than a contentional radar. Meanwhile, major Chinese lidar makers have consistently enhanced the performance of their products and lowered the prices to just over RMB 1,000 ($137.6) per unit in recent years.

The key is whether 3D/4D radar could prove to be a more “cost competitive” option compared with lidar, said Liu. “I believe both [radar and lidar] have their special advantages and disadvantages,” Brandl said. ”I think time or the market will tell whether we need both of them or one solution only.”

Either way, prospects for early players are bright. Momenta, a self-driving car company backed by General Motors and Toyota, expects the bill of materials, or total cost of components, for the City NOA (Navigation on ADAS) function to be slashed to RMB 4,000-5,000 from the current RMB 7,000-10,000 in the next two years. The intent is to survive an unprecedented price war in China that has been ongoing for more than a year.

End-to-end AI

Chinese carmakers used to brag about their coverage of cities where their assisted driving software is said to enable cars to handle on-ramp to off-ramp driving, automatic highway lane changing, and congested streets. However, many are now pivoting their focus to provide a more human-like driving experience and a full end-to-end AI model is now seen as key to winning the battle.

Described by Tesla chief executive Elon Musk as “basically photons in and controls out,” such end-to-end neural networks play an integral role in a vehicle’s decision-making process, taking raw sensor data as input and producing control actions as output. This contrasts with the conventional approaches that see each functionality, from perception to planning and action, developed individually using rule-based designs, which are often inadequate  in addressing the vast number of scenarios that occur on the road, a team of researchers said in a recent report.

The result is that people still feel their cars pilot themselves inhumanly even when kitted out with some of the most cutting-edge ADAS on the market, partly because human driving behavior tends to be consistent rather than discrete. It is very difficult for the current AV (autonomous vehicle) stack to make coherent, long-term decisions, said Wu Xinzhou, Nvidia’s vice president of automotive at its annual developer conference GTC in March.

Recent surveys have shown automakers that customers are generally dissatisfied with existing ADAS functions. Nearly half of respondents take the controls 1-2 times per 100 kilometers (62 miles) as the city NOA functions do not react appropriately, while others make more frequent interventions, according to a recent survey compiled by China’s Gaogong Industry Institute. “When the driver has to interfere pretty often, then you cannot say this is autonomous driving,” said Brandl.

Xpeng is aiming for less than one intervention per 1,000 kilometers in major traffic areas in China, CEO He Xiaopeng announced early this year, without giving a timeframe. This was followed by a new software update for its XNGP ADAS in May enhanced by the first end-to-end AI model for production vehicles in China, according to the EV maker. NIO reshuffled its autonomous driving department recently, rolling up its perception as well as planning and control teams into a single group with a focus on new AI models, Chinese media outlet LatePost reported on June 19.

It requires huge amounts of data, for example, millions of video clips, to train AI systems, as well as deep pockets and access to AI chips. Musk told investors in April that his company will increase the number of Nvidia’s flagship AI processors it uses from 35,000 to 85,000 by the end of this year. He wrote in a post on X earlier that month that the investment in training computers, gigantic data pipelines, and video storage will be well over $10 billion cumulatively this year.

Such major investment and effort is not something all companies can handle however. “It would be so hard for most traditional automakers to do this by themselves. The best way is to pick a supplier,” Liu said.

The entry of Tesla’s FSD into China may feel like a new challenge therefore, but it may also coincide with a new era of partnerships around self-driving technologies.

Chinese artificial intelligence firm iFlytek on Thursday unveiled the latest version of its AI model, Spark 4.0, which the company benchmarked against OpenAI’s GPT-4 Turbo, saying it shows better performance than the US company’s most-advanced model in five aspects, despite lagging in terms of coding and multimodal abilities.

Why it matters: Trained exclusively on a home-grown computing platform that is co-built with telecom giant Huawei, Spark 4.0 can be seen as sending a signal that China’s AI industry has entered a new phase of self-sufficiency despite the US’s restrictions on the country’s access to the most advanced chips, according to iFlytek.

Details: The Hefei-based company finally fulfilled its commitment to upgrade its Spark model to the level of GPT-4 in the first half of 2024, eight months after the promise was made. At Thursday’s event, however, Chairman Liu Qingfeng acknowledged that the gap would “widen again”, possibly to more than a year, once GPT-5 is released, because of its larger parameter size, longer training time, and the increase in the amount of data used.

• “It is necessary to recognize the comprehensive gap between China and the US in the LLM in a scientific and rational way,” said Liu, “but also to have the confidence to catch up quickly to ensure there is no generation gap.”
• The company has seen over 400,000 overseas developers build products based on the Spark V3.5 model that was introduced in January, with 7.02 million developers having used it in total.
• In a key upgrade, the Spark app and its desktop version, both of which are by iFlytek’s model series, added a feature called “personal space” where foundation models are dedicated to generating individualized content that matches one’s personality. The mechanism operates on the premise that users can input their information on work, study, and life, or accumulate sufficient dialog records with AI bots for enhanced learning.

Context: While iFlytek said its Spark 4.0 model ranked number one in eight international mainstream test sets, rival Alibaba on the same day was also certified by the world-renowned open-source platform Hugging Face as topping the world’s open-source big model list for its Qwen-2, with Meta’s AI model ranked behind it in second.

Plants vs. Zombies Hybrid Edition, a remastered version of the classic tower defense video game published by the American company PopCap Games, went viral in China in June, 15 years after its first release. 

The creator of the Hybrid Edition is blogger Submarine Weiweimi (our translation of 潜艇伟伟迷 in Chinese) who posts on Chinese video platform Bilibili. Chinese netizens nicknamed him Cyber Mendel (father of modern genetics) because of the unique appearances and intriguing abilities he has given the plants and zombies in the new version.

Why it matters: The Hybrid Edition entices users with nostalgia and innovative gameplay, blending classic elements with new twists. In June, China’s live-stream gaming channels were flooded with images of vibrant landscapes and intense plant-based explosives.

Details: Submarine Weiweimi chose not to market this Hybrid Edition as a commercial product but aimed to provide a free gaming experience for players in China. The free strategy brought more players to the game, increasing its influence and popularity in China.

• The Hybrid Edition combines different creatures from the game Plants vs. Zombies, creating new species with dual-layered abilities. For instance, in the original game, Peashooter attacks zombies, and Sunflower produces the sunlight needed to make more plants. In the Hybrid Edition, these two are combined as Peashooter-Sunflower, which can produce sunlight and shoot pea bombs at the same time.
• Players can easily grasp the game with minimal effort to enjoy the thrill of gameplay, as both plants and zombies have multiplied their attack power several times through hybridization, compared to the original version.
• In the past month, Submarine Weiweimi’s Douyin (Chinese Edition of TikTok) account gained 1.47 million followers, while its Bilibili account attracted over 2.45 million followers, making it one of the fastest-growing and most popular KOLs (key opinion leaders) in China, according to market intelligence platform NewRank.
• As of writing, Submarine Weiweimi’s Bilibili account has 3.97 million followers, 18.69 million likes, and 4.3 billion views. On Bilibili, the influencer released a video responding to the popularity of the Hybrid Edition, stating that he had no grand ambitions but is simply trying to make up for the regrets of his childhood. As a member of the post-2000 generation, he has been deeply attached to the game Plants vs. Zombies since childhood, he said. He created the Hybrid Edition to improve on the original game’s components, he added.
• The official Bilibili account for Plants vs. Zombies announced last week that the third-party modified work Plants vs. Zombies Hybrid Edition has been integrated into its mini-program, allowing players to experience it in the game’s creative mode, according to local media outlet IThome.

Context: On November 20, 2023, Submarine Weiweimi released the first video of the Plants vs. Zombies Hybrid Edition series titled Hybrid Plants on Bilibili. Subsequent videos in the Hybrid Plants series have continued to gain video views, with enthusiastic fans actively engaging in the comments section, sharing creative ideas and suggestions to support the game.

• On March 27, the blogger released the downloadable files for the self-developed game Hybrid Edition 1.0 for free. On June 13, the Hybrid Edition version 2.1 was launched.

China’s AI companies are rushing to win over OpenAI users in the country as the ChatGPT creator takes measures to block API traffic from countries and regions that it does not officially support. Affected regions include mainland China, Hong Kong, Russia, and Iran.

Why it matters: OpenAI’s latest announcement on API restrictions has been widely interpreted as targeting China, where  local enterprises and developers have been using OpenAI’s API to build products or services. On the other hand, the move is being regarded as an excellent opportunity for Chinese AI companies to woo these users.

Details: Developers in China have posted screenshots of a notice from OpenAI to various online communities that states, “Our data shows that your organization has API traffic from a region that OpenAI does not currently support.” The notice adds that OpenAI will block such access starting on July 9.

• API is an abbreviation for Application Programming Interface. Although Chinese IP addresses are not allowed to use OpenAI’s artificial intelligence software directly, local developers and companies have been able to create applications through OpenAI’s API platform, while individuals can change their IP address in order to get ChatGPT services. 
• Search giant Baidu, one of China’s leading AI companies, on Tuesday launched a program called Cloud in Hometown that grants additional tokens that equal the scale of their OpenAI usage to users who migrate from OpenAI to the company’s own ERNIE series model. 
• Baidu is also touting a zero-cost solution for developers to migrate from OpenAI, although it does charge a fee for further training, fine-tuning of prompts, and custom development services.
• Alibaba Cloud has also joined the fray with an alternative solution that it claims is “the most cost-effective” with 22 million free tokens for Chinese developers.
• Local AI startups, Zhipu AI, 01.AI, and Baichuan, have also launched exclusive offers for OpenAI users, with Tsinghua University-backed Zhipu being the most generous at time of writing with an offer of 150 million tokens for free.

Context: China has over one hundred AI models with parameters beyond 1 billion, according to data disclosed by the National Bureau of Statistics in March. Commercialization has become a key priority for the companies behind these models in recent months with a price war over tokens breaking out as the firms vie for potential clients.

China’s Great Wall Motor is poised for its big entry into Southeast Asia, as the automaker said on Monday it would begin manufacturing its cars in Malaysia and Indonesia as early as July, in addition to its planned entry into Vietnam, local media reported.

Why it matters: The news comes as Malaysia surpassed Thailand to become the second biggest car market in the region after Indonesia in the first three months of this year, according to sales figures released by industry groups and compiled by Nikkei. This makes it another attractive market for Chinese car manufacturers given its growing economy and large population.

• Total vehicle sales increased 5% year-on-year to 202,245 units in Malaysia from January to March, in part driven by the government’s economic stimulus package, figures from the Malaysian Automotive Association show. Meanwhile, Thailand’s car sales, including internal combustion engine cars and EVs, fell 24.6% to 163,756 units from a year earlier, partly because of tightening rules around car loans, said the Federation of Thai Industries.

Details: Great Wall Motor will start operating a pure assembly plant with Malaysia’s EP Manufacturing in Malacca in July at the earliest, Cheng Jinkui, president of the company’s ASEAN operations, told the Business Times.

• The two companies said in January they would commence assembly of two of Great Wall Motor’s popular Haval models – the Haval H6, a five-seater sports utility vehicle, and the Haval Jolion, a compact crossover. The cars will be made from “completely-knocked-down (CKD)” kits comprising major parts with the goal of producing 20,000 units a year by 2028.
• Another CKD facility in Indonesia is also set to come into production in July or August, while the Chinese automaker is aiming for local assembly in Vietnam in 2025, according to Cheng. Great Wall Motor said last June that it was exporting the Haval H6 hybrid EVs to Vietnam from Thailand, where it operates a car plant it acquired from General Motors in September 2020.

Context: Chinese automakers are ramping up their investments in emerging EV markets overseas, especially in regions such as Southeast Asia, the Middle East, and Latin America, at a time when competition remains intense at home and the US and Europe are imposing punitive tariffs on China-made EV imports.

• Geely and Malaysian automaker DRB Hicom last year reached a $10 billion deal that will transform the country’s Tanjung Malim area into an “automotive high-tech valley” with an annual production capacity of 500,000 vehicles by 2035, China Daily reported. Sales of Geely-backed local automaker Proton more than doubled to roughly 154,000 units last year, while Smart, a brand co-owned by Geely and Mercedes Benz, began exporting cars to Malaysia last year.
• Indonesia said four Chinese automakers, namely Chery, Neta, General Motors’ China joint venture Wuling, and Dongfeng’s Sokon, have agreed to expand their global manufacturing footprints to the country. The deals were announced when Indonesian Industry Minister Agus Gumiwang Kartasasmita visited Beijing earlier this month, Caixin Global reported. Neta, also known as Hozon Auto, shipped 16,458 EVs overseas from January to May, more than a third of its total deliveries.
• China recorded exports of roughly 519,000 new energy vehicles, mainly all-electrics and plug-in hybrids, for the first five months of this year, representing a 13.7% growth from last year, according to figures from the China Association of Automobile Manufacturers (CAAM). BYD and Tesla were the largest exporters, with shipments of more than 130,000 units. Great Wall Motor exported 9,646 units but said last month it would shut down its European headquarters in Munich, Germany.

Chinese tech giant Huawei opened the Huawei Developer Conference (HDC) 2024 in the city of Dongguan in southern China on June 21, by launching the new Beta version HarmonyOS NEXT, an all-scenario operating system for developers. The HarmonyOS ecosystem covers a diverse range of products including smartphones, smart wearables, tablets, headphones, smart driving vehicles, and smart home solutions.

“HarmonyOS NEXT is a fully self-developed, independently controllable operating system originating from China,” said Yu Chengdong, Huawei’s Consumer business group chair, at the event.

Why it matters: HarmonyOS NEXT is entirely independent of Google’s Android system. The kernel of HarmonyOS NEXT, the most critical part of the operating system, has cut its ties with  the Linux system altogether, the company professed.

Details: HarmonyOS NEXT Beta version has been promoted to developers since June 21 and will be released to consumers in August, according to Huawei. 

• Yu announced that the upcoming flagship smartphone Huawei Mate70 series will be the first device to come with HarmonyOS NEXT pre-installed in the third quarter, while the firm’s other smart devices are expected to come loaded with HarmonyOS NEXT version in the fourth quarter.
• HarmonyOS, released in August 2019, has undergone four generations of development. Currently, the Harmony ecosystem includes over 900 million devices, with 2.54 million developers actively contributing to its development, Huawei claimed. Additionally, the monthly volume of API (Application Programming Interface) calls for application development has reached 82.7 billion, the company said.
• HarmonyOS NEXT needs to strengthen its native app ecosystem due to the discontinuation of support for Android applications. HarmonyOS native applications have entered a full-scale sprint phase, with over 1,500 apps launched and 5,000 apps under development. 

Context: Huawei developed its own operating system, HarmonyOS, due to US sanctions restricting its access to Google’s Android that took hold in 2019. This move aimed to ensure independence and provide a viable alternative for its global smartphone market.

• In the first quarter of 2024, Huawei’s HarmonyOS surpassed Apple’s iOS, becoming the second largest operating system in the Chinese market after the Android system, according to market research firm Counterpoint Research. HarmonyOS’s market share in China has risen from 8% in the first quarter of 2023 to 17% in the same period of 2024, while iOS’s share decreased from 20% to 16%, the report said.

Level Infinite, the overseas gaming distribution arm of Tencent Games, announced on Thursday that it has launched a global version of its hit mobile game Honor of Kings in a swathe of new international markets including Japan, South Korea, North America, and Europe.

Level Infinite stated that Honor of Kings has now established a global service network and supports 14 languages to enhance the gaming experience for players around the world.

Why it matters: The most profitable title from Tencent Games, Honor of Kings is already the world’s biggest multiplayer online battle arena (MOBA) game according to the company, with a global launch somewhat overdue. Honor of Kings maintains a daily active user base of 100 million, the company said.

Details: TiMi Studio, a subsidiary of Tencent Games, originally released Honor of Kings in China in 2015. The latest development means it is now available globally in more than 160 countries. 

• Honor of Kings is a competitive MOBA title where players choose from a diverse line of heroes, each with unique skills, to engage in strategic team battles. To celebrate the global release, the game introduced Lu Yana, a new hero exclusive to the global edition. Currently, a total of 85 characters, of which 28 are free to use, are available to global players.
• The design inspiration for Lu Yana comes from the mysterious Latin American legend of Boitata, according to the game team. The first region-themed exclusive hero was born after in-depth discussions with local gaming experts, they added. Boitata is a mythical creature from Brazilian folklore, often depicted as a giant serpent or dragon that emerges from bonfires and protects the forests.
• At time of writing, Honor of Kings topped the free-download game chart in 10 countries or regions, securing a spot in the top 10 of 25 countries’ free-download gaming charts, local gaming media outlet GameLook reported today. The ten countries or regions where it tops the charts are Canada, the Philippines, Brunei, Myanmar, Singapore, Cambodia, Malaysia, Indonesia, Bolivia, and Bermuda. Additionally, in terms of free-download mobile games, the game ranked second in the US, fourth in Japan, and eleventh in South Korea.
• Tencent Games has deployed dedicated servers in every country or region to ensure low latency and optimal game performance, the same GameLook report revealed. Due to regulatory constraints, Honor of Kings cannot achieve global cross-server play between Chinese and global versions. However, Chinese players can authorize migration of their data when logging into the global version.

Context: In the first quarter, Tencent’s revenue from the overseas gaming market increased by 3% year-on-year to RMB 13.6 billion ($1.88 billion), while revenue from the domestic gaming market decreased by 2% year-on-year to RMB 34.5 billion ($4.77 billion). 

• In 2023, Honor of Kings reached nearly $1.48 billion in in-game revenue, making it the highest-grossing mobile game of the year for Tencent Games, according to market intelligence firm AppMagic.

Chinese automaker Dongfeng Motor will introduce the first global model from its premium electric vehicle brand Voyah as early as the third quarter of this year, in what will be a direct challenge to Tesla’s best-selling crossover the Model Y, local media has reported.

The 100% electric compact sports utility vehicle (SUV) will feature Huawei’s vision-based approach to automated driving functions on urban streets. It will also be produced in a joint plant set up with Nissan, as fierce competition has put downward pressure on the Japanese firm, a regulatory filing has shown.

Why it matters: Stellantis and Nissan’s Chinese manufacturing partner expects the model to appeal to young families and drive sales in the country’s already crowded mainstream luxury EV segment, company sources told National Business Daily (in Chinese) on Tuesday.

Details: Sources added only full-electric variants will be on offer for the Zhiyin (知音), which loosely translates as “bosom buddies” in Chinese. This is in line with a filing that was published last month by China’s top industry regulator, which shows the car has six variants with battery options using two types of cathodes – more energy-dense nickel cobalt manganese (NCM) and cheaper lithium iron phosphate (LFP).

• The five-seater SUV measures 4.7 meters in length and 1.6 meters in height with a wheelbase of 2.9 meters, according to the registration filings released by China’s Ministry of Industry and Information Technology (MIIT). This is roughly the same size as the Tesla Model Y and smaller than the first model under the Voyah brand, the Free SUV.
• The all-wheel drive version will have a dual electric motor setup with both motors providing a power output of 160 kW, while other variants will be offered with either a 215 kW or 230 kW electric motor. All the variants have no lidar components, which are normally packaged on the car roof or near the bumpers to help the vehicle sense and interpret its surroundings.
• This means the new car will utilize the so-called “pure vision” approach, a strategy championed by Tesla, relying on cameras and artificial intelligence, rather than the more visible but more expensive laser sensor units, to achieve automated driving. Voyah announced in April at this year’s Beijing Auto Show its first global model would feature Huawei’s intelligent driving software and operating system HarmonyOS.
• Dongfeng will manufacture the car at its latest joint plant with Nissan, which opened last year in the central Chinese city of Wuhan with an annual capacity of 300,000 units. Nissan has been making several electric models including the Ariya with Dongfeng at this plant to date, although it sold less than 2,000 units of its second EV-only model in the country over the past six months, figures compiled by auto service platform Dongchedi showed.

Context: Nissan’s China joint venture with state-owned Dongfeng reported sales of 723,139 cars in the country last year, representing a 21.5% plunge from a year ago. The companies last November announced plans to export vehicles from China in 2025. The Japanese carmaker was also reportedly considering a 30% cut of its annual car output in China, along with peer Honda.

• Dongfeng’s Voyah in January announced a collaboration with Huawei to develop smart EVs. The brand has three models on sale and delivered 24,869 EVs, including all-electrics and plug-in hybrids, from January to May. The automaker’s off-road vehicle lineup Mengshi also works with Huawei.

Chinese developer Game Science last week invited a group of domestic gaming media outlets and veteran gamers to attend an offline demo event of its upcoming game Black Myth: Wukong, a highly-anticipated self-developed AAA game which has captured widespread attention in China this summer – even before it’s launched.

On Monday, local media released their evaluations of the new title, which is loosely based on the Monkey King character from Journey to the West, and gave their assessments of the game’s visual quality, artistic details, and playability.

Why it matters: As China’s first AAA title in recent years, Black Myth: Wukong is eagerly anticipated among Chinese gamers, with the hype continuing to build toward the game’s global launch on August 20. Major Chinese game companies such as Tencent and NetEase rarely develop single-player PC games due to high development costs and risks associated with return on investment, giving this title extra importance.

Details: The demo of Black Myth: Wukong lasted for two and a half hours. Several domestic gaming media outlets and players shared their impressions of the demo on various social media platforms in the aftermath.

• An action-adventure game based on the classic Chinese literary work Journey to the West, Black Myth: Wukong showcases a rich mythological aesthetic through its art, according to most media feedback. “It’s stunningly gorgeous, the animations are incredibly fluid, it’s steeped in rich Chinese culture, and there’s just something immensely satisfying about playing as a Monkey King and beating up all sorts of mythical creatures with a giant extendable staff,” wrote Mitchell Saltzman, editor of American video game media outlet IGN.
• Each battle is unique throughout the two and a half hours of gameplay, according to local gaming media outlet Youxi Putao. Each boss exhibits distinctive combat styles and tactics, including the Sword Wolf Leader, Spirit Master, and Black Bear Spirit. “Some bosses wield their skills with flair, showing off their prowess with full force. Others may seem simple-minded but excel in using underhanded tactics. Coupled with well-tuned game mechanics that vary spells and abilities, players can enjoy a diverse experience in boss battles,” said the editor from Youxi Putao (our translation).
• However, the game’s main thrill lies in its intense, high-quality boss battles, overshadowing the relatively mundane and unexciting content found between them within a short two-hour gameplay trial, the same Youxi Putao report claimed. 
• “While there are side paths, they frequently lead to dead ends or loop back to the main route. These paths include mobs, item materials, and elite monsters, but the combat lacks diversity and challenge. The absence of unique terrains, traps, or mechanics contributes to a bored monster-clearing experience. Additionally, the rewards are generally underwhelming, making it less appealing to engage with these mobs later on,” the editor from Youxi Putao wrote.
• On Bilibili – a popular Chinese video sharing platform themed around anime, manga, and gaming culture – on Monday, veteran gamers posted trial play videos and commentaries that quickly earned hundreds of thousands of views. The videos show that the combat system of Black Myth: Wukong emphasizes fast-paced and agile battles, particularly highlighting evasion and jumping. 

Context: An AAA game is a high-budget video game developed by major studios, known for advanced graphics, complex gameplay, and extensive marketing. These games involve large teams, long development cycles, and aim to deliver great gaming experiences with broad industry impact and high sales expectations.

• The physical deluxe and collector’s editions of Black Myth: Wukong for PC are priced at RMB 820 ($113) and RMB 1,998 ($276) respectively. In China, the deluxe edition was limited to 20,000 sets at the first round of pre-sales, while the collector’s edition was limited to 10,000 sets. Pre-sales for these editions began on June 10 and June 17, with both selling out in less than a minute. Reservations on the e-commerce platform JD exceeded one million for both rounds of pre-sales. Currently, it is unknown whether Game Science will start a third round of pre-sales for the game.

Major Chinese online retailers including Taobao and JD and emerging platforms like Xiaohongshu have said they saw positive metrics during China’s month-long 618 shopping festival, where low prices have taken center stage as merchants navigate the challenge of reduced consumer spending.

In an email, Alibaba sent to TechNode, the Taobao owner said it has seen “encouraging user engagement and growth” from merchants of all sizes.

Why it matters: The 618 shopping festival is the second largest online shopping event in China, with consumption levels during the event seen as a barometer of the country’s overall spending trends.

Details: Pinduoduo’s standout performance has turned it into a model for competitors, although the discount shopping app has become more aggressive recently as it looks to maintain its appeal. Before its main promotions began in late May, Pinduoduo quietly launched a system designed to automatically adjust prices within the range set by merchants, so that a product’s price drops if a competitor platform offers a lower price.

• At the same time, Taobao revamped its homepage to closely resemble that of Pinduoduo, its biggest rival. Changes include reducing the number of fixed channels, and highlighting algorithmically recommended items that it thinks users are likely to buy.
• In another key figure revealed by Alibaba, newly-added members of 88VIP, Taobao’s loyalty membership package, more than doubled in May compared to the previous month. The growth was fueled by additional value-added services such as access to unlimited free parcel returns. Taobao said more than 35 million users were recorded as part of the program in the first three months of 2024.
• JD, the platform that began the 618 shopping festival in celebration of its founding, this year partnered with Hunan TV for its evening gala three years after such last event was held. As part of the project, JD said it would hand out “heavyweight prizes” including resort stays and sports tickets to users who shopped on the app during the gala, which started at 8 p.m. on Monday. 
• Elsewhere, content-sharing platform Xiaohongshu reported triple orders on purchases made via its site compared with the same period last year.

Context: The main e-commerce players kicked off their 618 promotions in mid-May, but none have posted overall sales totals for the period.

The European Union announced on Wednesday it has taken a case-by-case approach to deciding how much tariffs could increase on Chinese electric vehicles. In a move that surprised many industry professionals, the preliminary duties set to hit Chinese EV imports will rise from the general 10% basis on all of them to between 27% and 48%, with SAIC and those deemed incompliant with EU standards facing the hardest hit. The tariff hikes are relatively moderate for the likes of BYD and Geely, which have either committed to growing deep roots within the EU or have already done so in the past.

Broadly speaking, the additional duties are still in line with what many analysts had expected, despite the possibility of a massive but temporary plunge in China’s EV exports to Europe. Chinese battery EVs are priced in general around 80-100% higher in Europe than in their domestic market, creating room for price adjustments, said Jefferies analysts led by Johnson Wan. There could be very limited benefit for major European players, as the high-volume EV segment would remain intensely competitive with subdued margins, said Patrick Hummel, Head of European Autos Research at UBS.

Although Bernstein analysts expect the provisional tariffs to be a serious turn-off to smaller Chinese brands, prompting them to focus on other export markets, bigger Chinese players are likely to step up their localization efforts. Paul Gong, UBS’s head of China Autos Research, also wrote in a note to clients, “Localization of production may become an increasingly appealing option over longer run compared to direct shipping from China for exporters to take shelter from trade conflicts and geopolitical tensions.”

Below, we take a look at what the key Chinese players have been doing in Europe and their respective prospects in a continent home to some of the world’s most important automakers.

BYD

China’s top EV maker is widely considered the least affected by the newly announced tariffs, with the strength to still break even on an import model thanks to its significant cost advantage versus peers. BYD’s EVs would still be priced lower than the similar models launched by European rivals, even if the company raises prices by 17.4% to fully pass on the additional tariff to customers, although the measure could effectively prevent its dominance in destination markets.

The leading Chinese player would also have a 25% cost advantage over European counterparts even after localizing the production of its popular sedan in the region, according to UBS’s previous findings. Set to be the first major Chinese automaker with a production base in Europe, BYD expects its Hungary plant to begin operation before 2026, with an annual capacity of 150,000 units. Although exports to Europe only account for a single digit percentage of its total sales, it aims to “be in a leading position” in the regional market by 2030.

SAIC

China’s biggest car manufacturer got relatively unfavorable treatment, and analysts expect the measures will significantly curb its competitiveness in Europe. The European Commission will impose tariffs of nearly 50% on EVs from the Chinese state-owned automaker, along with those deemed to be the least compliant with the nine-month anti-subsidy investigation announced last September. The company, which owns the iconic MG brand of British origin, said earlier it had “fully cooperated” with the investigation and hinted that the EU regulators misused their investigative powers in order to view sensitive business information related to its supply chain.

SAIC responded on Thursday by saying, “As SAIC MG’s sales in Europe continue to grow, we are planning to introduce China’s new energy vehicle (NEV) technologies and green factories to the continent” (our translation). The firm also called for more cooperation between China and the EU. China’s top car exporter to Europe, with shipments of nearly 243,000 units to the region last year, revealed plans last July to build a manufacturing facility plant on the continent.

Geely, Chery, and Dongfeng

Volvo parent Geely was among the three Chinese companies selected for further scrutiny and saw a relatively moderate tariff increase of 20%, another individually calculated duty rate. The impact is likely to be very marginal to China’s third biggest car exporter, thanks to its ownership of Volvo and the currently limited scale of its own brands in the region. Geely’s EV brand Zeekr said on Tuesday it is looking to establish a presence in six to eight European countries by year-end.

Chery, as well as its state-controlled peers such as Dongfeng and Chang’an, faces an extra 21% charge in a category for those cooperating with the probe but not sampled. Jaguar Land Rover’s Chinese manufacturing partner in April reached a joint venture deal with Spain’s EV Motors to produce cars at a former Nissan plant in Barcelona later this year, Reuters reported previously. Meanwhile, Dongfeng’s Voyah brand, previously planning to enter Germany, France, and Italy, has for now been selling EVs mainly in Nordic countries.

NIO, Xpeng Motors, and Leapmotor

Like their bigger peers, Chinese EV makers NIO, Xpeng Motors, and Leapmotor are also set for extra charges of 21%. NIO, which currently sells four models from more than €60,000 ($64,361) in Europe, higher than most domestic competitors, said on Wednesday its commitment to the regional market remains unwavering and it will continue to explore new opportunities within the EU despite protectionism.

The company is still looking to introduce its lower-priced vehicles, including an upcoming third brand codenamed Firefly, in Europe, but the plan is now being adjusted based on the current situation. Delivery of the first model, a well-designed boutique car, will begin in the first half of 2025 in China at a price cheaper than the BMW Mini, CEO William Li recently told investors during an earnings call.

Zhejiang-based Leapmotor, which has Stellantis as its largest shareholder, is also making pivots. Chief executive Carlos Tavares said on Thursday the European auto giant will shift the output of some Leapmotor products to Europe due to the tariff hikes, having reportedly explored the potential of building EVs jointly in Italy. A similar scenario could unfold for Xpeng Motors and its European ally Volkswagen. President Brian Gu last September revealed plans to enter Germany, Britain, and France, with Italy also being included earlier this year.

A Chinese AI content creator has challenged cybersecurity firm 360 Security Technology over its use of an image of a woman wearing an ancient costume, which he claims he created via an AI model to showcase a “partially redrawn feature” on the company’s search engine.

The argument between creator DynamicWang and 360 Security escalated as the two parties failed to settle, with the company’s vice president Liang Zhihui saying it is willing to resort to legal action.

Why it matters: As the emerging technology of artificial intelligence is increasingly being used to create content, authorship attribution lacks a clearly defined legal framework.

Details: Even before DynamicWang publicly asked 360 Security to apologize over the alleged copyright infringement on June 8, the firm was in the midst of a public opinion storm, this time over its perceived disrespect toward women. When founder Zhou Hongyi introduced the repainting function at the company’s AI product launch on June 6, he used “sexy” as a prompt to ask the AI-powered search engine to redraw a woman’s breasts of the female in the controversial picture, which DynamicWang since claimed was based on his AI-generated work.

• The creator said 360 Security should acknowledge the infringement and compensate him with a symbolic RMB 1 ($0.14). He said the firm “stole” the image generated by his self-trained AWPortrait model.
• According to Liang, the author made a request to the company that he wants 360 Security paid him ten times the model price, together with the cost of compensation. 
• Local media outlet NBD quoted DynamicWang as interpreting the price to use his model as RMB 4,499 is for small- and medium-sized AI startups. This was not the price set for public-listed 360 Security, the creator said. 
• Each side has its own version of the story. While the creator mentioned compensation and apology were “prerequisites,” and buying the model was optional, Liang said purchasing the author’s AWPortrait model for ten times the price was “beyond our knowledge,” according to a WeChat screenshot of his conversation with DynamicWang. The current argument between the two sides is whether DynamicWang owns the copyright to the images generated by the model he trained. 
• In his latest Weibo post late Wednesday, the creator introduced himself as a photographer whose images are posted on Unsplash, Getty Images’ free gallery site, and that the training data he used to feed AWPortait model included his photography and Unsplash images, which he says means there are “no copyright issues” on his side.

Context: In January, the Beijing Internet Court granted copyright protection for an artificial intelligence-generated image, ruling that the image involved had an element of “originality” due to the plaintiff inputting multiple prompts and adjusting the parameters before generating a picture of a young woman through the text-to-image AI model Stable Diffusion. The ruling was seen as the first such AI-generated image copyright infringement case in China.

The demand for advanced process chips has surged, as AI servers and high-performance computing (HPC) applications transition to AI phones. Taiwanese media outlet Economic Daily News reported on Tuesday that Apple, Qualcomm, Nvidia, and AMD have almost booked TSMC’s 3nm process to full capacity, leading to a queue of customers extending to 2026.

Why it matters: The rapid evolution of AI technology across multiple sectors has driven a surge in demand for advanced process chips. Increasing orders from major clients is expected to further push TSMC to innovate and develop advanced manufacturing processes. 

Details: Currently, TSMC’s 3nm lineup includes N3, N3E, N3P, N3X, and N3A, according to the Economic Daily News report.

• N3E, which entered mass production in the fourth quarter of last year, primarily serves AI accelerators, high-end smartphones, and data centers. N3P is expected to enter mass production in the latter half of this year and will become the preferred chip process for mainstream applications including mobile devices, consumer electronic products, base stations, and networking by 2026. N3X and N3A are designed for customized demands such as high-performance computing and automotive clients.
• The latest high-end chips this year are all adopting the 3nm process, according to Chinese media outlet Icsmart. Apple will introduce the M4 series processors this year and is set to release the next-gen A18 series processors for its new iPhone16 series this September. Later this year, Qualcomm will launch its flagship mobile platform Snapdragon 8 Gen 4, while Nvidia is set to unveil the RTX 50 series graphics cards. AMD will release the fifth-gen EPYC Turin processors in the second half of the year, with plans to launch the MI350 series next year.
• TSMC, as the exclusive supplier of Apple’s A-series processors for the new iPhones, will see a significant increase in demand for related 3nm orders. Apple’s iPhone 16 series this year is expected to increase sales volume by 5% year-over-year to 92-95 million units, the Economic Daily News report forecasted.
• To ensure stable supply over the next two years, TSMC’s strategy is to convert some of its 5nm equipment to support 3nm production. Industry sources indicate that TSMC is likely to up its production of 3nm wafers to between 120,000 and 180,000 a month.

Context:The total production value of the top ten semiconductor foundries in the first quarter reached $29.2 billion, a decrease of 4.3% compared to the previous quarter, according to market research firm TrendForce.

• In the first quarter, TSMC led with a revenue of $18.85 billion and a market share of 61.7%, followed by Samsung with $3.36 billion and an 11% market share. Shanghai-based chip foundry SMIC took third place with $1.75 billion in revenue and a 5.7% market share.

Li Auto is on track to offer its new level 3 automated driving system within the next 12 months, which would enable hands-free, eyes-off driving under certain conditions, as it transitions towards “end-to-end neural network” architecture, according to chief executive Li Xiang.

Why it matters: The comments mark an increase in competition between Tesla and Chinese automakers over the adoption of autonomous driving. The US automaker is reportedly looking to roll out the latest version of its “Full Self-driving-Driving” software in China, its second-largest market.

• The news also comes as Li Auto started calling back some former staff late last month having previously dismissed roughly 30% of its 1,100-person Autonomous Driving Group in a setback to the company’s launch of its first battery electric model, the Mega. 
• Most employees rehired by the electric vehicle maker work on the NOA (Navigation on ADAS — advanced driver assistance system) function for urban driving scenarios. Vice President Lang Xianpeng on June 7 promised surviving employees from his team that the layoff was now over, sources familiar with the matter told the 21st Century Business Herald (in Chinese).

READ MORE: China opens door wider to Tesla as local giants disrupt the EV sector with AI-defined vehicles

Details: Li Auto will roll out a new version of its NOA software in the third quarter of 2024. This version still requires the driver to be in full control but will not rely on a high-definition map. The company announced that it will launch its city NOA function to users in 100 major Chinese cities in November.

• This will be followed by a wide release of its Level 3 autonomous driving system later this year, or in early 2025, Li told the audience at the China Auto Chongqing Summit on June 8, according to short videos posted on the social media platform WeChat.
• Li said the company has been working on an end-to-end artificial intelligence approach since late 2023. The approach is using video clips from real driving situations as well as machine learning algorithms to handle the vehicles’ control. It is also exploring Visual-Language Models (VLMs), which could better learn patterns and correlate between visual data and natural language than existing offerings.
• Li Auto’s L3 conditional autonomous system will use both approaches, Li said, allowing the human driver not to monitor the vehicle constantly but to be ready to take control, according to the definitions set by the Society of Automotive Engineers (SAE). It could further evolve to a level 4 highly autonomous driving system over the next three years, Li added, without elaborating further.

Context: Automakers in China, including Li Auto, have either been applying for mapping licenses or working with map services in order to collect large amounts of highly detailed geographical data, which helps autonomous vehicles (AVs) make better decisions when performing driving tasks. However, many of them, such as Huawei and Xpeng Motors, are now looking for alternatives due to cost and complexity reasons.

• It is unknown whether Li Auto will take legal responsibility for its upcoming level 3 technology. Last year, Mercedes-Benz became the first automaker allowed to sell cars with its L3 Drive Pilot system in California and Nevada, Reuters reported. China is pushing for similar regulatory initiatives with assistance from automakers including BYD, SAIC, and NIO.
• Li Auto has been working on layoffs since May to cut 18% of the company’s workforce, which stood at roughly 5,600 as of last year, while that percentage for the Autonomous Driving Group was more than 30%, according to the 21st Century report. President Ma Donghui told investors in November the company planned to have 2,000 employees for AVs by the end of 2024. 

READ MORE: Li Auto accelerates assisted driving tech competition amid launch of first battery EV

On Thursday, World of Warcraft announced on Chinese social media platform Weibo that a deletion-based technical test for the Chinese server will begin on June 11, in preparation for the upcoming server launch of the expansion set Wrath of the Lich King. The team also promised players an official China launch later in June.

Why it matters: June 6 marked 500 days since Blizzard’s servers went offline in China and 57 days since NetEase Games announced that a deal had been done to secure their return. Chinese gamers are eagerly following the latest updates on the return of Blizzard games to the mainland China market.

Details: The technical test for World of Warcraft’s domestic servers will last for seven days, with the final launch of the official servers still requiring some time, according to the announcement.

• To celebrate this moment, World of Warcraft’s China team has prepared two rewards for gamers participating in the test: a unique commemorative online pet and an exclusive achievement badge for the Chinese servers.
• On Weibo, some veteran players questioned the need for testing a hit game that has been around for over a decade, while others got emotional at the sight of the login interface of World of Warcraft. Furthermore, many players are urging the prompt return of other popular Blizzard games such as the digital collectible card game Hearthstone and the multiplayer first-person shooter title Overwatch.
• The pressure on servers for relaunching World of Warcraft might surpass that of new game launches, the team said in the announcement. Many players prefer returning to their original servers rather than joining new ones based on server loads. This server preference could result in login pressures on certain servers far surpassing the norm, potentially exceeding the server pressures during the initial launch of a new game, the team explained.
• Testing is also needed for new technology and server capacity expansion, according to the NetEase and Blizzard teams. “Over the past year, the server backend has undergone multiple updates, with new technologies planned for implementation in the future. These upgrades require further debugging in high-pressure environments to ensure smooth operation in the new environment,” the announcement added.

Context: On April 10, China’s NetEase and its US games partner Microsoft announced that they aimed to bring popular Blizzard titles back to China after the former’s falling out with the developer that ended an almost 15-year partnership. The two companies are now working to bring online games from Blizzard Entertainment, a subsidiary of Activision Blizzard which Microsoft bought last year, back to China, starting this summer. 

• NetEase was the publisher of Blizzard games in China from 2008 to 2023.

China’s major southern city of Guangzhou unveiled its action plan on May 31 to boost the development of the so-called “low-altitude economy,” vowing to become China’s first city to commercialize aircraft for passenger transport in low-altitude airspace over the next three years, and it is not alone. Nearly 30 Chinese major city and provincial governments have brought similar initiatives into their work plans for this year as of writing, according to public records.

Chinese regional authorities are responding to Beijing’s call to establish a number of strategic emerging industries as some traditional economic pillars of the country are in recession. Beijing also wants to replicate its success story of electric vehicles from land to sky, as part of its ambition to become a global leader in technological innovations. Among various aircraft from drones to traditional helicopters, flying cars are likely to be a bright spot, and southern China could offer what it takes for that to happen, industry experts said.

What is a low-altitude economy?

Although there is no official definition of what constitutes a “low-altitude economy,” it usually refers to various businesses centered around civil-manned and unmanned aerial vehicles below 3,000 meters in altitude, including manufacturing, flight operations, and services for agriculture, logistics, and tourism.

The idea was first mooted by China’s State Council with an outline for establishing “a national comprehensive transportation network” back in February 2021 and was later listed as one of the strategic emerging industries at the central economic work conference in December.

Compared with China’s traditional general aviation sector, which includes military and commercial flights, a low-altitude economy is characterized by the elements of vertical take-off and landing, green energies, and intelligent piloting, said Burt Guo, CEO of Aerofugia Technology, a subsidiary of Geely.

“EVs in the air”

Electric vertical takeoff and landing aircraft (eVTOL), also known as flying cars, are considered the most promising application, garnering particular attention from investors and entrepreneurs, due to their potential for both passenger and cargo delivery at a presumably lower cost than helicopters. That is not the only reason, though. China is looking to leverage the capabilities that already exist within its EV industry, from supply chain to charging infrastructure, bringing the global competition for emerging technologies from the ground into the air.

“So is it almost like EVs in the air?” “Yes, you get the point,” Guo said when asked by Zheng Junfeng, an anchor of Chinese state television news services CGTN, at the recent BEYOND EXPO 2024 tech event last month in Macao. Guo added that eVTOL could share around 70%-80% of the materials and components with EVs, with the rest being sourced from the suppliers for traditional aircraft, while there is always room for collaboration with its parent company in fields such as manufacturing and charging.

“It’s kind of an ecosystem for new energy transportation,” Guo said. Geely led a €50 million ($55 million) funding round into Volocopter in 2019 and the German air taxi startup set up a joint venture with Aerofugia two years later.

It also represents a more cost-effective solution for urban transportation compared with subways and bypasses. Each parking garage and building rooftop in the city could be “ideal” for flying vehicles to park and refuel, according to Jian Dan, executive vice general manager of Civil Aviation Investment Fund, led by the parent of Beijing International Airport Co Ltd (our translation). “It is totally different from helicopters,” Guo echoed, saying the landing space would be “considerably smaller” than what a traditional helicopter uses.

Although consulting firm McKinsey in 2020 estimated it would cost $200,000-$400,000 to build a takeoff and landing area along with two spots for parking or vehicle maintenance, Jian believed the smallest location of such kind could be as cheap as “several thousand RMB.” Guo said a flying car would cost 30% of a helicopter, even as the technology is still in the early stages, and in the end, the cost of a trip by eVTOL could plunge to roughly two to three times that of a taxi.

Still a distant future

Although the industry is growing at a faster pace, it could take at least three to five years before flying vehicles get commercialized, mainly because most players are still navigating technological challenges and regulatory hurdles, experts said. The International Air Transport Association (IATA) expects 5% carbon emission reductions globally by 2030 through the use of sustainable aviation fuels, innovative new propulsion technologies, and other efficiency improvements.

Electric planes are definitely the future of aviation, but the technology is not ready yet, and the battery is one of the key issues, Zhou Lisha, CEO of Chinese battery startup Montavista, told the audience at the BEYOND EXPO 2024. “Companies have to prove every inch of their aircraft is safe, and one of the tests is to make sure the batteries won’t catch fire, because you can’t stop or pull to the side of the road when something goes wrong,” said Zhou.

For that reason, governments are implementing highly stringent rules and safety standards for electric and autonomous aircraft. China has set a goal for businesses to mass produce lithium-ion batteries that meet aviation safety standards with an energy density of 400 watt-hours per kilogram (Wh/kg), as part of a development plan through 2035 released by four top government bodies late last year. For comparison, CATL’s latest Qilin battery reportedly has an energy density of 255 Wh/kg.

Operating air taxis in low-altitude urban airspace may also encounter many conflicts with high-rise buildings within a volatile electromagnetic environment. There has to be new telecommunication infrastructure facilities and a new air traffic control system to support the operation of those unmanned aircraft, according to Jian. “It is definitely not feasible for those machines to communicate with air traffic control via radio,” Jian said at this year’s BEYOND EXPO.

Guangdong: a major staging ground

The Chinese government is jumping in to offer some help. Guangzhou said it will keep “close connections” with eVTOL makers and provide “necessary assistance” to them, when it comes to issues related to research and development, and airworthiness certification, among others. The capital city of southern Guangdong province also plans to build at least five eVTOL airport terminals, known as vertiports, as well as 100 takeoff and landing spots by 2027.

Headquartered in Guangzhou, US-listed Ehang said in October it received an airworthiness “type certificate” from the Civil Aviation Administration of China, CNBC reported, while Xpeng AeroHT, an affiliate of local EV maker Xpeng Motors, followed suit by submitting its application in March. AutoFlight, another Shanghai-based startup, reportedly hit a milestone early this year when its five-seater Prosperity aircraft completed a low-altitude flight between the southern cities of Shenzhen and Zhuhai in the Guangdong province.

Guo expects the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) to be the first region in the country where its flying vehicles will be available. “If you take a taxi from here (Macao) to Shenzhen it takes one to two hours. That will be only around 15 minutes if you use a flying vehicle,” Guo said.

READ MORE: Beyond Expo | Self-flying cars are closer to being realized than self-driving cars: Geely executive

Chinese artificial intelligence company Zhipu AI on Wednesday announced its second price cut in a month, slashing the price tag of its “most popular model” by more than half. The company said it would now offer its GLM-4 model at a charge of RMB 0.10 ($0.014) per 1,000 tokens, but CEO Zhang Peng insisted the move was not part of “a simple price war.”

Why it matters: Offering ever lower prices to capture market share characterizes China’s AI sector at the moment, where over 200 large language models have been released since October 2023.

Details: Tokens are sequences of data that large language models use to process text. GLM-4-0520, the most advanced model built by Zhipu AI, has a context window of 128,000 tokens with RMB 1 for every 10,000 input tokens. The price of this advanced model was cut in May.

Generally, 1,000 tokens are equivalent to around 750 English words or 500 Chinese characters.

• The deep discounts are a result of “iterations of the models’ core technologies,” Zhang said at a Zhipu AI open day on Wednesday. In an interview on the same day, Zhang was quoted by local media outlet TMTPost as saying, “not only can we join [the price war], but we can do it without losing money.”
• The company, which is backed by leading Chinese academy Tsinghua University, has disclosed that it currently serves 300,000 enterprise-level customers, and on average its model family processing exceeds 40 billion tokens daily.
• On the consumer side, the firm has a GenAI app called Zhipu Qingyan that is powered by the company’s foundation model ChatGLM, with the app already having amassed 300,000 AI agents that can perform tasks such as creating mind maps and making schedules since its launch last August, the company said.

Context: Zhipu AI has received at least nine rounds of financial injections from Chinese state-backed funds, major tech companies, and well-known venture capital firms since it was founded in 2019. Those supporters include Alibaba, Tencent, Sequoia, and Hillhouse.

• The Beijing-based company also acts as an investor and has invested in seed and angel rounds in rival ModelBest, a firm similar to Zhipu AI that was founded by Tsinghua University graduates. 

TikTok eyes a shopping sales goal between $12 billion and $13 billion for the second half this year in the US, according to a 36Kr report on Tuesday. The high target was set after the short video platform fell far below expectations in the first five months.

The report quoted key data from Tabcut, a Chinese firm that tracks TikTok Shop’s performance, indicating that TikTok generated less than $2 billion in the US shopping business from January to May 2024.

Why it matters: The potential ban TikTok faces in America seems to have already hurt its growing e-commerce business in its largest user base country.

Details: TikTok, the international version of Douyin, was reportedly hoping to expand its US e-commerce business tenfold to as much as $17.5 billion this year, according to a January report from Bloomberg. TikTok has so far only accomplished 11.4% of its GMV goal in the past 5 months, the 36Kr report said.

• TikTok hosted a small closed-door meeting in Shenzhen in mid-May, 36Kr added, where it invited its key domestic sellers to convey a message that the platform “remains optimistic about its prospects in the US market despite facing a political headwind.” The company also assured attendees that TikTok has comprehensive contingency plans in place even in the “worst-case scenario.”
• As the latest effort to counter the US government’s request to divest or ban the app, TikTok parent ByteDance has appointed John Rogovin, a former lawyer of Warner Bros, as its global general counsel. The company sued the US government in May with the aim of blocking a law requiring it to sell its US operation or face a total ban. In the appointment announcement, TikTok said Rogovin will report to ByteDance CEO Liang Rubo, and indirectly to TikTok chief Shou Chew.

Context: TikTok Shop officially entered the US market in September 2023, although little official data has been given to the outside world regarding its merchants and sales. The platform has grown to 170 million users in the American market, according to figures released in January,  up from 150 million last year.

Two authors behind a Stanford University AI project have apologized to the Chinese team behind open-source AI model MiniCPM-Llama3-V 2.5 after social media users in China outed the former for having plagiarized the latter model, which was developed by Tsinghua University and ModelBest Inc. The incident sparked widespread discussion on the Chinese internet.

Two authors of the Stanford Llama3-V team, Siddharth Sharma and Aksh Garg, today apologized to the MiniCPM team on social media site X for their academic misconduct, announcing they would withdraw the Llama3-V model from use.

Why it matters: Members of the Stanford team acknowledged they had plagiarized Tsinghua University and ModelBest Inc’s work. 

Details: “We sincerely apologize to the authors of MiniCPM for our failure to verify the originality of Llama3-V,” Aksh and Siddharth wrote on X today. “Mustafa, who wrote the code, described exciting extensions that we promoted without knowing about the prior work by OpenBMB (founded by Tsinghua University and ModelBest Inc). We take full responsibility for this oversight. We’ve removed all references to Llama3-V in respect to the original authors.” 

• On May 29, a Stanford AI team claimed online that they could train a multi-modal large model surpassing GPT-4V for only $500, according to local media outlet Quantum Bit. Subsequently, social media users discovered that the team’s Llama3-V model used a model structure and code highly similar to ModelBest’s MiniCPM-Llama3-V2.5, with partial variable name modifications. Llama3-V also features the same tokenizer as MiniCPM-Llama3-V 2.5, including the latter’s newly defined special symbols.
• On June 2, Chinese firm ModelBest Inc confirmed that the Stanford large model project Llama3-V, similar to MiniCPM, is able to identify Qinghua Jian ancient Chinese characters from China’s Warring States Period. Remarkably, the matches also shared identical mistakes. This character data, obtained by the research team through months of scanning and manual annotation of each Qinghua Jian character, had not been publicly disclosed, confirming the act of plagiarism.
• “While it’s good to be recognized by international teams, we believe in building a community that’s open, cooperative, and trustworthy,” ModelBest Inc CEO Li Dahai stated. “We want our team’s work to be noticed and respected, but not in this manner.”
• ModelBest Inc’s chief scientist, Liu Zhiyuan, who is also a tenured associate professor at Tsinghua University, told an Yicai reporter that the rapid development of artificial intelligence relies on the global sharing of algorithms, data, and models. “Two out of the three members of this Llama3-V team are merely undergraduate students at Stanford University, and they have a long journey ahead. If they can acknowledge their mistakes and make amends, it would be a great virtue,” he said.
• Christopher David Manning, the director of the Stanford AI Laboratory, also issued a statement condemning the act of plagiarism and praising the Chinese open-source model MiniCPM.

Context: Founded in August 2022, ModelBest Inc secured a new round of financing worth hundreds of millions of RMB in April. Huawei’s Hubble Technology Venture Capital led the investment, with participation from Chunhua Capital, Beijing Artificial Intelligence Industry Investment Fund, and Chinese Quora-like platform Zhihu. In February, ModelBest Inc launched the open-source model MiniCPM.

Major Chinese automakers reported higher electric vehicle sales for May than in April, boosted by new government subsidies and the continued use of discounts to lure cost-conscious shoppers. Notably, NIO and Geely’s Zeekr were among the top-performing companies in the market, reporting their best-ever monthly deliveries.

Why it matters: The latest sales figures marked a swift turnaround for Chinese auto majors as they have been mostly grappling with weak consumer sentiment and intensifying competition in recent months.

• Demand was mainly boosted by China’s new subsidies encouraging consumers to trade in their old, less eco-friendly vehicles for new more energy-efficient ones. Meanwhile, several regional trade events have garnered more consumer attention than usual and boosted the appetite for new models, such as the recent Beijing Auto Show, wrote the China Passenger Car Association (CPCA) on May 29.

Details: Both NIO and Zeekr witnessed triple-digit growth year-on-year in May, with monthly deliveries reaching a record high.

• NIO said on June 1 that it surpassed the 20,000 vehicle sales limit last month for the second time since its inception, with its delivery numbers up 31.5% from April. The growth was driven by additional cash rebates totaling RMB 1 billion ($138 million), offered by the company in the name of car trade-ins since April 1, as well as a more than 25% price cut on its battery leasing program in March.
• Zeekr’s May deliveries reached 18,616, up 16% in a month, thanks to strong demand for its redesigned 001 shooting brake, of which sales surpassed 10,000 units for two months since delivery began on March 1. The Geely affiliate on May 10 became the fourth Chinese EV maker to go public in the US. Sales at its parent company also picked up momentum to 58,673 units over the month.
• Meanwhile, Li Auto saw its best-ever monthly sales this year in May, buoyed by a recent price reduction of up to RMB 30,000 on its existing vehicle lineup and the strong demand for the L6, which went on sale in mid-April. The company said the L6 accounted for more than 15,000 units out of its total deliveries in May and that it expected the number to surpass 20,000 units in June.
• Sales of Huawei-backed EVs took a slight hit in May while the Chinese tech giant was busy launching the redesigned versions of its existing Aito cars with partner Seres. Huawei’s Harmony Intelligent Mobility Alliance (HIMA), which currently consists of Aito and Luxeed series models, reported combined deliveries of 30,578 units last month, up 3.2% from April, with no breakdown.
• State-owned manufacturers Chery and GAC’s Aion also reported strong May sales, as both companies introduced big discounts in a move to respond to Beijing’s call to boost consumption. Chery on May 9 began selling the Sterra ET crossover at a competitive starting price of RMB 189,800.
• Xiaomi reported a 22.3% improvement in deliveries from April and aims to deliver more than 10,000 units starting in June.

Context: Retail sales of new energy passenger vehicles, which include all-electrics and plug-in hybrids, increased 27% year-on-year and 2% month-on-month to roughly 574,000 units during May 1-26 in China, when passenger car sales fell slightly to 1.2 million units, the CPCA figures showed.

• BYD, by far the dominant player in the market, on May 4 began offering subsidies of up to RMB 8,000 to consumers trading in their old cars. The auto giant on May 28 rolled out two new models with a driving range of 2,100 kilometers (1,305 miles), enabled by its latest plug-in hybrid technology.

Tencent on Thursday launched an AI assistant app called Yuanbao, signaling the Chinese tech giant’s belated entry into the highly competitive artificial intelligence assistant field with an independent entry based on the company’s Hunyuan foundation model.

Yuanbao integrates artificial intelligence-based search, summaries, and writing competencies, and can be used to analyze documents, and basically engage with people based on prompts.

Why it matters: The opening of the independent app shows that Tencent has finally chosen to face competition head-on, several months after AI offerings from its rivals. Baidu’s ERNIE Bot has already amassed 200 million users, while ByteDance’s Doubao currently boasts over 26 million monthly active users.

Details: Tencent’s Yuanbao distinguishes itself from Baidu, Alibaba, and ByteDance’s products by offering direct access to content from the WeChat ecosystem, the company’s super app with nearly 1.4 billion monthly active users, which the firm says will give it superiority in terms of content timeliness and richness.

• WeChat, the all-in-one app, features a fan page functionality similar to Facebook’s, known as Official Accounts, where individual creators or enterprises can publish articles or information to subscribed users. The content cannot be directly accessed through mainstream search engines such as Baidu.
• Since its launch in September 2023, the parameter scale of Tencent’s Hunyuan large model has been upgraded from hundreds of billions to trillions, according to Tencent, and the pre-training corpus has increased to 70 trillion tokens.
• Based on the published guidelines of the Yuanbao app, the consumer-oriented assistant currently offers multiple AI agents, similar to GPTs, which can be selected for various functions, including English-speaking practice, daily life translation, and avatar generation.

Context: Last week, Tencent announced that it had made the lite version of its Hunyuan model free to access, while the price of its more powerful version has been reduced by 50% to 87.5%, as the firm joined a fresh price war among major Chinese tech companies.

• Tencent’s announcement comes just hours after iFlytek said its SparkLite API would be permanently free. In an interview with TechNode at the BEYOND Expo 2024, the firm’s vice president Wang Wei mentioned that the decision was made because “iFlytek should have a sense of social responsibility as a major company by making [AI] technology available for broader applications.”

On Wednesday, Chinese PC maker Lenovo announced a strategic partnership with Alat, a subsidiary under Saudi Arabia’s Public Investment Fund (PIF) focused on transformative technology investments and sustainable manufacturing, with Alat proposing a $2 billion zero coupon convertible bonds investment in Lenovo. 

Lenovo will establish its Middle East and Africa (MEA) regional headquarters in Riyadh, the capital of Saudi Arabia, which will include a customer center and R&D center for the region. The company will also build a new manufacturing base for personal computers and servers in Saudi Arabia.

Why it matters: As a wholly-owned subsidiary of PIF, Alat aims to leverage this collaboration to drive industrial transformation in Saudi Arabia, positioning the country as a world-class hub for sustainable technology manufacturing. Lenovo will look to increase its presence in the MEA region via the partnership.

Details: Lenovo will issue $2 billion in convertible bonds to Alat, using the proceeds to repay debts and for corporate purposes, according to the announcement. 

• The bonds mature in three years and can be converted to equity at HK$10.42 ($1.33) per share, a 10% premium over the 30-day average VWAP (Volume Weighted Average Price). Issuance is contingent on Lenovo shareholder and regulatory approvals. Currently, Lenovo has approved a proposal to issue 1,150,000,000 warrants at a price of HK$1.43 ($0.18) per warrant, according to the statement.
• PIF, a sovereign wealth fund, manages assets exceeding $700 billion, according to Lenovo. The agreement between the two parties stated that Alat will have the authority to nominate a non-executive director candidate to join Lenovo Group’s board of directors through the customary director appointment procedures of Hong Kong.
• “Through this powerful strategic collaboration, Lenovo will have significant resources and financial flexibility to further accelerate our transformation and grow our business by capitalizing on the incredible growth momentum in the MEA region,” said Lenovo CEO Yuanqing Yang.
• “As Lenovo establishes its regional headquarters in Riyadh and a clean energy manufacturing base in Saudi Arabia, we expect its growth to accelerate in the MEA region,” said Alat CEO Amit Midha.

Context: In the first quarter, global PC shipments increased around 3% year-on-year to reach 57.1 million units after eight consecutive quarters of decline, according to market research firm Counterpoint Research. Lenovo secured the leading position in the global market with a 24% share, reaching 13.7 million units, up by 8% year-on-year.

• The market intelligence firm IDC predicts that the IT and business services market in the MEA region is expected to reach nearly $38 billion in 2027, driven by the continuous increase in large-scale projects and rapid economic development in the region.

China’s online retailer JD said it will hold a one-day 2 yuan ($0.28) campaign for millions of goods with free shipping during this year’s 618 event, set to begin on Friday, as cheap remains a main theme across the country’s e-commerce marketplaces and consumers care priorities.

Why it matters: The market pressure that JD faces has now intensified as Pinduoduo, which operates on the principle of low prices and user-friendly after-sales service, continued to nibble away at what was once China’s second-largest e-commerce retailer by market capitalization.

• Rarely seen in public, founder Richard Liu has recently returned to media headlines for his wolfish statements within the company. As JD rushes for its most important 618 event, Liu’s remarks on the company’s tendency to fire underperformers who don’t work hard have raised concerns about its ability to maintain growth.

Details: The company had a press conference about the 618 mid-year shopping festival on Tuesday, where JD promoted it will provide “saving to the extreme and cheaper shopping experiences” to customers.

• When JD and Taobao try to provide more cash subsidies to shoppers, Pinduoduo more straightforwardly implements its low-price advantage by urging merchants to cut prices, with those who do so getting higher search rankings during the shopping festival. The price war that has permeated the industry in the past two years seems like a bottomless pit for e-commerce participants.
• At the press event, JD invited several of its sales and procurement staff, a group responsible for finding products that cater to users’ interests, to bargain at minimal cost with suppliers, and finally promotes to shoppers, to share their work publicly. The sales and procurement employees have been frequently thrust into the public eye by JD after livestreaming conducted by some of them last Singles Day found initial success for the company that had seldom participated in live-commerce before.
• JD said in the latest official WeChat post that rich commodities, affordable prices, and careful services of its 618 festival are the result of the “tireless efforts” of this group of employees, just one day after the company announced a gradual annual fixed salary for procurement staff to 20-month pay.

Context: Sandy Xu, the current CEO of JD, revealed that its “10 billion yuan subsidy” channel has amassed over 100 million users since launched last March, while more than one million third-party sellers have operated online stores on the platform, which is in contrast to itself in previous years when JD’s self-operated stores the main within its ecosystem.

BYD on Tuesday unveiled its latest-generation plug-in hybrid platform DM-i 5.0. The company said the technology gives its newest models a driving range of 2,100 kilometers (1,305 miles) at a starting price of only RMB 99,800 ($13,772), an advance that will likely accelerate China’s transition from fossil fuels to green vehicles.

Why it matters: The launch comes after figures from the China Passenger Car Association (CPCA) show that new energy vehicles (NEVs), most of which are battery electric vehicles (BEVs) and plug-in hybrids, represented more than half of China’s personal vehicle market in the first half of April.

• The surpassing of the 50% mark in vehicle registrations in China came for the first time in the week of May 13-19 in a historic moment. The milestone means that NEVs are now mainstream in the country, BYD Chairman Wang Chuanfu claimed on Tuesday, citing official figures (our translation).

Details: BYD said its fifth-gen dual-mode (DM) hybrid technology features an integrated system that covers all aspects of thermal and energy management, comprising cooling modules for front-end body parts, batteries, and in-car infotainment software.

• China’s biggest EV manufacturer also announced a breakthrough among production vehicles for their gasoline engines worldwide, as its new PHEVs can potentially convert 46.06% of the thermal energy they produce during combustion into mechanical energy, indicating a more efficient performance than rivals’ offerings.
• The company said it has also managed to reduce the excessive energy consumed in extreme weather conditions and achieved fuel consumption of 2.9L/100 km with an empty battery on the new platform. This gives its Qin L and Seal 06 compact sedans a driving range of 2,100 km on a full tank and full charge.
• The Qin L sedan, first unveiled at this year’s Beijing Auto Show, measures 4.8 meters in length and spans a 2,790-millimeter-long wheelbase. It comes as a mid-range offering between the Qin Plus and the more premium Han under the Dynasty family that accounted for nearly half of BYD’s sales last year.
• The Qin L has a similar-sized sibling, the Seal 06 DM-I, which is characterized by a more sleek and sporty design to attract younger customers. Both models have five variants respectively, providing an all-electric driving range between 80 km and 120 km and are priced between RMB 99,800 and RMB 139,800.

Context: A growing number of automakers in China are pivoting their efforts to develop PHEV models, as BEVs remain on a slow growth trajectory. Sales of PHEVs, which include extended-range hybrids (EREVs) in China, surged 64.2% year-on-year in April, compared with the 12.1% growth rate achieved by BEVs, CPCA figures showed.

• A week earlier, Chery launched the Fulwin T9, a plug-in hybrid crossover with a similar price range to BYD’s Song Plus, while Dongfeng unveiled its latest answer to the popular crossover, the Aeolus L7, with an estimated 1,500 km of driving range.
• Geely and Changan sell PHEVs under their Galaxy and Deepal lineups, respectively, while international majors from Volkswagen to Toyota are reportedly accelerating their steps to introduce such offerings in China.

READ MORE: Chinese officials reaffirm commitment to EV ambitions and promise raft of support measures amid industry doubts

Macao is playing a positive role in facilitating the entry of Chinese electric vehicle makers into Portuguese-speaking countries, global accountancy firm Deloitte said in a recent report. 

The report, released on May 23 at the BEYOND EXPO 2024, reflected the growing presence of Chinese cars in global markets and the strategic role of Macao in enabling these moves. GAC’s EV unit Aion also showcased its latest offerings during this year’s expo, as its state-owned parent company, which is also a manufacturing partner of Toyota and Honda in China, sets its sights on global expansion and targets vehicle sales of 1.1 million units of its own brands this year. 

Macao could harness the abundant talents with language expertise and knowledge of law from Portuguese-speaking countries to facilitate Chinese new energy vehicle (NEV) manufacturers’ entry into these markets, Deloitte wrote in the Chinese language report. “The city could also leverage its mature exhibition facilities and experience […] to provide a platform for cooperation and exchange between China’s NEV industry and overseas markets,” said Norman Sze, vice chair of Deloitte China in a press release (our translation). 

The comments come as Chinese EV giant BYD is rushing to produce EVs locally in Brazil, the largest economy in Latin America and a major Portuguese-speaking nation, with operations of its $600 million industrial complex expected to begin in the middle of this year. Rival Great Wall Motor also reportedly started operations of its Iracemapolis plant in the country this month, while Chery, one of China’s largest automobile exporters, opened its first overseas factory in Jacarei in Sao Paulo back in 2014, reported China Daily.

Deloitte forecast that Latin America, which accounts for 6% of total car sales worldwide, could reach sales of roughly 7.2 million passenger cars in 2030 with a solid growth rate of 5% year-on-year through the end of the decade. Meanwhile, around 5% of total car sales could be electric in the region in 2025, up from the current 2%, thanks to stimulus measures from major countries and a growing base of middle-class consumers, according to the consultancy firm. 

Held between May 22-25 in Macao, this year’s BEYOND EXPO had a theme focused on Latin America for the first time, as the Chinese Special Administrative Region has historically had close and extensive relations with Portuguese-speaking countries. The Asian tech event hopes to become a bridge for communication between Chinese enterprises and South American markets, according to co-founder Jason Ho.

Some of the hottest emerging technologies, including artificial intelligence and the metaverse, are expected to facilitate the significant reduction of greenhouse gas emissions from businesses. However, it would require large amounts of data and professionals to achieve this goal, experts said on May 25 at the BEYOND EXPO 2024. 

A large language model, or LLM, consisting of neural network algorithms for analyzing vast amounts of datasets, summarizes information and creates sophisticated output at a speed much faster than human counterparts. This could automate workflows for carbon capture and carbon trading, said Chen Nan, deputy director of the Research Institute at SinoCarbon Innovation and Investment Co., Ltd. 

However, experts warned that information generated by those language models could sometimes be inaccurate and unreliable, making the involvement of professionals in training models essential. 

“When we use AI to improve the operation of a wind power plant or select an ideal site for some renewable energy facilities, we normally expect something more precise,” Chen said. 

AI-driven carbon reduction

According to Chen, AI-enabled carbon emission management is promising for commercialization in areas including carbon accounting and carbon trading. 

Carbon accounting, the process of quantifying greenhouse gas emissions, can be complex due to variations across regions and industries. Different places and industries have varying standards, guidelines, and requirements, “creating a high bar for many industry people.” 

AI could assist in identifying relevant guidelines and standards while highlighting their differences based on specific scenarios. However, Chen said it would only work if professionals were involved in providing specific model training guidelines to analyze and compare them. 

Businesses also face challenges in fulfilling their reporting obligations to the European Union’s Carbon Border Adjustment Mechanism, a tool designed to address carbon leakage from non-EU countries. In such scenarios, Chen said LLMs could be of great help. 

Although regulators provide detailed rules for calculating embedded emissions during the production process of CBAM goods, AI could help importers understand where and how to fill in the necessary information, Chen added.

Meanwhile, AI could also help facilitate international carbon trading. While financial mathematical models have traditionally been used to predict carbon market prices, AI could enhance the carbon trading approach with more comprehensive and specific strategies. 

However, AI would require guidance from human experts, who would provide such systems with knowledge related to relevant policies, regulations, and specific trading rules, Chen said. 

AI + the metaverse

Experts argue that new energy-saving measures for businesses could emerge by leveraging AI and the metaverse. 

“Training Al in metaverses will become the new paradigm for Al research and development,” Yuan Yu, director at the Metaverse and Digitalization Promotion Center of Tsinghua Industrial Research Institute, told the audience.

Industry experts said that the metaverse could provide a training environment with lower costs and risks, as well as higher efficiency and diversity. This would, therefore, help boost the development of Al for addressing climate change. 

One of the first sprouts of this new paradigm includes testing autonomous vehicles under various complex road conditions in a virtual world, which has already become a common industry practice.

The industrial metaverse can also be an effective tool in the fight against climate change, driven by digital twin technologies, a virtual representation of a physical object, system, or process. 

“Long-term climate predictions are notoriously challenging due to the complexity of interactions among various factors,” said Ralf Ma, general manager of Beijing Miaorun Technology Co. Ltd. “A high-quality replica of our planet could enhance our ability to forecast climate patterns.”

On Friday, BEYOND EXPO organizers invited a group of distinguished entrepreneurs for the Asia-Latam Tech Forum, aiming to explore opportunities for collaboration in business and technology, while promoting cultural exchange and understanding between Asia and Latin America.

The Asia-Latam Tech Forum featured discussions on trade, investment, innovation, and ideas, providing a platform for stakeholders from both continents to explore avenues for growth and prosperity. 

Below are key insights from the three discussion panels held during the forum. 

Panel 1: Latam: The next hotbed of venture capital investments

William Mimassi Pedroso is a partner at Monashees, an early-stage venture capital firm, where he has worked since 2020 and manages relations with the company’s limited partners globally. Pedroso has worked in various capacities, from law to CFO roles, in Brazil and China. He holds a law degree with honors from the University of São Paulo, with proficiency in multiple languages. 

Founded in 2005, Monashees is a renowned early-stage venture capital firm in Latin America. The company invests in innovative startups across various sectors, providing crucial support and resources for their growth and success. With a strong track record, Monashees is a leading player in the region’s vibrant startup ecosystem.

Pedroso expressed optimism about Latin America’s potential for growth in the venture capital sector, given the region’s favorable regulatory environment and increasing digitalization. He highlighted areas such as fintech and clean tech as particularly promising, noting the region’s natural resources and innovative potential. However, he acknowledged that the need for technical talent and English proficiency among developers remains a challenge. 

Pedroso said he sees Latin America as a burgeoning market with ample room for expansion, especially with the right investments and support.

Panel 2: Latam’s innovation ecosystem and collaboration opportunities with Asia

Ingrid Barth is a seasoned economist and entrepreneur with a background in finance, technology, and advocacy. Formerly with JPMorgan and Santander, she founded Linker, a pioneering digital bank for businesses, later acquired by Omie. Additionally, she holds influential roles in fintech regulation and startup development, including representing Brazil in G20 initiatives.

During the panel discussion, Barth spoke about effective communication methods in changing perceptions about Brazil’s business landscape. She advocated for highlighting Brazil’s strengths, such as its innovative potential and natural resources, to attract foreign investors and foster collaboration. 

Barth stressed the need for confidence in Brazil’s capabilities and encouraged entrepreneurs to seek the right local partners when entering the Brazilian market. She also underscored the significance of understanding cultural nuances and navigating regulatory frameworks. 

Barth admitted the role of public policies in shaping business environments and suggested learning from China’s dynamic ecosystem and strategic initiatives. Meanwhile, she called for a proactive approach to showcasing Brazil’s opportunities and fostering international partnerships for mutual growth.

Panel 3: Rising unicorns and IPOs in Latam

Eduardo L’Hotelier, a Brazilian computer engineering graduate, founded GetNinjas in 2011, growing it into Latin America’s largest service marketplace. He led multiple successful fundraising rounds with renowned firms like Monashees Capital and Tiger Global. In 2021, L’Hotelier took GetNinjas public on the Brazilian stock exchange (NINJ3) but sold his stake in the company in January 2023.

GetNinjas is a Brazilian online platform connecting clients with freelance professionals in various fields, including home services, events, classes, and more. The company has revolutionized how people find and hire services, simplifying the lives of millions of users in Brazil.

L’Hotelier attributed Latin America’s booming market to being fueled by its young demographic and tech adoption. He said Brazil’s robust social media usage offers ample opportunities for startups, adding businesses need to understand local laws and culture, while partnerships help to navigate the market. 

L’Hotelier also noted the growing interest from Asian investors in Latin American startups, particularly in Brazil. He said that Brazilian entrepreneurs demonstrate resilience despite bureaucratic hurdles, adding that there is a shift toward a global mindset with more startups eyeing international expansion.

L’Hotelier said the company wishes to help their global partners achieve similar results by leveraging their expertise and technological advancements.

Renowned Japanese technology companies including Sony and Fujifilm on Thursday showcased their latest products and business solutions at the BEYOND EXPO 2024 tech conference in Macao, voicing their expectations for the future of collaboration with China.

The public appearances at one of Asia’s largest tech events is the latest example of the world’s fourth-largest economy looking to not only continue its legacy of tech innovation but also evolve into an entrepreneurial and startup destination.

“Japan has implemented a range of policies designed to support overseas startups and these include substantial subsidies for research and development,” said Yuya Makino, Japan’s Guangzhou consulate-general, during the event. With a gross domestic product of more than $4.2 trillion, the Asian economy has also witnessed a dramatic increase in venture capital investment over the past several years, according to Makino.

“I think we’ve been eclipsed by China and markets like India and Southeast Asia over the last 15-20 years or so, but now there’s enough momentum to boost Japan’s innovations both from the private and public sectors. That’s the big thing that we’re starting to see in Japan,” Akio Tanaka, partner at investment firm Headline VC, told the audience.

Meanwhile, many big Japanese corporations are looking to keep up investments in China in order to retain a presence in the country, with its huge population and big potential, said Jie He, China office representative of Global Brain Corporation, a Tokyo-based venture capital firm. For instance, some are looking to the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) as a business possibility because of its huge population, said Kenichi Okada, Japan’s Hong Kong consulate-general.

Below are some of the innovative efforts presented by companies at the Japan Tech Forum during this year’s BEYOND EXPO, held in Macao between May 22-25.

Sony introduced a project using haptics technology for entertainment that was materialized in the form of a floor, and said walking on the floor would provide users with realistic and captivating sensations of various walking terrains. The company’s engineers packed sensors and motors in the floor to accentuate the experience. It can be made to emulate desert and ice and create immersive and interactive experiences for theme parks, art museums, and livehouses.

The company has had an extensive and in-depth research and development plan for China, ranging from entertainment to mobility and elderly care, according to Takenaka Mikio, a vice president of Sony (China) Limited.

Fujifilm shared the company’s story of technological innovation with an open mindset. The Japanese company established an open innovation hub in 2014 in hopes of creating value that “would illuminate the future with its business partners,” said Yonghua Shi, corporate communication director at FUJIFILM (China) Investment Co., Ltd. One of the examples from the hub was a joint development effort between Fujifilm and Daikin. With the use of ventilating soundproofing material from Fujifilm, Japan’s air-conditioner manufacturer managed to reduce operating noises of its products by over 20%.

A similar entity was also established in Shanghai in 2020, followed by the launch of Fujifilm’s innovation program in China for the first time last year in partnership with ReGACY Innovation Group, in order to accelerate its technology-driven business development.

Tokyo-headquartered chemical maker Asahi Kasei presented a new optical transparent resin called AZP, which has optical characteristics not possible with existing transparent resins. It is widely expected to serve as a next-generation material that can take the place of optical glass. The AZP lenses can be used in VR (Virtual Reality) headsets to provide a larger field of view by polarization-based optical folding, allowing more compact headsets. The technology boasts reduced ghosts and flares, as well as improved contrast, making possible a clear field of view by minimizing the effects of birefringence, a phenomenon of double refraction.

China’s Gotion High-tech on May 17 unveiled a Tesla-like yet cheaper cylindrical battery as well as a more common prismatic battery with ultra-fast charging among its latest products.

Additionally, the Volkswagen-invested battery maker announced its participation in the global race to make all-solid-state batteries, as China looks to catch up with rivals in producing an alternative battery success story. Speaking to reporters during its annual technology conference, Gotion’s management stated that the company would continue its global expansion despite uncertain geopolitical conditions.

New batteries

Gotion is aiming to begin mass production of its new larger-format 4695 cylindrical battery – which is 46 millimeters in diameter and 95 millimeters in length – in the fourth quarter of this year. Shipment will then begin first to overseas markets, said Cheng Qian, president of the firm’s Asia-Pacific business unit.

The nickel cobalt manganese (NCM) battery cell targets producers of luxury vehicle models that look to provide their owners with an unbeatable driving range and charging speed. It has an energy density of 285 watt-hours per kilogram (Wh/kg), charges from 10% to 70% in nine minutes, and maintains at least 70% capacity for 2,500 cycles at room temperature, said Gotion. 

A vertical integration strategy is behind the battery’s cost advantage over rivals, according to Gotion. The Chinese battery maker has reduced dependency on external sources for raw materials including for its cathodes and anodes, ensuring relatively stable production in eastern China’s Anhui province. It also handled 300,000 tons of old batteries last year in an effort to make the most of recyclable metals including nickel and cobalt.

Gotion also announced it has begun making at scale its so-called “G-Current” battery, which could provide a 5C charge rate and allow it to recharge from a low state of charge to 80% in less than 10 minutes. The prismatic rectangular batteries will be available to customers for various battery chemistries including NCM and cheaper lithium iron phosphate (LFP). 

The G-Current is expected to meet surging demand for ultra-fast charging in the Chinese market, not just for battery-powered EV owners but for those driving plug-in hybrids. At least “several” gigawatt hours (GWh) of the capacity will come into force later this year for batteries supplied to clients with their PHEV models, Cao Yong, vice president of Gotion’s Engineering R&D Institute, told reporters (our translation).

The company also gave updates about an LFP product containing manganese. It plans to supply two international clients as early as the third quarter of this year with the product, with more than a dozen carmakers testing the LFP. A 140 kilowatt-hour (kWh) battery pack, first unveiled to the public last year, could power an EV for more than 1,000 kilometers (621 miles) on a single charge.

All-solid-state battery 

Gotion is hoping to start trial production of all-solid-state batteries by 2027 and is aiming for volume production by 2030, it was revealed, with the company publicly sharing its progress in the key emerging technology for the first time. The prototype battery cell has 30 Amp-Hours (Ah) of capacity and an energy density of 350 Wh/kg. The pack is set to reach 280 Wh/kg at a systemic level, giving it a driving range of 1,000 kilometers (621 miles) on a single charge. 

Like its Japanese rivals, China’s fifth largest EV battery maker by shipment is matching sulfide-based solid electrolytes, which theoretically gives the battery a high ionic conductivity, with silicon-based anodes, a non-toxic and promising active material, according to Pan Ruijun, a technical lead at Gotion. The company said the 3000-charge battery maintains thermal stability at 200°C above operating temperature.

Pan expects Chinese companies to shape the future of solid-state batteries globally, not only because the government is ramping up support for their development, but also because China is a major source of key raw materials. Japan is by far the leading force in this innovation, with Toyota aiming for deployment as early as 2027. Chinese auto and battery majors such as GAC are playing catch up. 

Overseas expansion

Gotion management also defended the company’s strategic supply of the American market, saying tariffs on Chinese battery imports would have little impact on the company’s US business operations. 

The Chinese battery maker plans local battery production, geared towards energy storage (one of its major exports to the US), in 2026, said Chen Ruilin, vice president of international business. The Biden Administration has said it would increase the tariff rate for Chinese non-EV lithium-ion batteries from 7.5% to 25% in 2026. Gotion’s raw material factory in Michigan is set to begin operation by the end of this year, and it is aiming for volume production of battery cells at a $2 billion plant in Illinois by the middle of 2025, according to Chen. 

Gotion, headquartered in the eastern city of Hefei, has ambitiously proposed a plan to have 100 GWh of capacity in each of its major overseas markets, namely the Americas, Europe and Africa, and the Asia-Pacific region, by 2030. It already makes batteries in Thailand, as well as at one of its European factories. The Illinois plant is expected to begin production this year, according to the state governor’s office.

The first electric vehicle model of NIO’s lower-priced, family-oriented sub-brand Onvo finally made its debut in Shanghai on Wednesday, the International Day of Families, after three years of development. The coupe-style sports utility vehicle was surrounded at its unveiling by not only hundreds of journalists but also Chinese parents who took their children to the event, and who the company hopes will form the very first owners of the long-anticipated car.

The Chinese EV maker on Wednesday began taking reservations for the Onvo L60 at a pre-sale price tag of RMB 219,900 ($30,471), cheaper by RMB 30,000 than the entry-level Tesla Model Y but with a longer driving range and a roomier interior space, among other advantages. The SUV, scheduled for launch in September, is expected to be priced at under RMB 200,000, and come with NIO’s Battery-as-a-Service (BaaS) program, in which customers buy a car and pay for a battery rental service, similar to the company’s scheme for NIO branded cars.

Confident in the strong competitiveness of its offering and a large customer base in China, NIO management said it has “high expectations” for Onvo, which is short for “on voyage” in English. Its Chinese name Ledao translates as “path to happiness.” Speaking to reporters after the debut on Thursday, William Li, founder, chairman, and chief executive of NIO, shared additional details about NIO’s ongoing partnerships for battery swapping with some of China’s most established car manufacturers, including Geely, Changan, and GAC. 

First Onvo EV

NIO’s first mainstream crossover, with a similar shape to its more premium siblings, competes with Tesla’s Model Y, the world’s top-selling electric SUV, from nearly every perspective. The entry-level L60 comes with a driving range of 555 kilometers (345 miles), a bit longer than that of the rear-wheel-drive Model Y (554 km), while the other two variants travel more than 730 km and 1,000 km on a single charge, respectively. 

The company also said that the L60’s outstanding wind resistance, measured by a drag coefficient of 0.229, increases its effective range, while a 900-volt electrical system reduces energy loss to heat, giving it a longer range. The total energy consumption of the car is 12.1 kilowatt-hours (kWh) per 100 kilometers, compared with the 12.5 kWh achieved by the Model Y, according to NIO. 

Li said that NIO will make a “pretty decent” gross margin from the L60, by focusing on core values that matter to Chinese families, rather than producing a vehicle with a dazzling array of unnecessary specs, a move that keeps the car’s overall costs under control. Cost savings also come from NIO and Onvo sharing research and development costs, among other synergies.

The Onvo L60 embraces the vision-based approach advocated by Tesla, which uses cameras and artificial intelligence and gets rid of lidar sensors for autonomous driving. It also uses a smaller and more affordable lithium iron phosphate (LFP) battery pack from BYD, according to Reuters.

Battery swaps

NIO also provided details about its extensive power infrastructure network, which is claimed to be the largest of its kind in China with more than 2,415 battery swapping stations as of Wednesday. It has long been a loss-making effort for the company but is now emerging as an attractive option for charging availability and cost reduction for a growing list of Chinese auto giants. 

Onvo owners will only be able to use the company’s newer swap stations (the third- and fourth-generation ones) and will share the facilities with NIO’s partners. Each of the newer swap stations, which can hold more than 20 battery packs of different sizes, can offer more than 400 swaps per day, with each pack being used roughly up to 20 times. Li mentioned the company’s plan to charge partners a service fee of roughly RMB 20-30 per swap. NIO itself completed nearly 70,000 battery swaps per day as of May 8. 

Meanwhile, NIO owners can “refuel” their vehicles at any swap shop, giving them more charging availability and a premium user experience. The company said it is on track to build 1,000 battery swap facilities on its own this year and expand the network for NIO and Onvo from the 2,316 stations available as of the end of last year, while its partners are also set to provide additional resources. 

Li added that he envisaged there being six to seven EV battery sizes at most over the long term, with partners set to use batteries of the same kind as Onvo. NIO currently uses batteries in four sizes with an energy density ranging from 70 to 150 kWh.

READ MORE: Drive I/O | Big bets on battery swaps

TikTok owner ByteDance has surprised the artificial intelligence industry with the ultra-low cost of its Doubao model, which the company said is capable of processing 2 million Chinese characters, equivalent to 1.25 million tokens, for RMB 1 ($0.14). OpenAI’s most advanced multimodal model, GPT-4o, also unveiled this week, comes in at $5 per million input tokens handled.

“A good model works well and is affordable to everyone,” Tan Dai, president of Volcano Engine,  ByteDance’s cloud computing services unit, said at an event on Wednesday. “Large usage polishes a good model and dramatically reduces the unit cost of model inference,” he added.

Why it matters: The radical pricing, which Tan explained is achieved through model structuring and hybrid scheduling of cloud computing power, is likely to initiate a price war in China’s AI field after a battle on parameters.

Details: ByteDance’s Doubao large model family consists of nine versions, ranging from a “lite version” to the advanced Doubao Pro, which is able to deal with up to 128,000 token inputs. The range also includes models centered on generating pictures and virtual characters.

• The company did not disclose how many parameters it used to train its most powerful Doubao Pro model.
• The Doubao LLM family shares the same name as ByteDance’s ChatGPT alternative, a free AI bot that the company says has 26 million monthly active users.
• The Doubao model is now open to external developers and other interested parties for cooperation via Volcano Engine, though this comes months after tech rivals Alibaba and Tencent gave enterprise customers access to their models last April and September, respectively.

Context: Earlier this year, ByteDance founder Zhang Yiming criticized employees for not being “sensitive enough” to the emergence of new technologies like ChatGPT in an internal meeting, saying that discussions among staff over ChatGPT only started in 2023. His remarks came after the company had already launched the Doubao chatbot in the second half of last year.

On Tuesday, Chinese tech giant Tencent released its earnings report for the first quarter of 2024, which ended on March 31. Tencent’s revenue from the international gaming market increased by 3% year-on-year to RMB 13.6 billion ($1.88 billion) during the period, while revenue from the domestic gaming market decreased by 2% year-on-year to RMB 34.5 billion ($4.77 billion). Tencent attributed the domestic year-on-year decline to the impact of deferred revenue.

Why it matters: Over reliance on older hits such as Honor of Kings and Peacekeeper Elite may have led Tencent Games to stagnation, reduced player engagement, and increased its vulnerability to competitors launching new, innovative games. The lack of new hit titles from Tencent may risk diminishing the firm’s long-term growth and revenue potential in a rapidly evolving gaming market.

Details: Tencent’s gaming revenue totaled RMB 48.1 billion ($6.66 billion) in the first three months of 2024, marking a 17.6% increase quarter-on-quarter and a 0.41% decrease year-on-year. A yearly revenue drop but a quarterly rise may signal seasonal trends and indicate the company’s recent improvement in performance despite broader market challenges, including intensified industry competition, economic instability, and declining consumer demand.

• “During the first quarter of 2024, several of our leading games in China and internationally started to benefit from team reorganizations we put in place,” Tencent CEO Ma Huateng said in the financial report, “resulting in an increase in games’ gross receipts and creating a foundation for our games revenue to resume growth in future quarters.”
• In the first quarter, Honor of Kings and Peacekeeper Elite, two of Tencent’s flagship games, experienced a year-on-year decline in revenue. Tencent blamed this on a high base from the Chinese New Year period last year for the former, and weaker commercial content in the second half of 2023 for the latter. However, both games saw a year-on-year revenue increase in March.
• During the quarter, several domestic games achieved their highest-ever gross totals, with titles such as Fight of the Golden Spatula, CrossFire Mobile, and Arena Breakout leading the way, according to the company. Recently released overseas games, including VALORANT and Lost Ark, both exhibited robust growth, the firm said.
• Supercell, a Finnish game development company that Tencent acquired in June 2016, experienced growth in both usage and gross receipts in the overseas gaming market during the reporting period. The multiplayer online battle arena shooter game Brawl Stars’ daily active users more than doubled compared to the previous year, while gross receipts more than quadrupled year-on-year internationally for the title.

Context: In the first quarter, Tencent’s total revenue reached RMB 159.5 billion ($22.08 billion), reflecting a 6% year-on-year increase, while adjusted net profit amounted to RMB 50.27 billion ($6.96 billion), showing a notable 54% year-on-year growth.

• In the first quarter of 2023, Tencent’s revenue from games reached RMB 48.3 billion ($6.9 billion), up 11% up year-on-year. Tencent’s domestic gaming revenue during the period rose 6% year-on-year to RMB 35.1 billion ($5 billion), while its overseas gaming revenue rose 25% to RMB 13.2 billion ($1.8 billion).

Chinese electric vehicle giant BYD will finally roll out its first electric pickup truck, named the Shark, in Mexico on Tuesday, marking its entry into the growing segment and firing the starting gun on a new race with established rivals from Ford to Tesla on the global stage.

The Shark is set to be a high-end offering and is the latest model in the company’s expanding Ocean family of EVs, which target younger and tech-savvy consumers compared with its Dynasty family. It also shares the company’s latest EV platform with the Bao 5, a luxury off-road sports utility vehicle under its Formula Leopard marque, or Fangchengbao in Chinese pinyin. Holding a dominant position in the home market, BYD is ramping up efforts to pursue global opportunities, and the launch of the Shark will be the latest attempt by a Chinese automaker to push upmarket and create a global brand.

With the BYD Shark framed by some as a serious threat to the Ford F-150 Lightning, below are some of the most important details about the pickup ahead of its official launch at 10:30 a.m. (UTC -6) today.

#1 The Shark will share the latest DMO (dual-mode off-road) plug-in hybrid EV platform with the dual-motor Bao 5 SUV, which uses a 1.5/2.0-liter high-performance petrol engine and delivers a combined output of more than 500 kW. BYD will also likely use high-quality materials and modern equipment in the truck to provide a high-spec cabin similar to that of its sibling, featuring the likes of advanced LED displays for infotainment and a large-sized head-up display unit to provide real-time information to drivers. 

#2 It also seems inevitable that a range of BYD’s in-house technologies will be incorporated into this strategically important model, including “blade batteries,” which boast improved thermal stability and strong resistance to collisions, as well as the DiSus, an electric-powered body control suspension system. In addition to featuring an adjustable suspension system powered by artificial intelligence algorithms, the Shark will also be able to power other vehicles as well as electronic devices with its bidirectional charging capability, which could be a useful and attractive function for camping expeditions. 

#3 Both PHEV and all-electric Sharks are expected to be available to global consumers, in line with BYD’s other international offerings. The PHEV will likely have a driving range of 1,200 kilometers (746 miles) on a full charge and full tank of gas and could be charged from 30% to 80% in just a few minutes, if the performance of the Bao 5 is repeated for the pickup, as seems likely. It may also provide low energy consumption similar to the Bao 5 which reports an impressive fuel consumption of 7.8L/100 km.

#4 The BYD Shark will probably focus on the overseas markets for the foreseeable future, as there have been restrictions on commercial vehicles including pickups in China. Some local governments have prohibited pickup trucks from being driven in their downtown areas, including Beijing, Hangzhou, and Chengdu. Nevertheless, the new model will be produced at BYD’s Chinese plants, at least for now. The company is looking for a location in Mexico to build a factory, BYD Americas chief executive Stella Li told Reuters early this year.

#5 BYD’s first pickup truck will compete against the Ford F-150 Lightning, the Tesla Cybertruck, as well as the Great Wall P series, at an expected price tag of around RMB 300,000 ($41,460). Rival Great Wall Motor was the top-selling brand of pickup truck in China in 2023, posting sales of 143,851 units globally and accounting for roughly half of the domestic market in the category last year. Ford reported a 6.8% growth in the US in the first quarter of 2024, thanks to strong demand for its pickup trucks.

Fast fashion retailer Shein is refueling its IPO ambitions by pivoting to a London listing, as its US listing remains in limbo, according to a Reuters report which cited two sources. However, the China-connected company, which moved its headquarters to Singapore in 2022, is said to still prefer a public debut in New York.

Why it matters: The choice of London as a listing venue is being seen as the second best option for Shein, whose potential US IPO continues to be viewed as a bellwether for the geopolitical state of play between the US and China.

Details: Shein reportedly said it would update China’s securities regulator over any change in its listing aim, and file with the London Stock Exchange as soon as this month, according to Reuters.

• Political headwinds Shein faces in the US, its largest market by revenue, show no sign of diminishing. Republican Senator Marco Rubio in April asked Secretary of Homeland Security Alejandro Mayorkas to investigate Shein and Temu on claims that ultra-low prices on the two platforms are a result of “a combination of” intellectual property theft, trade exploitation, strong backing from the Chinese government, and alleged use of forced labor. 
• The push follows a February letter in which the senator urged the SEC to block Shein’s IPO unless the company disclosed more details on “business practices and risks to their business.”
• In 2023, Shein emerged as the third-biggest online fashion retailer by net sales in America, after Amazon and Walmart, data conducted by ECDB and Statista showed.
• A source quoted by Reuters said that China’s securities regulator told Shein early this year it would not recommend a US listing due to supply chain issues. Shein’s rise globally is largely thanks to its huge pool of China-based suppliers that lower costs and enable a fast turnaround on new item production.

Context: Last year, despite stronger scrutiny of its business operations, Shein recorded over $2 billion in profits – a figure that had more than doubled from the previous year. The company sold a total of approximately $45 billion worth of merchandise globally during the period, according to a Financial Times report.

• As part of Chinese regulations issued in February 2023, China-based companies, including those incorporated offshore, are required to go through an official review process if they seek to list overseas.

Shanghai-based chip foundry Semiconductor Manufacturing International Corporation (SMIC) on Thursday unveiled its first quarter financial results, revealing that the state-owned company achieved a revenue of $1.75 billion, representing a 19.7% year-on-year increase. This result marks the first time that SMIC surpassed both United Microelectronics Corporation (UMC) and GlobalFoundries in quarterly revenue, with the two Taiwan-based firms reporting revenues of $1.71 billion and $1.549 billion respectively for the same period.

The ranking does not include IDM (Integrated Device Manufacturer) companies such as Intel and Samsung.

Why it matters: Amid US sanctions on Chinese chip development, SMIC’s growth signals China’s efforts to strengthen its domestic semiconductor capabilities and reduce reliance on foreign suppliers.

Details: Its first quarter financial results place SMIC second among the world’s wafer foundries, albeit with a considerable gap to TSMC, which reported a revenue of $18.262 billion for the same period.

• In the first quarter, SMIC shipped 1.79 million units of 8-inch wafers, a 7% increase compared to the previous quarter. The company’s capacity utilization rate reached 80.8%, up by 4% quarter-on-quarter.
• Revenue distribution across chip-related business segments is as follows: smartphones account for 31.2%, computers and tablets for 17.5%, consumer electronics for 30.9%, IoT (Internet of Things) and wearables for 13.2%, and industrial and automotive for 7.2%. 
• Revenue from China makes up 81.6% of the firm’s total, while the US contributes 14.9%, and the EMEA (Europe, Middle East, and Africa) region accounts for 3.5%.
• However, SMIC’s net profit for the quarter plummeted by 68.9% compared to the previous year, to $71.8 million. The semiconductor industry as a whole witnessed a substantial decline in profits in early 2024 due to product price drops and inventory backlog, according to local media outlet Jiemian. SMIC told Jiemian that this net profit decline was primarily due to shifts in product assortment, depreciation, and diminished investment returns.
• SMIC CEO Zhao Haijun disclosed that the company received urgent orders from customers in the smartphone and computer sectors in the first quarter, the same Jiemian report said. Efforts are underway to coordinate orders from lower-priority customers for delayed processing, and the 12nm chip production line is almost at full capacity, Zhao said.

Context: Thanks to the AI-related needs of Nvidia and AMD, orders of TSMC’s advanced packaging capacity, including Chip-on-Wafer-on-Substrate (CoWoS) and System-on-Integrated-Chip (SoIC), have been fully booked for 2024 and 2025, according to an Economic Daily News report from last week. TSMC predicts a compound annual growth rate of 50% for AI chips over the next five years. By 2028, AI chip orders are expected to contribute over 20% to the company’s total revenue.

Baidu’s PR head, Qu Jing, has left the search engine giant after her controversial remarks on work culture exploded on Chinese social media. The surfacing of a series of videos made by Qu has led to the public casting doubt on the company’s corporate values.

“I’m not even obligated to find out if you cried or had a quarrel [with your boyfriend or husband], which does not serve my concern as a supervisor. I’m not your mother-in-law, also not your mum,” Qu commented in one of a series of short videos posted on Douyin, China’s TikTok sibling. 

All four of Qu’s controversial videos on the platform have since been deleted, but clips can still be found on Chinese social platforms and her comments have sparked a firestorm of attention and debate. 

Why it matters: The incident has escalated into Baidu’s biggest PR crisis in years. The company, which is facing a declining search engine share and is seeking an AI-centric transformation, has looked to calm public outrage in the wake of Qu’s comments.

Details: News of Qu Jing’s departure was reported on Thursday night, just hours after she apologized in a post on WeChat Moments from her personal account.

• That apology letter did not mention Qu’s impending exit from the company, but saw her clarify that the videos “do not represent Baidu’s stance.” It stated that Qu did not obtain consent from the company before making the videos public.
• Qu Jing became the vice president and chief of communications at Baidu in 2021, after leading public and government affairs at Huawei and her previous work as a reporter for China’s state-backed Xinhua news agency, according to her  Wikipedia page. 
• In one video, Qu criticized a Baidu employee who refused to take a 50-day business trip during the height of the Covid-19 pandemic, when China imposed strict travel restrictions across the country. “How dare you tell me that your husband can’t stand it and needs you back [home]? I’m 10 or 20 years older than you and have two kids, [but] I feel neither bitter nor tired,” she said.
• Another video that went viral late Wednesday added fuel to the fire of public opinion, and bringing into question Qu’s ability as a PR chief. In the short video, Qu was recorded smacking a small paper figure with the letters SCMP written on it, widely regarded as referring to the South China Morning Post. The incident is suspected to be Qu venting her anger over a January report published by the newspaper linking Baidu’s ChatGPT rival ERNIE Bot with China’s military. However, TechNode has not been able to independently verify when the video was taken.

Context: Baidu, along with other major tech companies in China, has faced repeated scrutiny and criticism over its so-called wolf work culture in recent years. In one of the most notable examples, in 2019, Alibaba founder Jack Ma came under fire after he referred to the practice of “996”, working from 9 a.m. to 9 p.m. six days a week, as a “huge blessing”.

An increasing number of automakers are looking to make their vehicles compatible with the battery swapping standard NIO is pushing for in China, as GAC Group said on Wednesday it will partner with NIO to expand swapping infrastructure for electric vehicles across the country. 

Why it matters: The collaboration highlights increasing efforts by carmakers, along with various stakeholders such as battery suppliers and energy firms, to tackle the issue of range anxiety – fear of an EV running out of power – which has hindered greater EV adoption. The move is also expected to allow NIO to cut expenses further as it opens the money-losing power network to other automakers. 

• GAC and NIO have a collaborative history that dates back several years. They set up a joint venture for EV manufacturing in April 2018 with a registered capital of RMB 2.5 billion ($350 million), although the following few years brought lackluster sales results for their joint brand Hycan. NIO completely retreated from the JV in the summer of 2022.

Details: According to a Wednesday release, the two automakers plan to develop a standardized battery module that would facilitate the roll-out of swap station-compatible passenger EVs from both sides. 

• They also expect to establish scale advantage by creating an extensive, unified power infrastructure network, as well as capture more value from repurposing used EV batteries throughout their lifespans. 
• Although a detailed timeline has not yet been released, owners of both brands’ vehicles will be able to use their own apps to access and pay for charging at a fast charger from either company by the end of this month. 
• ”With this as a starting point, we hope to build more battery swap stations with which our GAC Aion users will have a better swapping experience,” said Feng Xingya, president of GAC Group. 

Context: Guangzhou-headquartered GAC is the latest Chinese automaker to announce that its EV owners will have access to NIO’s nationwide infrastructure network, following deals with Changan, Geely, JAC, and Chery, as well as the company’s link-ups with state-owned utilities Wenergy Group and China’s Southern Power Grid. 

• State-owned manufacturer GAC, a manufacturing partner of Toyota and Honda in China, said it operated a network of roughly 1,000 battery refueling facilities nationwide as of December, of which dozens were swap stations. It has sold an undisclosed amount of Hyper-branded EVs with swappable batteries. 
• NIO operates 2,413 battery swap facilities as of Wednesday, already the country’s biggest network of its kind, and 3,828 charging outlets mostly for non-NIO cars. The company’s upcoming brand Onvo, with plans for an official debut on May 15, will share its latest-gen battery swap stations with those partners. 
• Battery heavyweight CATL and ride-hailer Didi are also jointly building battery swap stations in a move to answer Beijing’s call to further increase EV penetration, especially in lower-tier Chinese cities and the country’s rural areas. International carmakers are reportedly embracing Tesla’s EV charging system or forging their own alliances meanwhile.

READ MORE:  Drive I/O | Big bets on battery swap

On Tuesday, MediaTek held the MediaTek Dimensity Developer Conference (MDDC) 2024 in Shenzhen, where the Taiwan-based semiconductor company unveiled its latest flagship 5G chipset, the Dimensity 9300+. With a theme of “AI Empowers Everything,” MDDC 2024 delved into the applications and advances in artificial intelligence technology across various domains, and the possibilities it brings to terminal devices.

Why it matters: MediaTek introduced the Dimensity 9300+ less than two months after the launch of Qualcomm’s Snapdragon 8s Gen 3. Amid slow growth in the smartphone industry, MediaTek is aggressively competing for Qualcomm’s market share of mobile chipsets. 

Details: The Dimensity 9300+ chipset and generative AI were the main highlights at MDDC 2024.

• The Dimensity 9300+ has adopted TSMC’s third-generation 4nm process technology, according to MediaTek. The new chip boasts big-core CPU architecture, housing an octa-core CPU comprising four Cortex-X4 ultra-large cores clocked at up to 3.4 GHz, and four Cortex-A720 large cores operating at 2.0 GHz.
• MediaTek claims that the full big-core CPU ensures low power consumption across varying application loads and enables smartphones to deliver sustained high performance over extended periods by combining high speed with energy efficiency.
• The Dimensity 9300+ supports on-device LoRA (Low-Rank Adaptation) Fusion and NeuroPilot LoRA Fusion 2.0 technology that allows developers to quickly introduce new generative AI applications with text, voice, imagery, and music, the company said. This translates to smartphones equipped with the Dimensity 9300+ chip offering enhanced AI functionalities.
• The flagship processor integrates a 2nd-gen hardware ray-tracing engine with an Arm Immortalis-G720 GPU, delivering 60 frames per second (FPS) ray-tracing and console-grade global illumination effects for gamers, according to the official website. MediaTek HyperEngine technologies further enhance the gaming experience, according to the company, with MediaTek Adaptive Gaming Technology optimizing power efficiency for longer battery life. Furthermore, HyperEngine’s Network Observation System improves dual-network concurrency and offers up to 10% power savings and 25% cellular data savings.
• During the event, MediaTek unveiled the Dimensity AI Pioneer Program for global developers, collaborating with industry partners such as Alibaba Cloud, Baichuan Intelligence, Transsion, Oppo, Honor, Vivo, and Xiaomi. The program aims to offer resources, technical support, and business opportunities for global developers to create innovative generative AI experiences on Dimensity-powered devices.
• At the same time, MediaTek partnered with Alibaba Cloud, Baichuan Intelligence, Huya, Kugou Music, Oppo, Tencent AI Lab, and Vivo to jointly release a Generative AI Smartphone Industry White Paper. The white paper defines Generative AI smartphones as devices utilizing large-scale, pre-trained generative AI models to achieve multi-modal generation, context awareness, and evolving human-like capabilities.
• The white paper signals a strong integration trend in generative AI for smartphones and explores the AI strategies of various chip manufacturers, phone makers, large model developers, and developers in the generative AI ecosystem. Industry analysis firm Counterpoint forecasts rapid growth for generative AI phones in the coming years, with a global user base of around one billion expected by 2027.

Context: In the fourth quarter of 2023, MediaTek maintained its lead with a 36% share of the global smartphone chipset market, followed by Qualcomm at 23% and Apple at 20%, according to data provided by Counterpoint‘s Global Smartphone AP-SoC Shipments & Forecast Tracker by Model.

• On March 18, California-based chip firm Qualcomm launched the Snapdragon 8s Gen 3, the company’s latest flagship chipset, equipped with several on-device AI capabilities. The new 4nm chipset arrives as a more affordable version of the top-of-the-line Snapdragon 8 Gen 3 chip launched last October.

Alibaba’s marketplace Taobao has dropped its presale period for the upcoming 618 shopping festival, a promotional mechanism that it had been using for a decade to stimulate sales. Previously under the strategy, consumers were required to pay a deposit in advance, and then pay the final amount within a specified date range, but would not receive the goods until after the latter had cleared, leading to longer delivery times than usual. 

Why it matters: Alibaba is expected to focus on optimizing user experience during the mid-year shopping bonanza in an effort to offer more straightforward shopping steps akin to rival Pinduoduo. 

Details: According to local media outlet LatePost, Alibaba CEO Eddie Wu finally made the decision to cancel presale promotions after employees “overwhelmingly supported” the proposal in internal debates.

• The report added that presale deals would still appear in e-commerce livestreams, a major channel for presale items, mostly in the makeup category.
• The presale mechanism was seen as limiting for shoppers who wanted goods to be delivered immediately after placing their orders, a situation that has emerged as one of the sources of dissatisfaction during China’s largest shopping festivals. Taobao and Tmall have announced that they will kick off the country’s second-largest festival on May 20 this year, offering discounts for almost a month until June 18, or 618.
• Alibaba has also recently sharpened its focus on optimizing Taobao’s web-based platform, LatePost reported, after website version had been played down for years due to the popularity of mobile phones. Compared to the comprehensive shopping experience on mobiles and especially in app, Taboo’s website offers fewer features and consistently directed shoppers to download the app instead.
• “The only thing we’re doing at the moment is trying desperately to make up for some of the experiences we’ve lost in recent years,” said Zhao Kun, head of Taobao’s website, on Alibaba’s internal forum according to LatePost. The media outlet quoted his post as saying the team has launched more than 60 new features in less than two months. 

Context: The changes are in line with Alibaba’s newly revived “user first” approach, one of the two key strategic areas emphasized by Eddie Wu, who currently also holds the chief executive position at the tech giant’s domestic e-commerce group and its cloud computing unit.

Sales of Chinese electric vehicle makers Li Auto and Huawei-backed Aito dropped sharply in April as rivals Zeekr and NIO managed to post major improvements, in the latest indication of how competition in the country could be impacted by price cuts and new model launches. 

Why it matters: The latest sales figures in April showed the world’s largest EV market is slowly recovering from a sales slump due to an economic downturn and inclement weather early this year. Some potential EV buyers are still waiting on the sidelines for possible stimulus measures and for new cars shown at this year’s Beijing Auto Show to make it to market, experts say. 

READ MORE: Global carmakers take on Chinese giants in EV showdown at Beijing Auto Show 2024

Details: GAC’s Aion, Li Auto, and Huawei-backed Aito – which are among the biggest Chinese EV makers – all reported double-digit declines in EV deliveries in April from a month earlier. Huawei saw sales of Aito-branded EVs fall 21% last month, with monthly deliveries of the redesigned M7 falling to 10,896 units from its peak of nearly 30,000 units. Aion and Li Auto delivered 28,113 and 25,787 EVs in April, 13.6% and 11% fewer than a month earlier, respectively. 

• All three EV makers have launched new cars and ushered in steep price cuts for their existing models in order to maintain demand throughout 2024. Huawei said on Monday it had secured 11,000 reservations with non-refundable deposits for the Aito and Luxeed lineups over the recent five-day Labor Day holiday, while there were more than 41,000 pre-orders for Li Auto’s L6 range-extended hybrids between April 18 and May 5. GAC is currently putting the redesigned versions of its Aion V and Hyper HT battery crossovers on display in its showrooms nationwide. 
• In the meantime, Zeekr achieved record deliveries of 16,089 vehicles in April, up 24% month-on-month and 99% from a year earlier, mostly driven by a strong performance for its revamped 001 shooting brakes. NIO also saw sales hitting 15,620 vehicles, up from 11,866 a month earlier, as the company’s multiple sales pushes started to pay off. The EV startup has been offering a RMB 10,000 ($1,386) price reduction for those who trade in their old, gas-powered vehicles for a NIO car since the beginning of April. 
• While bringing attention to its rivals such as Zeekr and NIO for their similar offerings, Xiaomi posted impressive April sales to officially start its career as an electric car maker. The smartphone giant handed over 7,058 SU7 battery sedans to customers in its first delivery month and secured nearly 89,000 reservations with non-refundable deposits as of April 30. Chief executive Lei Jun expects the company to achieve an annual delivery target of 100,000 cars this year, with its production ramp-up already underway at its Beijing factory. 
• Xpeng Motors saw a slight recovery in April sales, delivering nearly 2,000 units of its first multi-purpose vehicle and bringing the total deliveries of the RMB 359,800 van to almost 10,000 units in the four months since its launch. The Volkswagen-backed EV maker has been under pressure from larger rivals, and declined to give detailed figures for the rest of its models. Sales of its G9, G6, and P7 models dipped to less than 1,700 units in March, figures compiled by Chinese auto service platform Dongchedi showed.

Context: China’s new energy vehicle sales in April are expected to be on par with March at roughly 720,000 units, partly because wait-and-see sentiment has grown among Chinese customers, the China Passenger Car Association said in an April 25 post.

READ MORE: ​ Explainer: How a new round of price cuts are reshaping China’s EV market ​

Tesla claimed on its Chinese app on Monday that it would be rolling out its full self-driving (FSD) system “very soon” rather than the previously stated “a bit later” (our translation). The development comes as the US automaker reportedly received tentative approval from Chinese authorities to deploy its advanced driver assistance systems (ADAS) in the world’s most competitive electric vehicle market following a surprise visit to Beijing by chief executive Elon Musk. 

Local customers have expressed mixed views about the potentially game-changing technology finally coming to their country, although many Tesla owners and loyal fans welcomed the long-overdue launch on social media. The technology may not yet work well in Chinese urban driving scenarios, despite costing RMB 64,000 ($8,838); most competitors such as Xiaomi promise to offer similar functions free of charge, Li Yang, a Model 3 owner in Shanghai, told TechNode on Tuesday.

Major Chinese EV players Huawei and Xpeng Motors, who specialize in autonomous driving, have responded in a relaxed way to what is seen by many as a major win for their US rival. 

“We are confident that Huawei’s intelligent driving system is the best in the world,” Richard Yu, Chief Executive of Huawei’s Consumer Business Group, said at a press event last week as the company introduced the redesigned Aito M5 crossover. Aware of Tesla’s release last month of the no-longer-in-beta FSD software, Yu said the company has closely studied its competitor’s technology by taking test rides in San Francisco, among other US cities. 

A long-awaited battle: Experts told TechNode that the US and China have been in a neck-and-neck race to develop “end-to-end neural network” technology, seen by experts as the biggest difference between Tesla’s FSD v12 software and earlier versions.

• Tesla chief executive Elon Musk stated publicly in November that its most updated, end-to-end FSD uses machine learning rather than rules crafted by programmers to absorb driving behaviors from large datasets. The approach reduces the carmaker’s reliance on coding, expensive sensors, and high-precision maps for exact road information.
• “It is more of a 1,000 flowers blooming type of situation here in China, while the US market is guarded by a sole player,” Paul Gong, head of China autos research at UBS, told reporters on Monday in Beijing, referencing a Chinese idiom. Both the US and China are at the forefront of the technological trend, followed by Europe and the rest of Asia, Gong added.
• Although Tesla has huge amounts of data, Chinese firms have the potential to quickly catch up by ramping up their test fleets, according to Song Chaozhong, CEO of Chinese self-driving car startup eCHIEV. Song cautioned that real, “human-like” autonomous cars are still far away, despite the technology likely being a positive driver for vehicle sales. 

A booming segment: Analysts expect Tesla’s imminent launch of the FSD software in China to not only help restore Beijing’s image among foreign investors in general, but also help China extend its lead in the adoption of driver-assist technologies worldwide, and enhance its reputation as a rising powerhouse of next generation cars. 

• China has become a source of innovative engineering for global automakers, as they are now leveraging the capabilities of Chinese companies to design global vehicle offerings, Gong said when asked his view of this year’s Beijing Auto Show. He added China’s push to open its industries to greater foreign investment and competition has been “underestimated.”
• Tech-literate Chinese EV makers are poised for explosive growth thanks to growing interest from Chinese consumers in intelligent driving features, as Elon Musk earlier predicted a “ChatGPT moment” was coming for his company. Huawei on April 24 estimated that more than 500,000 cars on Chinese roads will feature its advanced driving system by year-end. 
• Xpeng is scheduled to launch its affordable brand MONA in June with the first model expected to feature an autonomous driving system without the integration of lidar and aiming for annual sales of 100,000 units. Global shipments of vehicles with ADAS features, known as Level 2 plus autonomy, could more than double to 4.5 million units this year, with China leading the game, research firm Canalys wrote in December.

Context: Tesla’s China breakthrough comes after US Secretary of State Anthony Blinken on April 25 called on China to provide a level playing field for American businesses during his second visit to China in less than a year, Reuters reported. 

• The US automaker has reached a deal with Baidu to localize its driver assistance solution with map and geographical information from the Chinese tech giant, according to Bloomberg.

Chinese battery manufacturer and technology company Contemporary Amperex Technology Co. Limited (CATL) revealed on Monday that it is committed to the research and mass production of solid-state batteries, with the aim of achieving small-scale production by 2027, according to local media outlet Jiemian. However, overcoming challenges related to cost is essential for realizing large-scale production, the company said.

Why it matters: Presenting a promising solution to conventional lithium-ion battery limitations, producers maintain that solid-state batteries offer enhanced safety, higher energy density, improved performance, increased durability, and reduced environmental impact. They have the potential to transform various industries, including electric vehicles, portable electronics, and renewable energy systems.

Details: The company’s current level of research on solid-state batteries stands at 4, on a scale of 1-9 for technical and manufacturing maturity, CATL’s chief scientist Wu Kai disclosed at a battery technology seminar. CATL plans to achieve a rating of 7-8 by 2027, the year the company plans to be able to produce solid-state batteries on a small scale, Wu told Jiemian.

• Compared to liquid lithium batteries, solid-state batteries demonstrate better performance in terms of energy density. Currently, liquid lithium batteries can reach 350 watt-hours per kilogram, while solid-state batteries are expected to achieve up to 500 watt-hours per kilogram, according to the chief scientist.
• The technological pathways for solid-state batteries primarily include polymers, oxides, and sulfides. Wu claimed that CATL is currently investing more in research and development of the sulfide option, likely to be the first in mass production.
• Sulfide electrolytes exhibit high conductivity and good process ability, but they are also prone to generate toxic gasses when exposed to water and involve high costs due to complex production processes, Wu further explained.
• Wu stated that CATL is striving towards the goal of solid-state batteries representing 1% of the global battery market share. Tech challenges remaining include solid-solid interfaces, lithium metal anodes, solid-state electrolytes, and other manufacturing processes, the scientist added.

Context: Last September, Japanese automaker Toyota announced a development plan for solid-state batteries. Toyota plans to bring electric vehicles equipped with solid-state batteries to market as early as 2027, enabling them to drive around 1,200 kilometers on a charge of under 10 minutes.

China’s food delivery giant Meituan is hiring Arabic- and English-proficient talent for its likely entry into Riyadh, the capital of Saudi Arabia, as the company puts expansion beyond China on its agenda as domestic consumption falls. 

Meituan is set to launch KeeTa, the food delivery brand which it launched in Hong Kong last year, in its first Middle East destination in the coming months, Bloomberg reported on Friday. 

Why it matters: Meituan’s first expansion outside of China comes at a time when a string of Chinese companies have turned to overseas expansion amid uncertainty about the prospects of recreating the high growth situation that the tech sector has enjoyed at home for much of the past two decades. 

• “I think it may take us another 10 years to make a significant impact in overseas markets, and we are not in a hurry to do that,” said chief executive Wang Xing last month. “We will be evaluating very carefully the opportunities for that and the ways to get into the market,” he added.

Details: CEO Wang took direct control of the Beijing-based company’s global business in a February overhaul. He told investors on a fourth-quarter earnings call that Meituan is “very actively evaluating opportunities in other markets” after its Hong Kong entry saw “positive results.”

• Meituan executives, including Wang and Head of Strategic Overseas Investments Zhu Wenqian, visited Saudi Arabia for meetings with local government ministers and members of the Saudi royal family last May, according to a report by Chinese tech media outlet 36Kr, when they tried to assess whether the country was suitable for a food delivery pilot scheme.
• Meituan expects to compete directly with well-established platforms such as Delivery Hero, Deliveroo, and Jahez in the Middle Eastern country, where the online food delivery market is projected to grow at 5.62% annually, data from Statista shows.
• High subsidies from the company in order to provide customers with discounts have played a key role in Meituan’s initial success in Hong Kong under KeeTa since it landed in the region in May 2023. Last year, the platform captured a 21% market share by GMV in the territory, rapidly eating into rivals’ shares. 

Context: After recording its lowest stock price in a year in February, at slightly over HK$60, Meituan’s shares are slowly recovering. The company’s stock price is still just a quarter of its value at its peak in mid-2021 however.

Global carmakers from Volkswagen to Toyota are introducing new models at the Beijing Auto Show 2024 with the help of Chinese tech companies in an effort to defend market share amid a major shift to electric vehicles led by local car giants. 

The biannual trade event, which on Thursday witnessed a return to pre-pandemic attendance levels after a brief pause in 2022, also represents another landmark moment for the Chinese EV sector where domestic players are once again on the offensive with an array of new models. A similar event in Shanghai a year ago reportedly prompted the industry’s legacy players to either increase their efforts or rethink their brands in order to adapt to the changes.

Below, TechNode provides a summary of some of the biggest releases from both international and Chinese automakers, including BYD, GAC, Geely, Honda, Toyota, and Volkswagen. There are also some notable updates from younger players such as Xiaomi, NIO, and Xpeng, which might give a clue as to where the most competitive EV market in the world is heading. 

BYD

China’s biggest EV maker on Thursday unveiled a higher-end variant of its Qin vehicle, the top-selling compact sedan in the country last year. The new car is scheduled for launch in the second quarter with an expected price tag of RMB 120,000 ($16,560). The Qin L measures 4.8 meters in length and spans a 2,790-millimeter-long wheelbase, placing it between the Qin Plus and the Han in terms of size. It features the company’s next-generation plug-in hybrid platform DM-i 5.0, which could suggest an improvement in range and fuel efficiency. The company also introduced the Seal 06, a plug-in hybrid EV under the Ocean lineup which is about the same size as the Qin L but loaded with more stylish design language to attract younger customers. 

GAC

Aion, the third best-selling EV brand in China last year after BYD and Tesla, showcased its first global model, replete with modern technologies and angular styling, as its state-owned parent beefs up its strategy to woo customers worldwide. GAC said its all-new Aion V, scheduled for launch in July, will maintain a driving range of over 750 kilometers (466 miles) even when the mercury dips to -30 degrees Celsius, and offers a large interior space comparable to the likes of the BMW X5. The all-electric sports utility vehicle, which incorporates traditional Chinese dragons into its design, can navigate varied urban environments worldwide with features such as lane switching by utilizing advanced artificial intelligence algorithms to process sensor data instead of high-precision maps, the company said.

Geely

Volvo’s parent showed its ambition to become a disruptive force in the global automotive industry with the debut of what it described as the world’s first production model with two sliding doors and front swivel seats. Geely has taken a radical approach to how EVs are put together, giving the 4.7 meter-long Zeekr Mix an extended wheelbase of three meters achieved through a more compact electric motor, shorter front overhangs, and repositioning of the air conditioning system, among other components. This, along with the front seats that can rotate 270 degrees, would allow kids to play or families to dine together in a 1.5 square meter interior flat space. The five-seater multi-purpose vehicle, offering a 1.5 meter width opening area for passengers, targets three-generation Chinese families, especially those with elders and pregnant mothers.

Honda

Japan’s Honda on Thursday began selling its second all-electric model with time-limited discounts in China in the company’s latest effort to boost sales. The move comes after entrenched rivals such as BYD and Tesla recently rolled out more price cuts amid slowing growth. The e:NP2 SUV has a driving range of 545 km at a price tag of RMB 159,800, providing buyers with a RMB 30,000 reduction compared to its original plan, according to Li Jin, a deputy general manager of Honda’s China joint venture with GAC. Honda also debuted the Ye, a new series of all-electrics with technologies sourced from Huawei and iFlyTek among other Chinese tech firms, as part of its plan to sell only EVs in China by 2035.

Toyota

Toyota said on Thursday it will integrate lidar sensors into its two upcoming models under the “Beyond Zero” (bZ) all-electric series, as the world’s top-selling automaker looks to provide consumers with the same level of assisted driving technology as Huawei and Xiaomi. The bZ3x and the bZ3c compact crossovers will be able to automatically change lanes, and enter and exit Chinese highways when they go on sale within the next 12 months. Toyota also announced it is exploring the uses of generative AI in collaboration with Tencent, as Chinese consumers expect their future vehicles to be more capable and personalized. This follows reports that the Japanese giant is using Huawei components to enable autonomous driving functions on its China-made EVs. 

Volkswagen 

Germany’s biggest carmaker participated in Auto Beijing 2024 with major global debuts including the ID.Code concept – which offers a glimpse into its upcoming, China-specific all-electric lineup ID.UX – as well as the Audi Q6L e-tron, the first production model based on its PPE electric platform. The coupe-styled ID.Code will be equipped for highly autonomous driving and come with a sophisticated AI assistant with contributions from local designers, as Volkswagen plans to introduce the first model under the new series later this year. In addition to partnerships with Xpeng and Horizon Robotics, the automaker confirmed it is working with Chinese tech giants including DJI, as its latest Tiguan L SUV now features an advanced driver assistance system (ADAS) sourced from the drone maker.  

Xiaomi, NIO, and Xpeng

Xiaomi was the center of attention on Thursday when the Chinese smartphone giant said it had secured 75,723 reservations with non-refundable deposits for the SU7, its first EV, with a competitive price range between RMB 215,900 and RMB 299,900. Chief executive Lei Jun expects monthly delivery to exceed 10,000 units in June and the company is set to reach a milestone with 100,000 EV deliveries by this year, which would be a record speed for any Chinese EV brand. The 55-year-old entrepreneur is an icon in the Chinese tech and auto industries, with his visits to rivals’ booths becoming one of the hottest topics at this year’s Beijing Auto show.

Xpeng Motors could take on its major frenemy with the mainstream brand MONA, short for ‘Made of New AI,’ CEO He Xiaopeng told reporters during a press conference. 

Meanwhile, one of NIO‘s new affordable brands, called ONVO, is scheduled for launch in the second quarter of this year. The luxury EV maker on Thursday launched a redesigned version of its ET7 sedan with a starting price of RMB 428,000, which is RMB 20,000 lower than its original version launched three years ago.

READ MORE: Huawei, Xiaomi, and Geely’s new EVs have details leaked on Chinese government site

TikTok CEO Shou Zi Chew told the platform’s users that “we aren’t going anywhere” after US President Joe Biden signed the sell-or-ban bill targeting the app into law, giving TikTok’s Chinese parent company nine to 12 months to divest.

“The facts and the Constitution are on our side and we expect to prevail again,” Chew said in a video on Wednesday.

Why it matters: The passing of the bill after months of threats is a clear wake-up call for other Chinese apps that see the US as a top destination for their business expansion or have already entered the market there.

Details: The countdown to the forced sale of TikTok began when Biden signed the bill on April 24, but the short video app’s 170 million American users will continue to have access to it during this period. TikTok is expected to robustly challenge the move in the US courts.

• The law comes as US Secretary of State Antony Blinken begins his visit to China, where he expects to meet the country’s foreign minister Wang Yi.
• Former editor-in-chief of Chinese media outlet Global Times, Hu Xijin, who is known for his nationalist stance, wrote on X that TikTok should “fight to the end”, hours after the Senate ruled on the platform on Wednesday. He said he believes it will be “meaningless” if ByteDance founder Zhang Yiming “loses this career and only gets some money.”
• On Wednesday, China’s Ministry of Foreign Affairs commented it had nothing more to add to the country’s stance on the TikTok ban as the government institution said it has already made clear its position that there would be “no fairness to speak of” if the US uses national security reasons to ban foreign companies.

Context: TikTok, along with its Chinese owner ByteDance, spent over $7 million on in-house lobbyists and digital ad campaigns this year in an effort to avert the bill passing, according to lobbying disclosure reports cited by CNBC.

Chinese universities and research institutions were still able to purchase servers equipped with the restricted GPU (Graphics Processing Unit) chips as of Feb. 28, despite US export restrictions on the chips being in place since October 2022 and tightened in November 2023, according to an exclusive report by Reuters.

Why it matters: The Reuters report reveals loopholes in the US export restrictions on high-performance GPU chips to China. The findings have raised concerns within the US government about the efficacy and enforcement of these regulatory measures.

Details: Ten Chinese entities acquired advanced Nvidia chips integrated into server products produced by Super Micro Computer, Dell Technologies, and Taiwan’s Gigabyte Technology after the US tightened licensing rules for chip exports on Nov. 17 2023, the Reuters review of tender documents revealed.

• In China, trading in GPU chips coming from the US is not illegal. Chinese retailers may have fulfilled orders using stockpiles acquired before the US tightened chip export restrictions in November.
• The buyers included the Chinese Academy of Sciences, the Shandong Artificial Intelligence Institute, Hubei Earthquake Administration, Shandong and Southwest universities, a tech investment firm owned by the Heilongjiang provincial government, a state-run aviation research center, and a space science center.
• Nvidia responded by stating that the relevant tenders were for products exported and widely used before Nov. 17 2023. Sales may have included inventory previously exported to Chinese distributors, and the documents did not indicate that any of its partners violated export control regulations, Nvidia said. The US chip giant added that it would conduct further investigations into the matter.
• Dell told Reuters it had not seen any evidence of servers containing restricted chips being shipped to China after the embargo was implemented. “If we become aware of a distributor or reseller that is not complying with these obligations, we take appropriate actions, including termination of our relationship,” a Dell spokesperson said.
• Gigabyte said in an email to Reuters that the company consistently complied with related laws and international regulations. It did not reply to inquiries regarding tenders that identified its products as a source of banned Nvidia chips.

Context: Last October, the US government announced new export regulations to prevent the sale of advanced artificial intelligence chips to China, impacting on sales for US companies such as Nvidia, Broadcom, AMD, and Intel.

• Last December, Nvidia unveiled a Chinese version of the RTX 4090 graphics card to adhere to US regulations, in an effort to maintain its market presence. The Chinese version of the graphics card has a 12.8% smaller CUDA core (down to 14,592 from 16,384) and consumes 5.9% less power (425W from 450W) compared with the standard RTX 4090.

An avatar of JD founder Richard Liu participated in its third livestreaming show on Monday as part of a promotional event for this year’s World Book Day. Although the virtual Liu’s nearly 40-minute-long slot made for only a short section of the 11-hour-long e-commerce event, its appearance still suggests that the company sees use of the avatar as a headline- and hype-generating strategy as it looks to boost consumption on its platforms. 

Why it matters: As JD gears up for June’s 618 event, China’s second-largest shopping festival, the attempt to introduce highly life-like digital personalities as sales anchors aims to reduce merchants’ operational costs and compete against rival platforms’ more-established human-hosted livestreams.

• The e-commerce giant will reportedly offer free services to merchants to try avatar-based livestreams during 618.

Details: “I am ‘procurement and sales manager Brother Dong,’” the digital Liu stated as part of Monday’s livestream. The avatar’s latest appearance featured a multi-camera set-up and added an interactive session after previous shows were criticized for its mechanical pronouncements and a lack of interaction with audiences.

• Liu’s avatar introduced five sets of books during the show, including China’s four classical masterpieces, detailing his personal reasons for recommending the novels and highlighting their “price competitiveness” on JD. Each book set was priced at less than 50% of the regular price if viewers bought through links showcased on the left of the screen.
• JD has received “lots of” cooperation inquiries from merchants and brands after Liu debuted his livestreaming avatar last week, according to the chief algorithm officer of JD Cloud’s own large language model ChatRhino, which powers the virtual Liu. Some CEOs also plan to collaborate in bringing their avatars to live shows, the executive added in an interview with China media outlet Yicai.

Context: Earlier this month, JD announced a RMB 1 billion investment, awarded in cash, to incentivize content creators in short videos and livestreaming, aiming to drive the development of content creation on its platform.

Chinese electric vehicle brand Zeekr has grabbed the spotlight again after unveiling one of the finest luxury vans Chinese consumers can buy. The company says it is seeking to end the dominance of multinationals in the Chinese market, where dealers charge significant markups for similar offerings.

“This is among our top missions,” said Andy An, chairman of Geely Auto Group and chief executive of Zeekr, at a press event on April 19, calling the status quo “irrational” (our translation). An added that Chinese car brands now offer best-in-class luxury and safety as the market makes a transition to smart EVs. Dubbed “a royal suite” on wheels and a fully-electric answer to the Rolls-Royce Cullinan, the Zeekr 009 Grand costs only a fraction of the models that comprise BMW’s luxury lineup and costs less than the Toyota Alphard, one of its key competitors, at a price tag of only RMB 789,000 ($108,961).

The launch comes as Geely’s EV unit sees strong and continuous demand for its products on its home turf and is set to embark on a major push into global markets. The latest sales figures show that the Zeekr 001 has overtaken Tesla’s Model 3 as the best-selling battery-powered sedan in the Chinese premium car segment, as the company maintains its annual delivery target of 230,000 units for this year.

China’s answer to the Rolls-Royce Cullinan

The Zeekr 009 Grand boasts a combination of sophisticated craftsmanship and cutting-edge technologies and is geared towards the demands of Chinese celebrities and business leaders. Among the mesmerizing features include “curtain” glass that presents as pitch-black in less than two seconds and a single-click mode that deletes users’ travel history and contact data, designed to provide security and privacy. 

Zeekr is also upgrading its “giga-casting” technology, a technical term from Tesla that describes a process to diecast almost all vehicle underbody parts as one to improve car body stiffness. With the two rear seats coupled with die-cast vehicle frames in a C-shape formation, safety tests have concluded that the van’s interior remains intact following a rear-end collision by a 2.3-ton trailer at 50 kilometers per hour (31 mph), according to a video clip presented by the company. 

With only one variant, the 009 Grand has a driving range of 702 kilometers (436 miles) based on City Light Test Cycle (CLTC) standards, despite having more powerful motors than its original version.

The Chinese automaker says its four-seater outperforms the Rolls-Royce Cullinan in on-road performance with the adoption of artificial intelligence algorithms and adaptive dampers and air springs to smooth the ride, technology also embraced by BYD and Huawei. While Chinese carmakers from Li Auto to Great Wall Motor are carving out this increasingly important niche market, Zeekr said its special-edition 009 is winning customers over with its craftsmanship and quality materials, rather than with a more superficial luxurious design. 

Quest for growth amid slower EV uptake

Zeekr is emerging as one of the few Chinese EV makers bucking the trend of turning to plug-in hybrids in the middle of a bumpy transition to new energy vehicles (NEV), while aiming for strong growth despite an overall sluggish EV demand sentiment. The company just delivered more than 4,900 Zeekr 001 shooting brakes in the first two weeks of April, compared with roughly 2,100 units of Tesla’s Model 3 during the same period, according to figures compiled by Sun Shaojun, founder of Chinese consumer behavior research agency CarFans. 

Earlier figures also indicated sustained growth momentum as the revamped 001 pocketed roughly 30,000 non-refundable orders within 30 days of its launch on Feb. 27. BYD, Huawei-backed Aito, and Zeekr outperformed other brands in terms of new orders in the last week of March, Jefferies analysts said in an April 9 note. The companies have benefited from a spillover effect, as Xiaomi’s Porsche-alike sedan becomes a phenomenon, garnering huge attention for the smartphone giant as well as more established rivals. 

An told reporters during an interview that the long-term picture of the ongoing EV transition remains positive, with Zeekr maintaining a delivery target of 230,000 vehicles for 2024, almost double the nearly 119,000 units it achieved last year. It plans to enter dozens of countries in the Middle East, Latin America, and Southeast Asia this year, having started exports to Europe, the Gulf Bay area, and parts of Asia late last year. “In our view, Geely is at full steam for the EV race and overseas expansion with competitive NEV product offerings and an established global footprint,” Jefferies analysts said on March 27.

READ MORE:Interview: Zeekr executives on the 001 FR supercar, autonomous driving, and overseas plans

On Thursday, Huawei unveiled a letter on the Chinese X-like social media platform Weibo to announce the Pura 70 Series Pioneer Program, a scheme for people to purchase devices from its latest mobile phone series without holding a launch event. The new range was launched with minimal marketing, in a similar approach to the one the Chinese tech giant took when launching the Mate 60 series last August. The Pura 70 Pro/Ultra models went on sale in China on Thursday, while the Standard/Pro+ models will be available on April 22.

Huawei’s flagship lineup is currently categorized into the Mate and Pura series. The Mate line focuses on high-end flagship devices and targets business users, while the Pura range leans towards imaging capabilities and aesthetic design.

Why it matters: Huawei intentionally chose April 18 to launch the Pura 70 series, as it marks the 12th anniversary of the launch of Huawei’s first Pura series device, the Ascend P1. The latest Pura series smartphones are equipped with Huawei’s self-developed Kirin chip, an effort to counteract US chip sanctions.

Details: Similar to the Mate 60 series, Huawei’s Pura 70 series hit the market without a launch event. The first batch of Pura 70 series products sold out within minutes on Huawei’s e-commerce platform. A number of tech bloggers have managed to acquire the Pura Pro and Pura Ultra models first hand for phone performance tests, but Huawei has not publicly disclosed the specific chip details of the Pura 70 smartphone series.

• The tech blogger Digital Chat Station revealed that the processors in the Pro and Ultra models are both identified as the Kirin 9010. The Kirin 9010 processor achieved a single-core score of 1,442 and a multi-core score of 4,471 on Geekbench, a cross-platform benchmarking tool used to measure and compare the performance of CPUs and GPUs across various computing devices. For comparison, the iPhone 12 Pro obtained a single-core score of 2,101 and a multi-core score of 4,936 on Geekbench.
• The Kirin 9010 adopts the same 2+6+4 architecture design as the Kirin 9000s (Mate 60 series), with two cores clocked at 2.30GHz, six cores clocked at 2.18GHz, and four small cores clocked at 1.55GHz. It seems to be a slight upgrade over the Kirin 9000s, the blogger said.
• The Pura 70 series features a distinctive triangular camera module on the rear, along with Huawei’s self-developed HarmonyOS 4.2 operating system. The premium Ultra model supports BeiDou satellite network functions, including text messages, image messages, and satellite calls. 
• The Ultra model also boasts a mightier camera setup with a 1-inch main sensor with retractable lens and variable aperture. Its camera system offers a 50MP 1-inch primary sensor, a 40MP ultra-wide sensor, and a 50MP macro telephoto shooter.
• In terms of pricing, the Ultra model comes in two storage variants: 16GB + 512GB priced at RMB 9,999 ($1,382), and 16GB + 1TB priced at RMB 10,999 ($1,520). The Pro model is available in three versions: 12GB + 256GB priced at RMB 6,499 ($898), 12GB + 512GB priced at RMB 6,999 ($967), and 12GB + 1TB priced at RMB 7,999 ($1,105). 
• Currently, the Pura 70 series phones are limited to sale in the Chinese market. The market intelligence firm TechInsights predicts that Huawei’s smartphone shipments in China will exceed 50 million units in 2024, with its market share increasing from 12% in 2023 to 19% in 2024. The Pura 70 series is expected to ship over 10 million units in 2024, positioning it as a major competitor to the iPhone 15 and 16 series, according to TechInsights.

Context: The Huawei P series was rebranded as the Huawei Pura range on Monday, with the Pura 70 series becoming the first device under the new name. Huawei did not explain the meaning of Pura. However, “Pura” in Spanish translates to “pure” or “clean”, and it can also mean “genuine” or “true” in certain contexts.

“Three, two, one! Show [shopping] link!” Richard Liu, founder of Chinese e-commerce company JD, debuted his livestreaming show on Tuesday – using an avatar in his likeness. The billionaire’s virtual doppelganger drove total sales volumes to exceed RMB 50 million ($6.9 million) in less than one hour, the company said.

Why it matters: JD is finally trying to capitalize on China’s online retail trend for combining content forms and shopping, with the firm making huge investment bets in new areas. Liu’s rare public appearance, albeit through an extremely life-like avatar, demonstrates the urgency of change for the company as it plays catch-up to rivals that have cultivated high-popularity influencers over many years.

Details: Liu’s avatar is powered by the company’s ChatRhino large language model, according to a WeChat post that JD published on Wednesday. The post added that its AI-driven virtual hosts now serve more than 4,000 brands.

• Liu appeared simultaneously in two live shows that lasted less than an hour each, showcasing a total of 13 products, including steak and milk. Although his virtual persona successfully replicated his habit of waving his hands while speaking, the segments where he introduced the products sounded mechanical, lacking interaction with the audience.
• Beijing-based JD experienced a sudden traffic explosion last November as its procurement and sales team joined livestreams as hosts to sell hot items including the iPhone 15 series at lower-than-market prices. Different from other e-commerce platforms, JD said its model has no additional costs such as advertising fees or commissions for invited hosts.

Context: JD’s revenue grew by 3.7% in 2023 to RMB 1,084.7 billion, significantly slower compared to its 27.6% growth in 2021 and a 9.9% increase in 2022, as the e-commerce space has been slow to recover post-pandemic due to belt-tightening by price-sensitive consumers.

China’s search engine operator Baidu said Tuesday the number of users of its AI-driven ERNIE Bot has doubled to over 200 million in four months, declaring itself a leader in artificial intelligence, as competitors rush into the sector. The company also added that ERNIE now handles 200 million daily queries.

Why it matters: Baidu’s chatbot has revived confidence in the company’s monetization of AI, with its 200 million users offering new potential avenues for growth. 

Details: Co-founder and CEO of Baidu Robin Li expressed confidence that natural language will emerge as the new programming language in the future in his speech titled “Everyone is a Developer” at the company’s AI Create conference on Tuesday.

• Baidu released three AI development tools during the event – AgentBuilder, AppBuilder, and ModelBuilder, underpinning Li’s view that developing apps should become “as straightforward as making a short video.” According to video demos showcased during the talk, these tools can even help users without any coding skills build apps.
• More than 190,000 AI apps were created through Baidu’s Qianfan cloud platform by over 85,000 businesses, the company claimed in the latest figure.
• In the speech, Li explained the “fine-tuning and post-pre-train methods” based on ERNIE 4.0, the firm’s current most advanced foundation model, enable the creation of models with better results at a lower cost compared to models tuned directly from open source models, which is why Li said he thought open-source models would become “more and more outdated.” His earlier comment that open source models “make little sense,”  recently sparked contention on social media among Baidu’s counterparts. 
• Rival Alibaba developed an open source large language model last August, becoming the first Chinese tech major to do so. Others, including startup 01.AI, founded by Kai-Fu Lee and Baichuan built by Sogou’s founder, both chose to make their billions-parameter models open source soon after.

Context: China’s regulator approved 117 large language models for generative AI services on March 25, according to the Cyberspace Administration of China (CAC). The scope of approvals signals stiff competition among tech companies scrambling to create potential from the technology’s commercial application.

• A recent chart finds Baidu, which was amongst the first batch to open its ChatGPT-like bot to the market last August, is being chased by rival company Moonshot AI-trained Kimi, which specializes in analyzing long text, in terms of total traffic. ERNIE Bot recorded 14.9 million clicks in March, while Kimi’s combined traffic surged by 321.58% to 12.6 million.

Chinese automaker GAC Group said on April 12 that it had broken through several obstacles regarding the durability and safety of “all-solid-state” batteries, and expected its future rollout of the technology to offer drivers a range of over 620 miles per charge by 2026. 

GAC, which made the announcement at its annual Tech Day, is among the few Chinese automakers to have offered specific plans in the race to market for next-generation advanced electric vehicle batteries. Toyota’s long-time partner has opted for a solid electrolyte system that sets it apart from the Japanese giant, by far the world’s leading holder of solid-state battery patents, according to Nikkei’s study. 

Why it matters: The development is the latest example of liquid-state lithium-ion pack leader China ramping up efforts to master the technology, as global auto giants expect solid-state batteries to give them an edge over competitors in the EV transition. 

• Global auto majors and battery makers have been adopting three highly promising solid electrolytes in place of a liquid one, a key element that allows the movement of lithium-ions between cathode and anode during charge and discharge cycles. Japanese and Chinese manufacturers primarily focus on sulfides and oxides, respectively, while Western makers are betting on both candidates and paying additional attention to polymers, according to market intelligence provider TrendForce.

Details: GAC claims its batteries offer better safety compared with not only liquid-based batteries but also solid-state alternatives, while achieving an energy density of 400 watt-hours per kilogram (Wh/kg), a roughly 60% rise compared with CATL’s highly advanced Qilin battery. It features a hybrid solid-state electrolyte based on both oxides and sulfides, among other materials. 

• The automaker said it developed a thin interphase film over the solid electrolyte surface, formed by a highly dense composite material in a special design that enhances structural durability and battery mechanics. This largely protects the battery from metal filaments known as “dendrites,” which may penetrate the solid electrolyte and eventually short the battery cell, allowing it to maintain thermal stability at 200°C above operating temperature. 
• GAC is also bringing out solid-state batteries with high-loading silicon anodes, adding that it has largely stopped extreme volume expansion and contraction of the anodes during electrochemical reactions, which harms solid electrolytes and often results in a poor overall battery cycle life. The latest prototype of GAC’s solid-state battery has undergone more than 100 charging cycles, retaining over 60% of its initial energy capacity, according to figures released by the company on April 12. 
• One of the major challenges for the large-scale use of oxide-based batteries is that their production is expensive and has fewer synergies with conventional manufacturing processes, according to an analysis published by Spanish research center CIC EnergiGUNE last May. And yet, the automaker said it can produce 30 Amp-Hour (Ah) battery cells while reducing costs in a push for volume production. GAC’s Hyper EVs are expected to travel more than 1,000 kilometers (621 miles) on a single charge in 2026, thanks to the technology.

Context: Experts say there is little agreement for now on which solid-state battery technologies will win out, and the timeline for their mass production and deployment remains uncertain. TrendForce generally projects that solid-state batteries may enter mass production between 2030 and 2035, with an energy density of 500 Wh/kg, offering a driving range two to three times greater than existing offerings. 

• Some early efforts at the game-changing technology are underway in other parts of the world. Toyota is aiming to market all-solid-state batteries as early as 2027, which could enable a range of 1,200 km and a charging time of just 10 minutes for its EVs, reported Reuters. Samsung SDI is looking at a similar timeline, saying last month that its plan for mass-producing such batteries in 2027 is well on track, while Nissan and BMW are aiming for 2028 and 2030, respectively.
• Several Chinese auto and battery majors, including Changan and CATL, are making semi-solid-state batteries, a more gradual alternative that uses a small amount of fluid or gel electrolyte in addition to a solid-state electrolyte. SAIC said last month that its upcoming EV under the Intelligence in Motion (IM) lineup will feature a semi-solid-state battery pack, with liquid accounting for 10% of the battery’s weight. The IM L6 sedan is scheduled for launch in May. 
• State-owned GAC has operated a plant to produce conventional lithium iron phosphate (LFP) batteries for its Aion-branded EVs in its hone base of Guangzhou since last December, which is expected to have an annual capacity of 36 gigawatt-hours by 2025. It also invests in technologies such as autonomous driving and flying cars, planning to roll out an advanced driving system for city roads using cameras, rather than high-precision maps and lidar sensors, in 2026. 

Intel is preparing to launch modified Gaudi 3 chips for the Chinese market when it releases the new generation AI accelerator chip this year, according to British technology media outlet The Register. Intel has disclosed the existence of the two China-exclusive models in its Gaudi 3 white paper, with HL-328 set to launch on June 24 and HL-388 on September 24.

Why it matters: Intel’s launch of customized Gaudi 3 chips for China is part of the American chip giant’s efforts to work within US sanctions on chip exports to China.

Details: Based on the information provided in Intel’s Gaudi 3 white paper, the Chinese editions of the Gaudi 3 models may ultimately require a reduction of around 92% in AI performance to comply with US export controls. 

• Due to US export restrictions, high-performance AI chips need a computing performance below 4,800 TPP (total processing power) to be eligible for export to China. This implies that the 16-bit performance of the Chinese editions of the Gaudi 3 chips will not exceed 150 teraflops.
• Similar to the Nvidia’s Chinese-edition H20 chip, the two modified Intel chips will offer a 148 teraflops of FP16/BF16 performance, just below the permitted limit.
• According to Intel, the original version of the Gaudi 3 chip can achieve 1,835 teraflops in FP16/BF16, formats used in computing to represent a balance between accuracy and efficiency for chips commonly used for AI to process large amounts of data quickly and efficiently. 
• Compared to the original version, the HL-328 and the HL-388 versions have the same 96 MB cache, 128GB of HBM2e memory with a bandwidth of 3.7TB/s, PCIe 5.0 x16 interfaces, and decoding standards. However, both models are capable of just 450 watts of thermal design power (TDP), while the original versions of respective models have a higher TDP of 600 watts and 900 watts.

Context: In the first quarter of 2024, Nvidia strategically re-entered the Chinese market with the H20 AI chip. In terms of performance, the modified-for-China H20 chip’s AI computing power is slightly less than 15% of the H100, the original version of the chip available in the rest of the world.

At Huawei’s spring product launch event on Thursday, Consumer BG CEO Yu Chengdong introduced the MateBook X Pro, a slim lightweight laptop featuring cutting-edge technology such as the Intel Core Ultra 9 processor and Pangu AI integration. Huawei did not disclose any information about its next-generation Huawei P70 flagship smartphone at the event however, despite it becoming a trending topic on Chinese social media in recent days.

Why it matters: The MateBook X Pro stands out from other laptops produced by the Chinese tech giant as the first PC to integrate its Pangu large language model. Huawei has collaborated with AI-model partners such as Baidu’s ERNIE Bot, WPS AI, and iFLYTEK’s Spark on the new computer.

Details: The MateBook X Pro is currently the sole laptop weighing less than one kilogram to be equipped with the Intel Core Ultra 9 processor, according to Yu.

• The 2024 slimline model has a thickness of 13.4mm and weight of 980g. An image shown at the event indicated that the 14.2-inch design is lighter than the 13.6-inch Apple MacBook Air (1.24kg). 
• The new model comes in two chip variants: the first generation Intel Core Ultra 9 185H processor and the Ultra 7 155H processor. These variants are paired with an Intel Sharp Graphics card, with options for 16GB or 32GB of RAM, and either 1TB or 2TB of NVMe PCI storage. Notably, the latest Intel Ultra 9 processor can enhance the device’s performance with up to 40W of power.
• The device supports the latest Pangu AI model, which provides artificial intelligence features including AI Minutes, AI Subtitles, and AI Eyes. AI Minutes can make rapid recordings, while AI Subtitles translates texts in real-time. AI Eyes is a photo enhancement software that can analyze and adjust images.
• The 2024 Huawei MateBook X Pro introduces a 14.2-inch OLED screen with a 3:2 ratio and a 3,120 x 2,080 pixel resolution. It boasts a peak brightness of 1,000 nits, a 120Hz refresh rate, and 1.07 billion color display.
• The MateBook X Pro is equipped with a 70Wh lithium polymer battery and supports fast charging at 140W. A 10-minute charge powers the device for up to three hours, the company claimed. 
• It is available in China in three configurations: the Ultra7 model with 16GB RAM and 1TB storage priced at RMB 11,199 ($1,658), the Ultra7 model with 32GB RAM and 1TB storage priced at RMB 12,499 ($1,727), and the Ultra9 model with 32GB RAM and 2TB storage priced at RMB 14,999 ($2,072).

Context: During the nearly two-hour launch event on Thursday, Yu did not once mention “far ahead,” a phrase that he had consistently used at previous product launches and which had gone viral on Chinese social media. Huawei has allegedly stopped him from using this term to describe products, according to local media outlet IThome. 

• Huawei President Ren Zhengfei has allegedly imposed a fine of RMB 10,000 for anyone from the company using the phrase “far ahead,” IThome reported. However, Yu previously denied the existence of such an order.

China’s commerce minister Wang Wentao talked with the heads of major car manufacturers including BYD and Geely on April 7 in Paris, as the companies scramble for solutions to an ongoing probe by the European Commission that could result in substantial tariffs on their imports of electric vehicles into the EU. 

Why it matters: The meeting comes as the EU prepares to publish its findings on whether Chinese automakers have benefited unfairly from state subsidies. Brussels could raise tariffs from the current 10% to at least 25% according to an estimate by European environmental lobby group Transport & Environment (T&E). 

• Chinese automakers have called for government support to push for a reduced tariff hike and to counter increased international political involvement in the industry, sources with knowledge of the matter told financial media outlet Caixin (in Chinese). Representatives of BYD, SAIC, and Geely were said to have accompanied Wang during his trip.

Details: At a roundtable discussion with the business leaders, Wang stressed the importance of Chinese automakers expanding overseas markets “in an orderly fashion” and embracing competition, according to a Twitter post by the China Chamber of Commerce to the EU (CCCEU)

• China also expects its manufacturers to bolster the integrated development of investment and trade, and maintain their commitment to technological innovation, Wang said. He added that claims that China’s EV competitiveness stems from state subsidies and comes with overcapacity issues in China are false and baseless. 
• During the April 7-9 trip, Wang also met with Franck Riester, France’s foreign trade minister, state broadcaster CGTN reported, as well as Renault chief executive Luca de Meo, acting chairman of the European Automobile Manufacturers’ Association. De Meo suggested that Chinese automakers establish their supply chain locally, sources told Reuters.

Context: France has backed the Commission investigation, according to Reuters, and has recently changed subsidy rules in a way that effectively excludes Chinese EV models. 

• China has in return requested French cosmetics giants including L’Oreal and LVMH comply with its data security rules by reporting details related to manufacturing processes and ingredients. It also launched an anti-dumping investigation into EU brandy exports in January. 
• Wang’s trip comes ahead of Chinese President Xi Jinping’s expected visit to Paris and discussions on trade tensions with French counterpart Emmanuel Macron, scheduled for May. This will be Xi’s first trip to Europe in five years, as tensions grow between China and the EU.
• The Commission reportedly carried out visits to BYD, SAIC, and Geely for verification work early this year, followed by the launch of a special custom registration process for China-made EVs, as imports rose by 14% year-on-year since formal investigations began last October. 
• Major Chinese automakers, including BYD, SAIC, and Chery, are also planning to construct their own car factories in Europe while also building vessels for shipments, as they look to capture a significant market share in the region with their affordable EVs.

Moonshot AI, an artificial intelligence startup founded in China a year ago, has quickly narrowed the gap with rival Baidu’s ERNIE Bot in terms of users after upgrading its large language model Kimi to be able to handle text inputs of up to two million Chinese words in March.

According to a survey conducted by data website AIcpb, Kimi saw its combined website and app traffic top 12.6 million views last month, bringing its ranking up to second place behind Baidu’s chatbot, which received 2.29 million more views. 

Why it matters: The quadrupling of Kimi’s visit count in March meant the ChatGPT-like tool surpassed Alibaba’s competitor Tongyi Qianwen. Its ability to handle long texts is fueling Kimi’s popularity among users, raising hopes among its backers that it will soon break Baidu’s months-long hold on the top position in China’s AI sector.

Details: Moonshot focuses on longer textual inputs and outputs, a new battlefield for Chinese LLM companies. Alibaba opened up a free long-document processing feature that can handle 10 million characters following Kimi’s upgrade, while Baidu plans to support longer text conversations later this month.

• Less than 72 hours after Kimi claimed a technological breakthrough in handling 2 million Chinese characters, the chatbot experienced a service outage. The crash, which lasted at least two days, was blamed on “an abnormal increase in system traffic far exceeding the system’s capacity,” by the company, as users rushed to try out the new feature.
• In a recent interview with Tencent Technology, Moonshot founder Yang Zhilin noted that a focus on long texts was decided upon at the company’s inception. “It’s fundamental,” Yang said, noting that the core value of AI lies in personalized interaction, best achieved, he believes, not through fine-tuning but by supporting broader contexts.
• He also said that while there is “significant room” for expanding text length, focusing on the numbers alone is “meaningless.” Instead, reasoning, faithfulness, and clear instruction-following are what matters.

Context: Moonshot AI reportedly raised over $1 billion in funding earlier this year from existing shareholders such as Alibaba, Sequoia China, and Xiaohongshu, marking the largest single-round financing for a Chinese AI big model company to date. The company raised nearly RMB 2 billion ($277 million) last year.

The US Department of Commerce and the semiconductor foundry TSMC jointly announced on Monday that they have reached a preliminary agreement to provide the Taiwanese manufacturer with up to $6.6 billion in subsidies under the US CHIPS Act to support the construction of advanced semiconductor manufacturing facilities in Phoenix, Arizona. As part of the agreement, TSMC will also construct its third fab in Phoenix, bringing its total investment in the US to over $65 billion.

Why it matters: The agreement supports TSMC’s expansion in the US while also demonstrating a strategic partnership to strengthen advanced semiconductor manufacturing in the country as it concurrently looks to limit China’s development in the field.

Details: Following the subsidy announcement, TSMC revealed plans for a third fab in Arizona to introduce 2nm process chip technology or more advanced processes, with production beginning by the end of the decade.

• TSMC Arizona’s first fab is set to gear up for production of 4nm chips by the first half of 2025, while the second fab will produce both 2nm and 3nm chips in 2028.
• TSMC Arizona will establish a cutting-edge cluster, generating 6,000 direct manufacturing roles, over 20,000 construction jobs, and tens of thousands indirect employment opportunities in the next decade, according to the US Department of Commerce.
• With this new funding, TSMC’s total investment in the US has increased from $40 billion to $65 billion. This investment represents the largest foreign direct investment in Arizona history, and the largest foreign direct investment in a greenfield project in US history, TSMC said in the statement.
• “Our US operations allow us to better support our US customers, which include several of the world’s leading technology companies. Our US operations will also expand our capability to trailblaze future advancements in semiconductor technology,” said TSMC Chairman Dr. Mark Liu. 
• TSMC is the fifth company to receive public subsidies from the US government since the enactment of the CHIPS Act in 2022, and the only foreign entity to date, according to Chinese media outlet Jiemian. The other four companies are BAE Systems, Micron, Qualcomm, and Intel, which received subsidies of $35 million, $162 million, $1.5 billion, and $8.5 billion respectively.
• TSMC holds over 60% of the global orders for advanced process chip manufacturing, with nearly 70% of its clients coming from the US, the same Jiemian report said. According to TSMC’s previous financial conference calls, the focus of the Arizona factory is to serve clients in the US.

Context: The current construction of two fabs by TSMC in Phoenix is experiencing delays due to issues such as a shortage of skilled workers, as revealed by Chinese media outlet Icsmart.

• Fab 1’s production of 4nm technology has been delayed from 2024 to 2025, while Fab 2’s 3nm production, initially planned for 2026, is now scheduled for 2028. The two fabs are intended to produce over 600,000 wafers per year, potentially generating a market value exceeding $40 billion annually.

Major Chinese car manufacturers, including SAIC and BAIC, saw double-digit declines in annual profits as the industry was hurt by slowing growth in new fossil fuel car sales and aggressive price cuts for their electric vehicles amid rising competition from the likes of BYD and Tesla. 

Why it matters: The latest financial results coincide with the rising momentum of plug-in hybrid electric vehicle (PHEV) sales in China. BYD, Geely, and Li Auto, all with a broad PHEV lineup, are among the few that reported both revenue growth and margin improvements, while traditional automakers and battery electric vehicle startups have been put under pressure to sacrifice profits for growth. 

• The figures also signaled potential growing challenges for international carmakers as Chinese EV manufacturers take a stronger position at home. The market share of their joint venture brands with Chinese partners will fall from 40% to 10% over the next three to five years, BYD chairman Wang Chuanfu forecast at an investor meeting on March 27, reported Reuters. 

Details: China’s biggest car manufacturer SAIC reported revenue of RMB 744.7 billion ($102.9 billion) in 2023, an increase of just 0.1% from the same period last year, with net profit declining 12.5% year-over-year. Sales of its joint ventures with Volkswagen and General Motors last year fell 8% and 14.5% to roughly 1.2 million and 1 million units, respectively. 

• BAIC Motor, a Hong Kong-listed unit of BAIC Group, also disappointed investors with a slower pace of revenue growth of just 3.9% in 2023, marking a slowdown from the brisk 8.3% rate notched a year earlier. Mercedes-Benz Group kept China sales flat with its joint venture partner last year, having slashed car prices by as much as a third over the last three months of 2023. 
• Revenue of GAC Group grew at a solid clip last year partly thanks to strong sales of its Aion EVs. However, Toyota and Honda’s main China partner revealed a 45.1% nosedive in net profit to RMB 4.4 billion, which it blamed on an RMB 2.9 billion one-time loss due to charges tied to restructuring, as well as shrinking revenue at its joint venture with Mitsubishi.
• Great Wall Motor’s annual results also offered a mixed picture as it struggles to ramp up EV sales profitably. Revenue grew a more robust 26.1% year-on-year to RMB 173.2 billion, but its profits fell 15.1% to RMB 7 billion. Some of its PHEV models such as Lanshan and Gaoshan fell short of expectations, Bernstein analysts wrote in a March 28 note. 
• Dongfeng Motor Group posted a loss of nearly RMB 4 billion for 2023, compared with a profit of almost RMB 10.3 billion, marking its first annual loss in nearly two decades since going public in Hong Kong in 2005. Sales of its two joint ventures with Nissan plunged 21.5% and 10.2%, while deliveries of its proprietary passenger EVs declined 5.1% to roughly 303,900 units.

Context: Beijing is planning to unveil new measures to boost the performance of FAW, Dongfeng, and Changan, three automakers directly under the leadership of China’s State-owned Assets Supervision and Administration Commission (SASAC), by giving them more leeway and independence in EV operations. Local government-owned businesses, including SAIC, BAIC, and GAC, are also expected to benefit from the policy in the coming months.

READ MORE: Chinese officials reaffirm commitment to EV ambitions and promise raft of support measures amid industry doubts

Alibaba’s chair Joe Tsai commented that by not focusing on truly creating customer value, they had “stepped on our own foot” in recent years, when explaining why he thought the e-commerce giant had been “falling behind”. Tsai’s remarks were made in an interview with Nicolai Tangen, chief executive of Norway’s Norges Bank Investment Management, at a time when the Chinese tech giant has undergone frequent organizational restructures.

“We forgot about who our real customers are,” Tsai told Tangen. “Our customers are the users who use our apps, that are shopping, and we did not give them the best experience.”

Why it matters: Tsai’s conversation with Tangen ranged in topics from Alibaba’s internal reckoning and competitiveness in artificial intelligence, to China’s consumer market potential, in a major signal to the outside world that Alibaba is aware it needs to make changes to keep its customers.

Details: The biggest reorganization in Alibaba’s history, which began last March when it decided to split the group into six units and give multiple businesses the freedom to seek funds or go public, has been fraught with twists and turns. It has now suspended its logistics arm Cainiao’s Hong Kong IPO application and canceled plans to divest from its cloud operation.

• Tsai said China is “probably two years behind the top [large language] models,” with the US’s curbs on exporting high-end chips to China part of the reason the country is behind in the AI space. But he mentioned Alibaba has “made some efforts” when it came to the manufacture of high-end GPUs, while also sourcing chips from other players, without giving further details.
• In China, where consumers are highly price-sensitive, Tsai said he believed the ability to spend among Chinese “is there”, but that the downturn in the real estate and job markets has put a dent in consumers’ confidence and willingness to spend. He struck a more positive note when he said he still saw “great potential” for growth in China’s overall consumption rates that would eventually reach levels comparable with markets in the West. 
• The chair of Alibaba also noted in the interview that giving incentives and confidence to investors, as well as hired people, is “important”, especially for private businesses, and that the company is buying back stock at a rapid pace to bolster market value. Alibaba spent $4.8 billion on buybacks in the first quarter, the second-largest quarterly buyback amount in its history.

Context: Norges Bank Investment Management looks after Norway’s sovereign wealth fund,  a major Alibaba shareholder with a stake worth $3.5 billion at the end of last year. The world’s largest sovereign wealth fund also owns shares in Alibaba’s top competitors, PDD and JD. The fund raised its position in Temu parent PDD by 117.9% last year, compared to a less than 10% increase in its Alibaba holding.

US sports camera firm GoPro has filed a complaint against Chinese camera maker Shenzhen Arashi Vision (Insta360) with the United States International Trade Commission (USITC) under Section 337 of the Tariff Act of 1930, according to information obtained by Chinese media outlet Jiemian. GoPro is claiming patent infringement and asking USITC to investigate the matter and halt the US sale of certain Insta360 cameras, software, and accessories.

Why it matters: GoPro is seeking intervention from USITC to investigate and prevent the sale of the disputed products in the US.

Details: GoPro has submitted evidence of patent infringements to the commission covering nearly all the consumer products sold by Insta360 in the US.

• The products mentioned by GoPro are Insta360’s ONE X, ONE R, ONE R1-inch, ONR X2, ONE RS, ONE RS 1-inch 360, X3, GO3, Ace, and ACE Pro, according to the Jiemian report.
• The Section 337 investigation initiated by GoPro, also known as an “unfair import” investigation, is an administrative inquiry conducted by USITC under the provisions of the Tariff Act of 1930 and its amendments. It targets intellectual property infringement and other unfair competitive practices by goods importers.
• Compared to normal patent litigation in the US, which can last over two years, 337 investigations generally resolve faster. However, they require companies to swiftly gather evidence, hire lawyers, and bear costs that can total millions of dollars.
• The Jiemian report suggests that GoPro’s market share has declined due to the rise of Insta360, which was founded in 2015. By the end of 2021, Insta360 held a leading market share of 41% in the global market for panoramic cameras, followed by Japan’s Ricoh at 22%, while GoPro ranked third with 19%, according to consulting firm Frost & Sullivan.
• Established in 2002, GoPro’s latest market value is $331 million, over 97% lower than its peak market value of $13 billion in June 2014, when GoPro listed on the NASDAQ. Insta360’s overseas markets account for nearly 70% of its overall revenue, which were around $280 million in 2022.

Context: In 2023, USITC undertook investigations into 72 Chinese companies, of which 48 chose to respond, the Jiemian report said.

• California-based GoPro manufactures action cameras and develops its own mobile apps and video-editing software. The company focuses on the connected sports genre, developing action cameras and video editing software for outdoor activities. 
• Arashi Vision, better known as Insta360, is a camera company headquartered in Shenzhen, with offices in Los Angeles, Tokyo, and Berlin. It makes action cameras, 360-degree cameras, editing software for mobile and desktop and 180-3D cameras.

Major Chinese automakers, including Geely and Changan, have strategically introduced big discounts to their car prices or new variants of existing models despite posting a pickup in March deliveries, in a defensive move after Xiaomi’s first car reached nearly 90,000 pre-orders in just 24 hours. 

Xiaomi’s smash hit: The initial success of Xiaomi’s first EV, rolled out on March 28 with a lower-than-expected price tag, is having a knock-on effect on most other automakers which are being forced to take immediate action in order to hold on to their market shares. 

• The reservation-to-order conversion rate of the electronics brand’s SU7 has currently reached more than 35%, according to Sun Shaojun, founder of consumer behavior research agency CarFans. 
• Around 40% of Xiaomi customers canceled their pre-orders partly due to an expected long waiting time for vehicle delivery, Sun said in a Tuesday post on WeChat. Some were also frustrated by awkward sales-service interactions at overcrowded Xiaomi stores in major cities, Sun added, as the Chinese smartphone giant is gradually expanding its sales network for car retail. 
• Nevertheless, this is equal to a volume of at least 31,000 non-refundable orders in just four days, still an impressive performance for a new entrant and one that sees it surpass the early sales figures of Aito, a rising player launched by Xiaomi’s long-time rival Huawei.

March sales, discounts: Sales of Geely’s new energy vehicles (NEVs) rose 65% year-on-year and 34% month-on-month to 44,791 units in March, of which roughly 13,000 were Zeekr-branded battery EVs, partly driven by the strong sales of its refreshed 001 sports wagons, delivery of which began on March 1. 

• Geely on Monday launched a new rear-drive Zeekr 007 sedan, turning a bundle of add-ons into standard features including a large head-up display unit and heated and ventilated seats, at a price tag that is RMB 6,000 ($829) cheaper than Xiaomi’s SU7. 
• This comes after a similar move by Changan which two days earlier introduced a new entry-level variant of its Avatr 12, lowering the starting price of the premium sedan by 12% to RMB 265,800. Avatr’s deliveries more than doubled to 5,016 units last month. 
• Meanwhile, Huawei-backed Aito, which sells both battery EVs (BEVs) and plug-in hybrid EVs (PHEVs), edged out rival Li Auto for a third month in March with 31,727 deliveries compared to Li Auto’s 28,984, buoyed by strong demand for both the M7 and M9 crossover. 
• Aito claimed the M9 was the top-seller in the RMB 500,000-plus price segment in China last month, a title Li Auto had previously aimed for (and failed to reach) with its Mega van. Still, the EV brand, co-launched by Huawei and Seres, on Monday slashed the starting price of its best-selling five-seater by 8% to RMB 229,800. 
• NIO and Xpeng Motors deliveries also jumped significantly through March, and yet both are either slashing prices or using other promotions to lure customers. NIO’s ET5 and Xpeng’s P7i sedans compete in the same price segment as the Xiaomi SU7. 
• NIO said on Monday it will offer a reduction of RMB 10,000 for those who replaced their gasoline cars with a new EV. Xpeng’s G9 crossover now costs RMB 20,000 cheaper than its original list price, following a more than RMB 10,000 price reduction across its lineups a month earlier. 

READ MORE: Explainer: How a new round of price cuts are reshaping China’s EV market

Context: The March sales figures – which showed a rebound from the annual Chinese New Year holiday slump – also indicated a stronger growth momentum for PHEVs than BEVs with a growing number of carmakers pivoting to more affordable PHEVs as they look to expand NEV sales in China’s vast majority of underdeveloped regions.

• PHEVs accounted for more than half of BYD’s sales and enjoyed a higher growth rate than BEVs over the first three months of this year, according to a regulatory filing posted on Monday (in Chinese). The country’s biggest EV maker was followed by the likes of Geely, Aito, and Li Auto, all preferring a broader product portfolio to purely BEVs.
• Ouyang Minggao, an academic at the Chinese Academy of Science, said last month that PHEVs could grab substantial market share from internal combustion engine cars in the coming years, especially in the entry-level price segment, and expected more widespread adoption of BEVs over the next decade.
• EV adoption in China’s lower-tier cities and rural regions is slower than in the country’s more developed areas. A growing number of EV owners from lower-tier cities said they will go back to conventional automobiles for their next purchase due to a lack of charging infrastructure, according to an annual report by consultancy McKinsey released on March 12. 

READ MORE: Chinese officials reaffirm commitment to EV ambitions and promise raft of support measures amid industry doubts

On March 29, Chinese tech company Roborock hosted its global launch event in Beijing, unveiling two flagship cutting-edge robotic vacuums: the V20 and G20S (S8 MaxV Ultra), both of which are intelligent automatic sweeping and mopping robot cleaners. The V20 features a dual-vision 3DToF (three-dimensional time of flight) solid-state lidar (light detection and ranging) system, giving it advanced navigation and obstacle avoidance capabilities.

Why it matters: A leading brand in the field of robotic vacuum cleaners, Roborock is looking to use technology from China’s rapidly developing self-driving car sector in the hopes that the country’s consumers are ready for robotic home appliances and labor-saving devices. 

Details: At the launch event on the eve of the company’s 10th anniversary, Roborock CEO Quan Gang said the firm’s robotic vacuum cleaner sales revenue has clinched the global top spot, based on data from the first three quarters of 2023, according to market research firm Euromonitor. “Our goal is to bring Roborock robotic vacuum cleaners into one hundred million households worldwide,” he said.

• Currently available only in China, the V20 is the world’s first robotic vacuum cleaner to feature a dual-vision 3DToF solid-state lidar navigation and obstacle avoidance system, which utilizes modulated light reflections to enhance depth accuracy for more intuitive floor mapping.
• Roborock, in partnership with industry leaders PMD Technologies, Infineon, and OFILM, jointly developed this dual-vision 3DToF solid-state lidar system. It emits an instant matrix laser that enables simultaneous far and near field visibility, achieves precise map restoration, and ensures ultra-accurate obstacle avoidance. Alongside this system, the V20 also applies AI to match users with a suitable cleaning method.
• The G20S features the FlexiArm Design Side Brush, an innovative robotic arm designed to clean corners, and an additional side mop for edges. It also includes Reactive AI 2.0 obstacle recognition, a built-in intelligent voice assistant, and RockDock Ultra, which automatically replenishes the robot cleaner using hot water and heated air, as well as intelligent mop re-washing and re-mopping capabilities.
• The company said the Roborock app, which controls the robotic vacuum cleaners, boasts over 11 million users, with one million daily active users. The Roborock app’s room map is designed with intensive color contrast for visually impaired users.
• Catering to China’s animal lovers, the app has recently introduced a Pet Mode that can remotely search for and photograph pets at home with the robotic vacuum. 
• Roborock has developed a case library that covers over 50 wall and baseboard materials and over 200 carpet materials, according to data provided by the company. This library is used to develop and test its products’ mapping and navigating capabilities.

Context: Founded in July 2014, Roborock is a Beijing-based tech company known for its robotic sweeping and mopping devices and handheld cordless stick vacuums. Xiaomi played a key role in the company’s founding.

• From 2019 to 2023, Roborock invested over RMB 1.9 billion ($260 million) in research and development, according to figures provided by the company. The firm currently operates three major R&D bases, with over half of its workforce consisting of highly skilled R&D employees. Currently, Roborock products are available in more than 170 countries, including the US, Germany, France, and Spain.
• According to Roborock’s latest financial earnings report, the brand recorded a revenue of RMB 8.65 billion last year ($1.22 billion), with robot vacuum shipments surpassing 2.6 million units.

Hundreds of people flocked to a Xiaomi store in the southern Chinese city of Guangzhou in the late hours of Thursday evening to be among the first to take a look at what many deem to be the electronics brand’s more affordable alternative to a Porsche, as the brand announced a lower than expected starting price for its debut electric vehicle. That’s what TechNode observed during a livestream broadcast by a Chinese electric car blogger on social media app WeChat that attracted more than 200,000 viewers within an hour. 

Xiaomi has already enjoyed a debut win after securing a record 50,000 pre-orders in just a few minutes following its SU7 EV launch event. The official livestream racked up nearly 43 million views on microblogging platform Weibo, underscoring the overwhelming interest among tech-savvy Chinese consumers in the company’s first car. Those making a reservation were asked to pay a RMB 5,000 ($692) deposit as part of the process, with the tech giant expressing its thanks to customers who did so in a brief statement on the microblogging platform Weibo (in Chinese). 

The all-electric sports sedan is selling at a lower than expected starting price of RMB 215,900 ($29,881), roughly $4,100 cheaper than the popular Tesla Model 3, while touting better performance from driving range to acceleration. The dual-motor all-wheel drive version competes with the Porsche Taycan with a top speed of 265 kilometers (165 miles) per hour at a price tag of only RMB 299,900.

Xiaomi’s car launch contrasts markedly with Apple’s surprise retreat from the EV landscape, after the iPhone maker reportedly scrapped its decade-long effort to make a car recently. “We will provide every user, including those with Apple devices, a smart and connected life experience everywhere, creating seamless integration in their homes, cars, and beyond,” Xiaomi chief executive Lei Jun said during the press conference (our translation). 

“A trump card”

Lei, the 55-year-old serial entrepreneur dubbed “China’s Steve Jobs”, tried to lure users away from traditional carmakers during the two-hour event by showcasing how Xiaomi’s ecosystem would provide universal connection and integration between different devices, including phones, cars, and gadgets at home. 

Xiaomi essentially promised potential buyers that their devices would be all tied together with a click, swipe, or a simple voice command. The car’s air conditioning will cool the interior down on a hot summer’s day once the owner tells a home speaker what temperature they want before even leaving the house, according to one example given. In another, the car’s dashboard could become a centralized command station for home accessories which will be activated as the driver approaches home. 

Although rival Huawei has touted similar efforts with its EV partners, Xiaomi claimed last November that more than 655 million devices have been connected to its IoT (Internet of Things) platform, from televisions to fitness bands, making it the biggest network of its kind worldwide. “This is a trump card from Xiaomi,” said Lei when discussing the linking of the brand’s new EV with its IoT network. 

“Better than Tesla”

Meanwhile, Lei mentioned Xiaomi’s plans to be “among the top-tier players” in autonomous driving, a field where Tesla already stands out as a pioneer globally and Huawei is establishing its name at home. The company said its EVs are already capable of traveling more than 300 km on average autonomously on Chinese highways before human drivers take over and will be able to complete most trips by themselves on urban streets across China by August. 

Xiaomi is moving towards two distinct approaches by working on both a camera-based computer vision system and another advanced driver assistance system (ADAS) that relies on more sensors including lidar. The company said it will exclusively employ Nvidia’s cutting-edge chips for both systems and bring the software development completely in-house to ensure timely over-the-air updates across all its car variants. 

“In China, Tesla vehicles will not be as good as the SU7 when it comes to intelligent driving capabilities,” said Lei, adding that customers who placed their orders before the end of this year will get the software free of charge. Tesla currently charges Chinese buyers RMB 64,000 for future access to its full self-driving (FSD) package, despite it remaining unavailable in the country. Still, it is faced with competitors from BYD to Geely which also look to offer customers highly automated features with their premium EVs.

READ MORE: Key takeaways from Xiaomi’s EV pre-launch: A top offering facing a tough test

Alibaba’s logistics operation Cainiao will double employees’ annual bonuses next year after the company announced it was canceling its planned IPO in Hong Kong. Wan Lin, chief of Cainiao announced the annual bonus decision late Tuesday in a staff-facing email, shortly after Alibaba said it was abandoning the subsidiary’s anticipated IPO.

Why it matters: Alibaba’s offer to buy remaining Cainiao shares up to $3.75 billion and the bonus incentive plan should give a double boost to investors and staff amid the unexpected listing withdrawal. Cainiao’s public offering was originally expected to be the largest IPO in Hong Kong in 2023.

• The unit filed its A1 filing with the Hong Kong Stock Exchange on Sept. 26 last year. When Alibaba announced the withdrawal of the IPO plan this Tuesday, it coincided with the last day of the six-month window during which the company was obligated to update its listing status.

Details: As part of the new incentive plan, Cainiao employees will receive their standard year-end bonus in April 2025, with an additional bonus of the same amount in August 2025. This plan will cover all of the firm’s regular employees who are on duty and eligible for the year-end bonus at that time.

• This year marks a crucial period for Cainiao’s “second venture journey,” according to Wan, which he said will require all employees to continue to “work hard together,” without providing further details on what this journey may entail.
• Joe Tsai, chair of Cainiao’s parent company Alibaba, told analysts the IPO abandonment was an internal decision made after evaluating strategy; he emphasized that the call was made without any influence from regulatory authorities, given the infamous halting of Ant Financial’s IPO in 2020. He highlighted a deep integration between Cainiao and Alibaba’s e-commerce businesses as important to the retailer’s priority of “winning in e-commerce by regaining market share and driving growth.”
• Cainiao is closely entwined with Alibaba’s core e-commerce operations. For instance, its logistics arm launched same-day delivery services for Tmall Supermarket last year. In a competitive landscape where domestic logistics firms vie to be known for efficiency and service excellence, customers in over 20 cities can now expect to receive their purchased items within half a day after they place orders through the online supermarket.
• Cainiao also plays an important role in facilitating Alibaba’s international expansion efforts as cross-border platform AliExpress extends its reach to overseas customers rival to Shein and Temu. This has pushed Cainiao to expedite its delivery services accordingly. Shoppers across multiple overseas markets, including the US, the UK, and the Netherlands, can currently receive parcels from China within five working days via the service.

Context: Driven by income from cross-border fulfillment solutions, Cainiao’s 2023 fourth-quarter revenue grew 24% from a year earlier to $4 billion. The company’s adjusted earnings before interest, taxes, and amortization (EBITA) reached RMB 961 million ($135 million) during the period, a $550 million improvement compared to the previous quarter.

Chip giant TSMC is seeing increasing orders from its three major clients – Apple, Intel, and AMD – for its 3nm chips, according to Taiwanese media outlet Economic Daily News. TSMC launched its 3nm process in late 2022, but up until the fourth quarter of 2023, Apple was its only customer for the technology, as the foundry slowly ramped up its production. As that situation changes, TSMC’s revenue share from 3nm chips is expected to surpass 20% of its total this year, positioning them as the company’s second-largest revenue contributor after its 5nm chips according to the Economic Daily News report.

Why it matters: With orders for its 3nm chips from major clients continuing to rise, TSMC is expected to experience significant short-term revenue growth and cement its dominance in the advanced semiconductor manufacturing sector.

Details: The Economic Daily News has analyzed the order status of TSMC 3nm chips from three key clients: Apple, Intel, and AMD.

• The upcoming iPhone 16 series by Apple will feature the new A18 series processor, while its new Mac processor (the M4 series) is expected to launch in the first quarter of 2025. Both are 3nm chips scheduled for production by TSMC starting in the second quarter of this year.
• In the second quarter of 2024, Intel will start the mass production of Lunar Lake CPUs (central processing units), GPUs (graphics processing units), and high-speed Input/Output chips at TSMC. This marks the first time that Intel has outsourced its complete range of chips for mainstream consumer platforms to TSMC. The CPU/GPU cores may also adopt 3nm technology, representing a new source of orders for TSMC’s 3nm process this year.
• AMD this year will unveil its new Zen 5 architecture platform, which is expected to greatly enhance AI applications. The report suggests that AMD’s Zen 5 architecture utilizing TSMC’s 3nm process is scheduled for a release in the second half of 2024.
• In the fourth quarter of last year, TSMC’s revenue contribution from 3nm chips already rose to about 15%, driven by the order of the 3nm A17 Pro processor for the Apple iPhone 15 series, according to TSMC’s financial reports.

Context: TSMC has secured over 90% of the total global AI chip foundry orders, as tech giants such as Nvidia, Google, Intel, Qualcomm, Microsoft, and AMD compete fiercely in the AI chip market, Economic Daily News reported.

• Driven by the high demand for AI chips, the high utilization rates of advanced processes of 6nm, 5nm, 4nm, or 3nm will further improve TSMC’s performance, a company insider told Economic Daily News. TSMC’s revenue in 2024 may increase by 24% to 26% year-on-year, the source claimed.

China’s Zeekr and Xpeng Motors will begin delivering their electric vehicles to Thailand later this year while eyeing expansion to other Southeast Asian countries, as they seek further overseas growth amid slowing opportunities at home.

Why it matters: The news comes after Chinese car brands’ combined market share reportedly swelled by six points to 11% in Thailand in 2023, thanks to growing demand driven by favorable subsidies and tax breaks for EV purchases. 

• Southeast Asia’s largest car producer and exporter, Thailand has also become a strategic location for Chinese automakers wishing to diversify their operations and reduce geopolitical risks, according to researchers from the Global Policy Institute.  
• EVs accounted for around 10% of car sales in Thailand last year, and the government has aimed to increase that percentage to around 30% of its annual production of 2.5 million by 2030, making the country a regional manufacturing hub for EVs. 

Debut in Bangkok: Xpeng named on Monday three major dealer groups to sell and service its EVs for Southeast Asia: Neo Mobility Asia for Thailand, Premium Automobiles for Singapore, and Bermaz Auto for Malaysia. 

• The Volkswagen-backed EV maker announced the partnerships ahead of the opening of a major auto show in Bangkok, with plans to start delivering a right-hand drive version of its G6 crossover in the three countries in the third quarter of 2024. 
• In the meantime, Zeekr has put forward a similar timeline for its compact crossover X and multi-purpose vehicle 009, with plans to open its first store in Bangkok later this year. The company began Thai pre-sales on Monday. 
• The Geely-owned brand said it will expand its retail network with distributors in Chiang Mai, Phuket, and Pattaya by year-end. It has also signed contracts with car dealers in Laos, Myanmar, and the Philippines, Reuters reported on March 12. 

Local production ramp-up: Chinese automakers are making deeper inroads in Thailand by setting up plants in the country, as the Thai authorities required the firms to offset imports with local production at a ratio of 1:2 starting from 2026, in order to qualify for government subsidies. 

• BYD told investors last month that its $491 million car plant will begin operations in Rayong later this year, with an annual output of 150,000 units for both Thailand and the wider Southeast Asia region. The EV giant captured 4% of the country’s auto market with sales in 2023 of about 30,000 EVs. 
• Aion’s first overseas plant is set to begin production in July. The EV maker, an affiliate of China’s GAC Group, said on Jan. 31 (in Chinese) it will invest 2.3 billion baht ($63.2 million) in the project for an annual output of 50,000 units, not long after it started exports to the country in September. 
• Changan also hopes to begin exporting EVs from Thailand to nearby ASEAN countries and beyond next year, as it builds up capacity at a $241.7 million facility with a maximum output of 100,000 vehicles annually in Rayong. Rivals such as SAIC, Great Wall Motor, and Hozon Auto are also making their EVs locally. 

Baidu has reportedly won a deal to power iPhones and other Apple devices in China using its generative artificial intelligence, domestic media outlet China Star Market reported on Monday, citing unnamed sources familiar with the matter. The Apple tie-up is a potentially major boost to the Chinese search engine giant’s vision of extra AI-generated revenue. 

Why it matters: China’s regulations have pushed Western tech companies to fully comply with the country’s rules if they want to lure the Chinese market, and that benefits Baidu, which serves many of the functions that Google does in the US and Europe. Following the Beijing headquartered firm’s rapid rise to prominence in the early 2000s, it appears poised to gain a major advantage from restrictions on Google once more.

Details: Apple previously engaged in discussions with Alibaba and another unnamed Chinese AI company, according to the China Star Market report, before finally tapping Baidu as its partner for AI services for its upcoming iPhone 16.

• Spurred by the news, Baidu’s Hong Kong-traded stock quickly rose over 6% ahead of the lunch break on Monday, although these gains were erased by more than half by the market close.
• On Weibo, China’s X-like microblogging platform, opinion was divided regarding Baidu’s AI tech being integrated into Apple devices. While some said the news meant that their interest in purchasing a new iPhone was lost instantly, others claimed it showed how good Baidu’s technology is.
• Baidu didn’t immediately respond to a request for comment from TechNode.
• The Chinese launch of Samsung’s Galaxy S24 series integrated Baidu’s AI chatbot Ernie to power its AI features such as content summaries and translations, but the collaboration has drawn scorn on social media. The device’s “Circle to Search” function, which is supposed to give detailed information about a certain part of an image or video that users long-press and circle, has been the subject of repeated complaints from users.
• In one viral example, a user on the Instagram-like social platform Xiaohongshu shared a video where they take a landscape picture and circles a reef in the center of the photo.  Baidu’s Ernie-driven AI provides a shopping link from an e-commerce platform, while Samsung’s Hong Kong version – powered by Google – displays the exact location of the image.

Context: Beijing-based Baidu, seen as China’s AI leader, is among the companies hoping to turn the much-hyped technology into a fresh revenue engine. Its chief executive Robin Li has said that  generative AI could add several billion yuan in incremental revenue for the firm in 2024. In the fourth quarter, Baidu’s AI-related revenue stood at RMB 656 million ($91.0 million).

On Thursday evening, Apple CEO Tim Cook attended the grand opening of the Apple Shanghai Jing’an store and engaged with a crowd of Apple fans who had flocked to the downtown location. The retail store is the second-largest Apple Store worldwide and the largest in Asia. The Jing’an store’s opening was part of a two-day visit to Shanghai from Cook, which comes amid falling iPhone sales in China. 

Why it matters: Cook’s presence at the opening of the Shanghai store was intended to demonstrate the brand’s commitment to the China market.  The country also plays a crucial role in Apple’s supply chain and manufacturing operations.

Details: During his two days in Shanghai, Apple CEO Cook shared various PR activities on the Twitter-like social media platform Weibo, where “Tim Cook encounters actor Zheng Kai” trended as a hot topic on Wednesday. 

• Cook wrote on his Weibo post, “Nonghao Shanghai! [Nonghao is hello in Shanghainese] Spent the morning walking the Bund with Zheng Kai and enjoying a classic Shanghai breakfast. I’m always so happy to be back in this remarkable city.”
• Cook shared another photo on Weibo on Wednesday afternoon showing him being briefed on gaming products by Papergames staff and accompanied by Papergames CEO Yao Runhao. Known for mobile hits such as dress-up role-playing game Shining Nikki and female-centered romance game Mr. Love: Queen’s Choice, the company is a major developer on Apple’s App Store. 
• Later, Cook met with BYD CEO Wang Chuanfu at Apple’s Shanghai headquarters. During the visit, Apple suppliers BYD Electronics, Lens Technology, and Everwin Precision Technology exhibited advanced manufacturing technologies and manufactured components for Apple products. “BYD, Lens, and Everwin are great examples of companies who are pushing the boundaries of what’s possible every day and we’re excited for the opportunities ahead,” Cook said on Weibo.
• On Thursday morning, Cook visited Shanghai Jiao Tong University’s Xuhui campus to communicate with student programmers. He then posted about meeting winners of the App Contest and Swift Student Challenge, highlighting their use of coding to address challenges and preserve traditional culture. The Swift Student Challenge from Apple is an annual event that invites student developers to showcase their coding skills by utilizing Swift programming. The Swift Student Challenge 2024 introduces a new category to honor 50 outstanding winners who submit exceptional works, according to Apple.
• On Thursday evening, Cook opened the Shanghai Apple Jing’an store, as a crowd of customers gathered in front of the retail space, eager to be among the first to enter. With over 30 years of history in China, Apple has created over five million job opportunities through direct employment, supply chain business, and iOS app related businesses, according to data provided by the company to China Economic Weekly.

Context: In 2023, Apple achieved its highest-ever market share of 17.3% and secured the top spot in the Chinese smartphone market for the first time, according to market intelligence firm IDC. The report revealed that China’s smartphone shipments totaled 271.3 million units in 2023, a 5.0% year-on-year decline compared to 2022, marking the lowest volume in a decade due to sluggish economic recovery and weak consumer sentiment.

• However, in the first six weeks of 2024, China witnessed double-digit declines in smartphone sales for Apple, Oppo, and Vivo, according to Counterpoint Research. During these six weeks, Apple’s iPhone sales in China declined by 24% year-on-year, ranking fourth among Chinese smartphone suppliers.

Hong Kong will provide a subsidy of up to HK$ 200 million ($25.6 million) to China’s Hozon Auto, which could alleviate the financial pressure on the electric vehicle startup and facilitate its expansion in overseas markets. 

Why it matters: Hozon Auto is the latest mainland-headquartered company to establish a base in Hong Kong as China hopes to create a high-tech megalopolis in its southern Greater Bay Area to rival California’s Silicon Valley.

• The news comes just months after CATL, the world’s biggest EV battery maker and a backer of Hozon, announced plans to set up a research and development facility in Hong Kong as part of a $128 million investment plan to make the city its international headquarters. 
• Chinese auto tech unicorn Horizon Robotics has recently partnered with Hong Kong Science and Technology Parks Corporation (HKSTP) with plans to expand its local research team and invest a total of HK$ 3 billion in the territory by 2028, according to an announcement published in December. 

Details: In addition to providing a $25.6 million subsidy, the Hong Kong government will also “provide assistance” (our translation) for a $200 million cornerstone investment for Shanghai-based Hozon, the company said on Wednesday in a statement, without giving further details. 

• “Hong Kong serves as a super-connector and super value-adder […] for mainland Chinese companies willing to expand their global presence,” Hong Kong Chief Executive John Lee said on Wednesday at a signing ceremony attended by Hozon chairman Fang Yunzhou, the South China Morning Post reported. 
• Hozon had announced plans in August to locate its global headquarters in the Asian financial hub in a partnership with HKSTP while promising to invest RMB 3.2 billion ($444 million) and hire 600 research staff locally over the next few years. It is also looking into the possibility of operating a production plant in Hong Kong. 

Context: In December, Hozon forged a partnership with local dealership DCH Motors to begin selling Neta-branded EVs in Hong Kong in 2024 and began trial production at its first overseas car plant in Thailand, which has an output of up to 20,000 EVs annually. 

• The company has reportedly hired several major investment banks including Morgan Stanley for an initial public offering in Hong Kong that could raise to $1 billion, a development that took place soon after the firm secured RMB 7 billion in a funding round last summer.
• Hozon delivered roughly 127,500 EVs last year, representing a 16% decline compared with 2022 and around half of its sales target of at least 250,000 units, and has been offering a price cut of between RMB 8,000 and RMB 22,000 on its vehicle lineups since mid-February as competition heats up in the Chinese EV market. 

Alipay owner Ant Group has appointed current chief financial officer Han Xinyi as its new president, according to an internal email from chairman and CEO Eric Jing on Tuesday. The move is part of the firm’s biggest overhaul since the cancellation of its IPO in late 2020, with the fintech company also deciding to grant three of its units operational independence.

Why it matters: The restructuring is likely to grant more flexibility for businesses within the fintech affiliate universe of Alibaba and is intended to unleash their growth potential under Ant’s globalization strategy.

Details: The reshuffle is “just one of many” in Ant’s future growth, said Jing, adding that, “we will create an environment that encourages more emerging businesses, and creates greater value for society” (our translation).

• Ant International, commercial database OceanBase, and Ant Digital Technology, the three “innovative businesses” that will become independently operated subsidiaries, will set up their own board of directors and reduce their reliance on the group.
• According to a report by Chinese media outlet LatePost, Ant will continue to offer technology and capital support to the three independent units as they are still making a loss, but they are set to launch stock option plans separately in an effort to retain talent.

Context: On Nov. 3, 2020, two days before Jack Ma-founded Ant’s scheduled dual listing debut which was supposed to take place simultaneously in Hong Kong and Shanghai, the major IPO was surprisingly halted by China’s financial regulator. 

• The announcement from the Shanghai Stock Exchange at the time noted that the actual controller, chairman, and CEO of Ant were “called in for regulatory talks by relevant authorities,” which it said might lead to the firm “not meeting the conditions for issuance and listing or the disclosure requirements.”
• China’s primary financial regulatory bodies fined Ant Group and its subsidiaries RMB 71.23 billion last July, a hefty fine that was seen as marking the end of the authorities’ close scrutiny of the fintech giant.

China will stick to its plan of becoming an electric vehicle powerhouse on the world stage despite recent signs of weakness in the industry, and will fine-tune policies to deal with challenges including slowdowns and overcapacity, government officials said over the weekend. 

EV skepticism: The comments came after a slew of international carmakers, including Volkswagen, Mercedes-Benz, and Ford, moved to either cut production of electric models or delay their electrification goals as global demand growth fell short of their lofty expectations. Meanwhile, 2024 kicked off with a new round of price cuts in the Chinese auto market, putting loss-making EV makers under further pressure. 

• “It is untrue to claim vehicle electrification is a trap set by the West,” Ouyang Minggao, an academician at the Chinese Academy of Science, commented in response to doubts raised in the industry about the affordability and practicality of EVs at an annual forum organized by the EV100 think tank on March 16 (our translation). 
• Ouyang, also a vice chair leading the think tank and a standing committee member of the Chinese People’s Political Consultative Conference (CPPCC), said China‘s pursuit of new energy vehicles (NEVs) came after “great deliberation with due concern for oil security, air pollution, and industrial transformation,” according to a video clip seen by TechNode. 
• China could consider being more open to foreign companies, according to Ouyang, who proposed that the government should remove tariffs on EV imports, which could also help to offset geopolitical tensions. “We missed the opportunity to excel in making fossil-fuel cars, but I am confident about China becoming a powerhouse in the era of NEVs,” Ouyang added.

New measures: China will announce comprehensive measures in the coming days to boost domestic demand, facilitate consolidation in the industry, and broaden mass adoption for battery cars, according to several vice ministers who attended the forum. 

• China will enforce stricter oversight on the requirements pertaining to investments for manufacturing NEVs, curb blind expansion in NEV projects, and release specific guidance and regulation for merger and reorganization activities, said Shan Zhongde, a Deputy Minister of Industry and Information Technology. 
• The Commerce Ministry will look into the possibility of reducing insurance premiums on NEVs to help improve maintenance services and alleviate customers’ concerns, according to Vice Minister Sheng Qiuping. Meanwhile, Beijing will introduce new incentives to encourage buyers to trade in their old vehicles for greener ones, especially NEVs and hybrid vehicles. 
• The central government is also aiming to renovate 50,000 old urban residential communities this year, which will include the installation of public chargers for EVs, said Qin Haixiang, a Deputy Minister of Housing and Urban-Rural Development. The National Energy Administration will concurrently push for the sufficient availability of charging points in the country’s vast majority of rural areas, said director Du Zhongming. 

READ MORE: EV charging problems deepen as Chinese consumer confidence wavers: McKinsey

Rising PHEV usage: China expects the rising adoption of plug-in hybrid vehicles (PHEV) to offset the slowing growth of battery EVs in the short to medium term. BYD reported sales of roughly 1.57 and 1.44 million BEVs and PHEVs respectively last year, prompting a growing number of Chinese carmakers to follow suit in producing more of the battery EV alternatives. 

• Ouyang described the dual strategy of making both PHEVs and BEVs as “a wise move.” He expects PHEVs to grab significant market share from internal combustion engine cars in the coming years, especially in the price segment between RMB 70,000 and RMB 100,000 ($9,724 and $13,891), while envisioning a more widespread adoption of BEVs over the next decade.
• Sales of BEV and PHEVs in China rose 11.7% and 72.8% respectively in the first two months of this year, according to figures from the China Association of Auto Manufacturers (CAAM). Overall NEV sales increased 29.4% to 1.2 million over the period, and the industry group expects growth to further slow down to 21.1% in 2024 from last year, when the market grew by 37.9%. 

READ MORE: Chinese EV makers’ February sales hit by holiday, cold snaps

On March 15, the annual 315 Evening consumer rights TV broadcast co-hosted by state media China Central Television (CCTV) and a number of national government departments, exposed an illegal industrial chain producing motherboards for the mass manipulation of smartphones. In the undercover journalists’ secretly recorded footage, manufacturers boast that their motherboards can be used to assemble multiple smartphone mainboards, allowing one person to control multiple phones to perform identical operations on one computer. These motherboards are touted as being able to participate in and control all the network functions of the connected smartphones via the computer.

Why it matters: CCTV’s 315 show has been broadcast since 1991 and has regularly created headlines with its high profile investigations into companies undermining consumer rights. This latest scandal could have implications for China’s e-commerce, gaming, and social media sectors.

Details: According to CCTV’s exposé, specialized motherboard manufacturers assemble dozens of smartphone mainboards to integrate them into a single motherboard that can be controlled by connecting it to a computer, enabling a single user to control multiple devices, each with its own IP (Internet Protocol) address.

• “You can become a king of controlling everything in the online world,” a company executive told an undercover journalist at one point during the broadcast. Buyers can manipulate various IP addresses for purposes such as placing fake orders, posting fake comments or likes, and manipulating online voting through a large number of motherboard devices. 
• Undercover journalists discovered that clients using motherboard devices engage in various online activities, such as promoting advertisements, gaming and e-commerce related behavior, faking active interactions from different users in livestreaming rooms, and boosting traffic for certain public relations articles.
• The report also mentioned a company planning to build a facility with tens of thousands or more motherboards, which would equate to having hundreds of thousands of fake IP addresses.
• The price of the motherboard devices ranges from RMB 3,000 ($417) to RMB 6,000 ($834), with each set containing 20 smartphone mainboards. In the secretly recorded footage shown on CCTV, an employee of a motherboard manufacturer even invited the undercover journalist to experience the powerful device on-site.
• The customized version of the motherboard violates article 12 of the Anti-Unfair Competition Law of China, which states: “Business operators shall not use technical means to hinder or disrupt the normal operation of network products or services provided by other operators through influencing user choices.”
• The CCTV report mentioned three companies: Yunji Xia Technology, Shenzhen Yuncheng Future Technology, and Hunan Yundou Technology. The data agency Tianyancha indicates that 320 companies are currently engaged in motherboard production in China, according to a report by local media outlet Jiemian. In terms of regional distribution, Guangdong, Jiangsu, and Jiangxi have the highest concentration of companies related to motherboard business, with 230, 14, and 12 companies respectively.

Context: The 315 Evening this year also exposed a range of other illegal activities and disreputable business practices, including fire-resistant glass that isn’t fireproof, fire extinguishers that cannot put out fires, tainted preserved pork, deceptive practices on matchmaking platforms, unsettling sounds from BMW transmission shafts, and the installment of loan lending platform scams via gift cards. 

Details of new electric vehicle models from Chinese auto and tech majors including Huawei, Xiaomi, and Geely have been leaked online via an official regulatory process. Some are expected to make their debut at the upcoming Beijing Motor Show next month, positioned to compete with models from dominant rivals such as BYD and Tesla, and potentially stirring up a new price war in the world’s biggest auto market.

The companies expect the upcoming models, now making a splash online, to become bestselling or otherwise strategically important cars for their brands. Below are highlights from the registration filings released for public review by China’s Ministry of Industry and Information Technology (MIIT) on Tuesday, giving critical details of the models ahead of their official launches. 

Stelato S9

The S9 will be the first model under the new premium Stelato brand launched in partnership between Huawei and China’s BAIC and the largest sedan model of all Huawei-enabled EVs to date. The car measures 5.1 meters in length and 1.5 meters in height with a wheelbase of nearly 3.1 meters, offering passengers a spacious and comfortable interior in an effort to draw in affluent Chinese consumers. 

The all-electric executive sedan will be available in single and dual-motor variants producing 308 and 524 horsepower respectively, and will include innovative elements such as a camera-based digital rear-view mirror system as an optional add-on, according to the filings. Analysts expect the car to be launched in June for between RMB 300,000 and RMB 500,000 ($41,730-$69,550). Shares in partner BAIC Bluepark surged 32% on the mainland Chinese stock market on the news over the week. 

Zeekr Mix

China’s Geely is raising its bet on the small but growing segment of multi-purpose vehicles with its upcoming roll-out of the Zeek Mix, an all-electric five-seater van, after the launch of its larger and more business-oriented Zeekr 009 nearly two years ago. The pictures published by MIIT show a mid-size MPV with a rounded exterior and low center of gravity as well as an optionalLIDAR unit mounted on the car’s roof for automated driving. 

It is slightly shorter than the Zeekr 007 sedan at nearly 4.7 meters in length, likely making it easier to maneuver and attractive to parents, while offering a larger interior with a 3,008-millimeter-long wheelbase. The single-motor car has a 422-horsepower electric powertrain – higher than the plug-in hybrid Denza D9 from BYD, currently a top-seller in the market, but less powerful than bigger offerings such as the Xpeng X9 and the Li Auto Mega. 

Xiaomi SU7

Xiaomi on Wednesday received Chinese government approval for a new variant of its first EV, the long-anticipated SU7, equipped with lithium iron phosphate (LFP) batteries sourced from CATL and roughly 110 kilograms heavier than the one powered by BYD’s iron-based batteries. Speculation has circulated that the new power option could be CATL’s Shenxing batteries, which have boasted of a high energy density for a longer driving range and an 800-volt electrical system for faster charging compared with existing offerings. 

China’s industry regulator had previously uncovered details about another entry-level SU7 and the more premium SU7 Pro/Max, which the company claimed could accelerate from 0 to 100 km/h (62 mph) in 2.78 seconds and would be more aerodynamic than rivals’ offerings including Tesla’s Model S. Chief executive Lei Jun said on Friday that the smartphone maker will begin deliveries immediately on March 28, when pricing of the sports sedan will be finally announced.

READ MORE: Explainer: How a new round of price cuts are reshaping China’s EV market

TikTok’s efforts to continue operating in the US under Chinese parent company ByteDance appear doomed after a majority of House lawmakers passed a bill that aims to force the Beijing headquartered tech firm to divest from the wildly popular short video platform or see it removed from app stores in the country. The bill still needs to pass the Senate, but President Joe Biden has indicated he will sign it into law if it reaches his desk. 

The Republican-controlled House of Representatives voted 352-65 on the bill. Of the 65 legislators who voted against it, 50 were Democrats, casting some uncertainty on whether the bill will pass in the Democrat-majority Senate. The potential legislation is also likely to face legal challenges from TikTok.

Why it matters: If ByteDance agrees to sell TikTok, one of China’s most successful apps worldwide, it would bring the Beijing-based company billions of dollars in immediate income, but the longer-term impact on the firm’s value is uncertain. The tug-of-war over the app also reflects the high-profile tensions between the US and China.

Details: TikTok labeled the House’s voting process “secret” in a statement released after the result. The platform insisted on characterizing the bill as a “ban”, while emphasizing that it hosts 170 million users and 7 million small businesses in the US market in a post on X, formerly Twitter.

• Chinese nationalist Hu Xijin, who previously served as editor-in-chief of the state-run Global Times newspaper, said in a recent social media post that the US’s concern over TikTok’s threat to national security is “grossly exaggerated,” and that this is a fact “everyone in the world knows.” The commentator implored the short video app not to “get weak in the knees,” adding that it will share a bright future if it wins this “war.”
• The video-sharing platform sent local users in the US a pop-up notification last week encouraging them to call their political representatives and urge them to fight against the bill. The average TikTok user in the US is an adult “well past college age,” chief executive Shou Zi Chew revealed in his testimony on Capitol Hill last March.
• While Biden has shown broad support for the bill – despite his election campaign recently joining the platform – his rival in the upcoming US presidential election, Donald Trump, has made a U-turn on the legislation, voicing concerns that banning TikTok would only empower Facebook owner Meta. “There are a lot of young kids on TikTok who will go crazy without it,” Trump said in a recent CNBC interview, despite his administration also previously attempting to force ByteDance to sell the app.

Context: According to OpenSecrets, a nonprofit organization that tracks lobbying data, ByteDance spent a record $8.74 million on federal lobbying last year, nearly double its spending in 2022.

NetEase is expected to announce the return of Blizzard to the Chinese gaming market by late March or early April, sources have told local media outlet CoreEsports. The revival of NetEase and Blizzard’s relationship would be a remarkable turnaround after the World of Warcraft developer ended its long-running agreement with the Chinese gaming giant in January last year. The break-up of the two after 15 years working together resulted in acrimony and lawsuits, but they now seem set to repair relations and enter a new agreement.

Why it matters: The player base for Blizzard’s games in China is substantial, and with the added value of its gaming IP, NetEase stands a good chance of securing the rights to develop mobile versions of Blizzard’s titles if the pair resume collaboration.

Details: NetEase Games will manage operations for Blizzard’s games, while NetEase’s gaming subsidiary Leihuo Technology will handle the marketing, according to CoreEsports.

• The mobile version of Naraka：Bladepoint, developed by NetEase’s Leihuo 24 Entertainment, is scheduled for release on April 1, aligning closely with NetEase’s announcement of Blizzard’s return to Chinese servers, according to the report. This timing suggests the possibility of a coordinated marketing effort.
• As for the specific timing of Blizzard’s return, insiders suggest it will be synchronized with updates to World of Warcraft. In 2024, World of Warcraft has four major updates: version 10.2.5, version 10.2.7, the pre-11.0 version, and version 11.0. Based on this schedule, the earliest potential return of the game to Chinese servers could coincide with the rollout of the 10.2.7 update by the end of March, possibly on the same day as the launch of Naraka: Bladepoint on April 1.
• After the return of Blizzard, NetEase’s Leihuo may look to secure the IP rights for World of Warcraft and develop a new mobile version. NetEase has been eager to collaborate with Blizzard on mobile adaptations, with Diablo Immortal being their only joint venture currently available.
• NetEase will no longer establish a dedicated firm to manage Blizzard games but will integrate them into the NetEase Interactive Entertainment (another name for NetEase Games) operationally, in a similar fashion to other collaborative gaming titles at NetEase. Notably, Diablo Immortal, the sole ongoing collaborative project between the pair, is also developed by NetEase Interactive Entertainment’s Guangzhou team.

Context: On Jan. 24, 2023, Blizzard’s Chinese servers were shut down, marking the end of their 15-year partnership with NetEase Games in China. Last December, news of a potential revival of the cooperation between the two giants surprised many domestic gamers, given the previously sour ending to their relationship.

• Following the shutdown, an estimated three million players of World of Warcraft in China were deprived of access to a game many had enjoyed since childhood, according to US media outlet Rest of World. Additionally, over one million Chinese players sought refunds.

Baidu co-founder Robin Li has used the example of a Tang dynasty poetry meter to demonstrate what he says is ERNIE 4.0’s superiority to OpenAI’s GPT-4 on Chinese language tasks. In an interview broadcast by Chinese state television last week, the Baidu chief executive said the company’s latest AI chatbot had shown higher aptitude when tasked with creating poetry in the form of a complex Tang dynasty scheme known as Qinyuanchun.

“If I asked GPT to compose a poem following the Qinyuanchun scheme, the tool would become totally confused,” Li said, “because it lacks the understanding of whether the first sentence should consist of four words or five.”

Why it matters: Li’s attempt to emphasize ERNIE’s competitive advantage in certain areas follows a raft of Chinese AI ventures receiving outside capital injections from Baidu’s rivals. His comments also come as OpenAI’s text-to-video model Sora kicks off a new round of AI mania worldwide.

Details: In the same interview, the CEO did acknowledge that ERNIE lags “a little bit behind” GPT in understanding English, as it hasn’t been trained on as much English language data.

• However, comparison is inevitable, and Chinese companies focusing on AI products have always benchmarked their products against OpenAI’s models. Such comparisons have often drawn scorn on Chinese social media, with Baidu itself often suffering in comparison to ChatGPT’s innovative progress. But Li told the CCTV show that he is “not angry” about the stark differences between ChatGPT and his firm’s self-built chatbot, adding that he hopes to change people’s perceptions within a year.
• Li also stated that, in his opinion, the profession of “programmer” will essentially cease to exist in the future as “everyone will possess programming abilities as long as one can speak.” English and Chinese will be the only two programming languages, Li predicted.
• Li also advised companies and entrepreneurs in the market to avoid engaging in the constant launch of large language models, which he regards as “repetitive labor.” He emphasized that “only applications truly create direct value.”

Context: Baidu’s investment in AI has yielded results in its financial reports, with its AI models and ERNIE chatbot contributing RMB 656 million ($91.5 million) to the firm’s revenue in the fourth quarter last year. However,  such contributions amounted to just 1.9% of the company’s total earnings.

• Li was speaking ahead of the one year anniversary of Baidu’s ERNIEbot, which launched on March 16 2023.

Huawei and Chinese automaker BAIC are aiming for monthly sales of their first joint electric vehicle model under a new brand to exceed 10,000 units, as they also set their sights on markets in Asia and Europe, Chinese media has reported. 

Why it matters: The launch of the new car brand with BAIC, named Stelato and scheduled to be unveiled in April at this year’s Beijing Motor Show, would be another test for Huawei as the smartphone maker has been looking to grow its automotive business after being hit by US sanctions. 

• Huawei’s track record in EVs has so far been mixed. It has managed to bring the struggling Aito brand back to life with manufacturing partner Seres following the successful launch of the redesigned M7 plug-in hybrid crossover in September. However, the first Luxeed EV was a setback for the tech giant and its partner Chery, as buyers were confounded by delivery delays stretching for months. 

Details: Huawei and BAIC Bluepark, a mainland-listed subsidiary of the state-owned automaker, expect monthly sales of the first model under the new Stelato brand to achieve more than 10,000 units, according to an internal memo seen by Yicai (in Chinese). 

• According to the report, the executive sedan will be priced between RMB 300,000 and RMB 500,000 ($41,730-$69,550), and is scheduled to debut next month at this year’s Beijing Motor Show; it would then officially launch in June. 
• BAIC, a main partner of Daimler in China, is planning to create a capacity of around 300,000 EVs for the Stelato project, with more high-end EV models from sports sedans to SUVs in the pipeline, the report said. 
• The automaker last month told investors it is setting up a sales and service network for overseas markets, especially Europe and Asia. An existing partner to Huawei, BAIC sold fewer than 50,000 units of its Arcfox-branded EVs from 2021 to 2023. 
• Meanwhile, Huawei is set to launch its first model as part of a separate partnership with JAC Motor by the end of this year. The two companies plan to produce 35,000 units of the multi-purpose vehicle annually in a new plant scheduled for completion in 2025, according to an environmental filing published on March 1. 

Context: More Chinese automakers, such as state-owned Changan and Dongfeng, are joining Huawei’s expanding “Harmony Intelligent Mobility Alliance” in hopes of re-creating their brand images with Huawei’s smart cockpit and automated driving technologies, and leveraging its sales network.

• Aito for now remains the biggest success story of Huawei’s push into EVs, as vehicle deliveries grew 24% year-on-year to 94,380 units in 2023. Sales further increased to more than 54,000 units during the first two months of this year when most automakers reported flagging sales.

Chinese electric vehicle makers are taking a ferocious price war to a new level as BYD and its peers kicked off 2024 with dozens of redesigned models that boast improved specifications at lower price tags. 

For conventional carmakers, the situation is different from previous stages of the battle, as their Chinese counterparts claimed for the first time that “electric is cheaper than gas,” meaning their EVs now reach or even surpass price parity with similar combustion engine models. This milestone was supposed to take place as early as 2026, according to forecasts from BloombergNEF. Its ahead-of-schedule arrival is ushering a new phase for China’s car industry.

The world’s biggest EV market is being reshaped by a seemingly endless price war that has been going on for a year, and 2024 will likely be a defining moment for those faced with flagging sales, persistent losses, and cash flow pressure, analysts say. The following explainer looks at the causes and implications associated with the recent price cuts by automakers in China, as well as what we might expect in the future. 

The good: reduced costs, innovation

Among the key reasons for the price reductions is the plunging cost of raw materials for EV batteries, as the spot price of battery-grade lithium carbonate fell from more than RMB 500,000 ($69,450) per ton to just over RMB 100,000 throughout the last year. Jefferies analysts calculated that Chinese EV makers saw their gross profit margin recover by 2.3% in the third quarter of 2023 with average lithium prices falling by RMB 200,000. 

A vertically integrated supply chain stretching from batteries to chips has also granted EV leaders BYD and Tesla the ability to achieve economies of scale and innovate products rapidly. BYD, which has had strong “pricing power” especially in the price segment between RMB 100,000 and RMB 200,000, will embrace a proactive approach to competition, chairman Wang Chuanfu told investors during an earnings call last March (our translation). 

Analysts expect the downward trend in lithium prices to continue, as vast amounts of capital were poured into new mines in China following the price rise in 2022, resulting in a severely imbalanced market. Lithium prices could come in as low as RMB 90,000 a ton in the fourth quarter of this year, creating more room for most companies to make price adjustments, Jefferies strategists said in a Jan. 10 note. Meanwhile, EV makers such as Xpeng Motors are likely to improve vehicle margins “to some extent” thanks to innovations in fields such as automated driving. 

The bad: overcapacity, slowing growth

On the other hand, however, Chinese EV makers have been under pressure to boost sales volumes as they grapple with a clear capacity glut and slowing growth against the backdrop of weak momentum and insufficient demand. 

Only 20 out of 77 car manufacturers in China ran at more than 60% of their maximum operating capacity last year with numbers from the rest coming in under industry-competitive levels, according to public records. Tina Zhou, chief executive of auto parts trading platform Gasgoo, commented on social media on Dec. 17, citing this overcapacity as a major reason for the industry-wide price war over the past year. In January, the Chinese government said it would take “forceful measures to prevent superfluous projects” related to EV manufacturing, Reuters reported. 

Although China’s leadership in EV is seen as a bright spot in a faltering global economy and amid a domestic economic downturn, experts have painted a picture of a resilient but slowing market, flagging more price cuts to come as sluggish consumption abounds. Bernstein expects China’s EV sales growth to be “still impressive” but slower at 25% for 2024 compared to 35% last year, with a combined total of approximately 185 new EV models set to go on sale this year. 

“Consumers are getting spoiled by deep discounts and believe they will eventually negotiate a better price even for those new cars coming to the market,” Bernstein analysts wrote in a Jan. 10 note. 

Could it get ugly?

The unprecedented battle for the world’s biggest and most competitive EV market has pressured international auto majors from Ford to Toyota to scale back their operations since last year, with their market share (Tesla excluded) declining from 51.6% to 38.3% during 2021-2023. Citic Securities on Feb. 22 forecast (in Chinese) that number to drop to below 20% over the long term, with only German luxury carmakers able to maintain their presence. 

Meanwhile, a new wave of consolidation and some reshuffling is underway among Chinese EV makers as repeated price cuts allow the bigger ones to grab more market share and put their smaller rivals under financial pressure. The top 10 players could together claim a combined 85% of the market in 2024, driving smaller players out of business, Changan Automobile chairman Zhu Huarong, a delegate of the National People’s Congress, told Chinese reporters on Tuesday on the sidelines of the Two Sessions meetings in Beijing.

Not everyone agrees. NIO founder and chief executive William Li told TechNode during a media event in December that the company is preparing for a long drawn-out fight, while UBS envisioned China could be big enough to allow 10-12 domestic carmakers to sell significant volumes with different success stories by 2030 in the best-case scenario. 

Either way, it could be an almighty battle – it will be thrilling to see who emerges victorious.

Semiconductor giant TSMC has revealed that subsidies obtained from the Japanese and Chinese governments reached NT$47.545 billion ($1.51 billion) in 2023, marking a 5.74-fold increase year-on-year, according to Taiwanese media outlet Economic Daily News. With its ongoing expansion of overseas facilities, TSMC anticipates further subsidies from Japan this year, along with potential new subsidies from the US and Germany.

Why it matters: As nations compete to enhance their domestic semiconductor manufacturing sectors via subsidies, TSMC has become a key target for government investment in local facilities.

Details: In 2023, TSMC’s Japanese subsidiary JASM and its mainland Chinese counterpart in Nanjing secured subsidies from the respective governments of Japan and China, which primarily for real estate, building factories, purchasing equipment, and funding production facility costs.

• In 2022, subsidies from the Japanese and Chinese governments reached around NT$7.051 billion ($220 million), soaring 574% to NT$47.545 billion ($1.51 billion) in 2023. Although TSMC did not specify the exact breakdown of the subsidies, previous data indicates that the Japanese government decided to grant TSMC’s Kumamoto Fab 1 JPY 476 billion ($3.2 billion) in phased subsidies, as reported by Chinese media outlet Icsmart. 
• TSMC’s 2023 subsidies from mainland China primarily originated from the expansion project at its Nanjing plant, the Icsmart report added. In April 2021, TSMC announced a plan to invest $2.88 billion in expanding its 28nm process manufacturing at the Nanjing facility, to meet a rising demand for automotive chips and the global chip shortage.
• TSMC is currently investing $40 billion to construct a semiconductor fab in Arizona, with plans to manufacture 4nm and 3nm chips. A recent Bloomberg report suggests that Intel may receive around $10 billion in subsidies under the US’s CHIPS Act. According to analysis by Icsmart, using Intel’s investment and estimated subsidy amount as a reference point, TSMC could potentially receive nearly $10 billion in subsidies as well.
• TSMC is also collaborating with Infineon, NXP Semiconductors, and Bosch to invest €10 billion in constructing a semiconductor factory in Dresden, a city in eastern Germany. The German government is also expected to give about €5 billion in subsidies, according to news agency Focus Taiwan.

Context：TSMC’s Kumamoto Fab 1 started operations on Feb. 24 and is aiming to mass-produce 28/16/12nm chips in the fourth quarter of 2024. By the end of this year, TSMC plans to establish a second fab in Kumamoto, targeting production by late 2027, with a focus on 7/6nm processes.

• After the opening ceremony of Kumamoto Fab 1, Japan’s Minister of Economy, Trade and Industry, Ken Saito, announced that the government will subsidize TSMC with JPY 732 billion ($4.94 billion) for the construction of Kumamoto Fab 2 on the site.

Alibaba is reportedly joining as a lead investor in the latest funding round for Chinese AI startup MiniMax, the second major investment deal that the e-commerce giant has made in the emerging sector in 2024.

China Star Market, the local media outlet that first reported the news, noted that the financing has yet to be finalized, while a Tuesday report by Bloomberg said that Shanghai-based MiniMax is seeking at least $600 million.

Why it matters: Despite Alibaba’s cloud computing department’s focus on its own large language model, Tongyi Qianwen, the company remains actively engaged with external investments, casting a wide net as it looks to increase its bets on potential leaders in the country’s artificial intelligence sector.

Details: Minimax, founded by former vice president of SenseTime Yan Junjie in December 2021, has already launched services akin to ChatGPT. It also provides various LLM capabilities for Chinese word processing software WPS and the lifestyle-sharing platform Xiaohongshu.

• The move comes after Alibaba led fundraising for Moonshot AI earlier this year, raising over $1 billion and making it the latest AI unicorn in China. In the record funding deal for Moonshot AI, Alibaba not only supported most of the funding but also contributed through computing power services. This move echoes Microsoft’s investment in OpenAI, where a significant portion was allocated through cloud computing services, according to CNBC.
• Two of China’s leading artificial intelligence startups – Zhipu AI and Sogou founder-built Baichuan AI – also received funding from Alibaba in 2023. 

Context: “Artificial intelligence” was mentioned three times in this year’s government work report, delivered by China’s Premier Li Qiang on Tuesday. Li highlighted ongoing innovations in the field since 2023, while also stressing the need to “deepen research and development applications of artificial intelligence” this year, signaling the Chinese leadership’s desire to accelerate the development of “new productivity”.

• Representatives from the technology sector also discussed AI in their proposals for the so-called Two Sessions, the Chinese government’s annual plenary meetings. For instance, Lei Jun, Chairman and CEO of Xiaomi, suggested integrating AI literacy education into the nine-year compulsory education curriculum and introducing AI general education courses.

The latest data from Steam‘s monthly hardware and software survey has revealed that Simplified Chinese has become the primary language on the gaming platform, accounting for 32.84% of players in February. The shift may be attributed to a substantial increase in Chinese gamers taking to the site during China’s Lunar New Year holiday (Feb. 9 – Feb. 16). 

Why it matters: The language trend reflects the growing influence of Simplified Chinese-reading players within the Steam community, and highlights strong demand for the Steam platform and PC games in the Chinese market.

Details: Steam conducts a monthly optional and anonymous survey to gather data on the computer hardware and software utilized by its customers. This information aids the platform in determining investment priorities for developing new technologies and offering products. In February, the top five most commonly used languages among Steam players based on this survey were Simplified Chinese at 32.84%, English at 32.12%, Russian at 9.27%, Spanish at 4.10%, and Portuguese at 3.45%. 

• This language ranking marks the second time Simplified Chinese has topped the charts, with the first instance dating back to the popularity of the multiplayer online battle royale game PlayerUnknown’s Battlegrounds in 2017, when Simplified Chinese players accounted for over 60% of Steam’s user base, according to local media outlet IThome.
• Operating system: Windows 10 remains the most widely used system among Steam users, accounting for a significant 54.19%. Despite the release of Windows 11 in October 2021, players may be choosing to continue using Windows 10 due to considerations of stability and compatibility.
• Hardware configuration: 49.04% of players’ computers have 16GB of system memory, making this the most prevalent setup. As gaming hardware demands rise, 16GB of memory has become the standard for ensuring smooth gameplay across a majority of gaming titles.
• Display resolution: The majority of players, some 58.82%, prefer a resolution of 1920 x 1080. This data indicates that 1080p remains the mainstream choice for gamers, despite the gradual popularity of 4K resolution. For most players, 1080p offers a more cost-effective option.
• Graphics card: The RTX 3060 has become the most widely used graphics card with a 6% share, suggesting the widespread popularity of Nvidia’s RTX30 series graphics cards due to their performance and ray-tracing technology.

Context: The US currently leads in the number of Steam users, with 13.7 million people using the platform to share and play games, while China follows closely as the second-highest user base, with 11.4 million users, according to World Population Review.

• The most played Steam games of 2023 (where the peak player count exceeded 300,000) include titles such as Apex Legends, Baldur’s Gate 3, Counter-Strike 2, Destiny 2, Dota 2, Goose Goose Duck, Hogwarts Legacy, Lost Ark, PUBG: Battlegrounds, Sons Of The Forest, and Starfield. While not exclusively a Chinese game, PUBG: Battlegrounds was published and distributed in China by Tencent Games.

Sales of major Chinese electric vehicle makers including BYD and Geely fell by nearly half in February from a month prior, hit by the week-long Chinese New Year holiday and a prolonged cold snap, as well as ongoing economic uncertainty. 

Why it matters: The slump largely reflects the increasingly fragile position of smaller EV makers, already struggling to maintain reasonable sales volumes while larger rivals compete for market share with new models on offer for lower prices. 

• Consolidation within the world’s biggest EV market is expected to accelerate as competition intensifies and growth slows. Li Auto president Ma Donghui told investors last week that the top three brands could together claim 70% of the segment in which an EV is priced from RMB 200,000 ($27,780) by the end of this year. 

Details: BYD on March 1 reported its lowest sales since June 2022, with 122,311 vehicles sold last month, a 39.2% fall from January. New energy vehicle (NEV) sales of rival Geely, including battery EVs and plug-in hybrids, dropped 49% month-on-month to 33,508 units. 

• Great Wall Motor saw a bigger decline from a month earlier than its rivals as the auto major sold 12,253 EVs in February, a drop of 51%, while sales of Aion, a subsidiary of China’s GAC Group, were 33.2% lower than a month before. 
• Jefferies analysts attributed the decline to a seasonal demand lull in the just past Lunar New Year holiday, which reduced working days and dampened buying interest, accompanied by an unexpected cold snap that swept through most of China. 
• Smaller EV makers were hit harder than large ones, as monthly sales of both Leapmotor and Hozon Auto fell below 7,000 units, while February deliveries of Xpeng Motors and Voyah were down roughly half to 4,545 and 3,182 units respectively. 
• Most automakers have either launched cheaper new models or offered big incentives to drive sales in recent weeks. BYD kicked off 2024 with the launch of at least eight lower-cost version cars over the past two weeks, forcing rivals including Geely, Changan, and Leapmotor to follow suit.
• Huawei-backed EV maker Aito and Nasdaq-listed Li Auto, are among few carmakers to enter 2024 in decent shape, each delivering over 20,000 units last month. General Motors’ joint venture Wuling and NIO saw deliveries drop 18.4% and 19.1% from January respectively. 

Context: Analysts expected NEV sales to bounce back in March following recent price cuts by China’s major automakers, as store traffic returns to pre-Lunar New Year levels, according to a March 1 note from Jefferies, citing a Chinese dealership. 

• Overall, NEV sales in China declined 29.5% month-on-month to roughly 668,000 units in January, in part due to a high base in December when most automakers made a year-end sales push, according to figures from the China Passenger Car Association. 
• The industry group warned that numbers would drop in February to their lowest level of the year as the market entered a traditionally low season. It remains to be seen whether March will witness a sales rebound.

Situated in Barcelona, the Mobile World Congress (MWC) 2024 saw Chinese tech companies such as Lenovo and Tecno presenting their latest products from February 26 to 29.

Why it matters: The Mobile World Congress is one of the largest gatherings in the mobile technology sector, attracting industry leaders, professionals, and enthusiasts from around the world. Chinese tech companies often use the event as an opportunity to showcase their new innovations, products, and technologies. 

Details: Below are some of the most compelling new products spotlighted at the four-day exhibition by Lenovo and Tecno, two of the main Chinese firms in attendance.

• Chinese PC giant Lenovo and American electronics manufacturer Motorola co-showcased a concept wrap phone with a flexible screen that users can bend to wear on their wrist. The prototype phone features AI scene recognition capability, which adjusts screen size, recommends applications based on different scenarios and phone bending, and supports automatic phone wallpaper changes according to the user’s outfits.

• Lenovo also introduced the ThinkBook Transparent Display Laptop Concept, the world’s first laptop with a 17.3-inch Micro-LED transparent display. The device features a borderless screen, transparent keyboard area, and a seemingly floating touchpad design. By utilizing AI technology, transparent screens can integrate physical objects with digital information, allowing devices to naturally blend into their surroundings. The display provides a transparency of up to 55% when its pixels are turned off and set to black. As the pixels light up, the transparency gradually decreases and the display appears as an opaque white surface with a peak brightness of 1,000 nits.

• Chinese phone brand Tecno, a subsidiary of Transsion, unveiled an AI-enhanced quadruped robot dog, the Dynamic 1. The dog is inspired by the German shepherd and is able to climb stairs, bow, and extend its paw for handshakes, similar to a real dog. With four microphones and AI algorithms in its head, the robot dog recognizes audio commands for user interaction akin to traditional pets. Tecno envisions its utility in entertainment, assistance, education, and training, declaring it the ideal companion of the future. 

• The Tecno Dynamic 1 features an 8-core ARM CPU powering its AI system, HyperSense Fusion, which corrects its movements during operation. It also includes an Intel RealSense S430 depth camera and dual optical infrared sensors for obstacle recognition and fall recovery.

Context: MWC 2024 hosted around 2,400 exhibitors and 1,100 speakers, with nearly 300 Chinese companies in attendance, according to Chinese state media Xinhua News Agency. 

• Themed around Future First, this year’s MWC focused on the integration of AI across devices and networks, advances in 5G and 6G technologies, and the improvement of connectivity. GSMA, the event organizer, anticipated about 95,000 attendees from various parts of the globe at the Barcelona venue this year.

A 48% drop in net profit from a year earlier overshadowed Baidu’s record revenue in the fourth quarter of 2023, which was led by advertising income, but also featured a minor contribution from earnings related to artificial intelligence. Baidu’s Hong Kong-traded stocks have plunged nearly 30% since last July.

Why it matters: A 6% year-on-year increase in advertising revenue is the main driver of the search engine giant’s revenue growth, as Baidu’s hopes that AI will serve as a significant revenue stream remain unconvincing to investors, in contrast to US tech firms that saw a share uptick based on an AI boom last year. 

Details: Baidu’s AI model and ERNIE chatbot added RMB 656 million ($91.2 million) to revenue in the fourth quarter of 2023, CEO Robin Li told investors on the firm’s earnings call, with incremental revenue expected to jump to several billion yuan in 2024.

• Li revealed that inference costs for the basic free-to-use ERNIE Bot 3.5, used to analyze how much computing is needed to generate output based on prompts,  are down 99% compared to last March. 
• ERNIE Bot 4.0, the paid version rolled out in October, remains Baidu’s most advanced generative AI bot. The chips Baidu has on hand are expected to advance the flagship bot to the “next level,” said Li.
• Baidu’s increased investment in and commitment to AI is also reflected in the fact that its R&D costs climbed 11% to RMB 6.3 billion last quarter. The company released data showing that its homegrown AI service has attracted a sizable number of business customers, reaching 26,000 as of December.

Context: Baidu’s ChatGPT-style service has recorded more than 100 million users given its first-mover advantage and integration with China’s largest search engine,. But competition has increased, as Baidu’s tech counterparts in the country have also bet strongly on generative AI and there are an increasing number of AI startups that have received large amounts of funding from its rivals, such as Moonshot AI.

Chinese electric vehicle maker Zeekr began selling a redesigned version of its best-selling 001 on Tuesday with a slew of performance features including an extended driving range and faster charging speed at a cost of RMB 269,000 ($37,364).

Geely Automobile’s Zeekr is strengthening its offerings with an enhanced advanced driver assistance system, or ADAS, which will enable hands-free driving functions on Chinese motorways, in the face of competition from Tesla and home rivals such as Xpeng, Huawei, and Xiaomi. 

Why it matters: The new 001 is the latest example of how Chinese automakers are stepping up a months-long price war by offering ever-increasing high-tech, luxury-style features for the same price or less, as the world’s largest EV market consolidates.

• The Zeekr 001’s first full model change in three years, with more than half of the components refreshed or replaced, has pushed costs up by RMB 50,000 per unit, but the company has kept the starting price the same. The automaker cut prices of the model by around 10% from its original price in August 2023. The Zeekr 001 accounted for 60% of the brand’s sales last year.

Range boost: At a press event at Zeekr’s headquarters in Hangzhou, company officials emphasized how the all-new 001 beats rivals with its large battery packs and high-voltage architecture, providing more range and allowing for faster charging. 

• Zeekr offers two standard versions of the revamped 001. A rear-wheel drive model is powered by a 100 kilowatt-hour (kWh) Qilin battery pack which provides a driving range of 750 kilometers (466 miles) between charges, while an all-wheel drive variant can reach 675 km on a single charge with 95 kWh Shenxing batteries. 
• Both battery types, sourced from CATL, boast an extremely fast charge. Owners can add 525 km of range in 15 minutes with the Qilin batteries which charge at a 4C rate. The latest-gen Shenxing supports vehicles to run 256 km after a five minute charge at a 5C charge rate and needs 30 minutes to go from 10% to 80% at a temperature of minus 10 degrees Celsius.

Self-driving improvement: Zeekr integrated the revamp with roof-top lidar as standard, along with high-definition cameras and ultrasonic radar sensors around its perimeter, allowing the vehicle to spot objects 200 meters away, a combination intended to avoid complex situations and possible collisions. 

• The sports wagons will feature an upgraded version of a feature called Navigation Zeekr Pilot (NZP), which would take over basically all driving functions on the motorway, such as changing lanes and overtaking cars, according to the company. It is set to be available to drivers in 60 major Chinese cities by March and 90% of the country by June. 
• Zeekr expects to start inviting drivers to beta test a more advanced version of the ADAS software by June, allowing them to navigate around complex city streets without moving the steering themselves. The EV maker has embarked on a hiring spree for advanced driving with plans to increase the unit’s headcount from 800 to 2,000 by year-end. 

Market outlook: Management expects the all-new Zeekr 001 to contribute at least half of its sales in 2024, with monthly deliveries reaching 10,000 units per month, Jason Lin, a vice president, told reporters on Tuesday. The company will commence delivery on Friday with a goal to deliver 230,000 EVs this year, nearly a 100% increase from last year, Reuters reported. 

• The battery EV competes with crossovers and sports sedans such as BYD’s Denza N7, as well as the upcoming Xiaomi SU7. Rivals from BYD to Great Wall Motor have been ramping up efforts to develop self-driving technology, a drive that has been led by Huawei and Xpeng in China. 
• Lin was bullish on the firm’s outlook, adding that the company will expand its retail network to 525 shops by year-end, adding 100 or so flagship showrooms in first- and second-tier cities and another 100 smaller ones in lower-tier cities. Zeekr currently has four models on sale, including the cheaper sedan 007, the multi-purpose van 009, and a compact crossover.

READ MORE: Geely to sell its Zeekr electric cars directly to customers

TSMC’s first Japanese plant began operations in the southern prefecture of Kumamoto on Feb. 24, as the company confirmed plans for a second factory in the country within the year. TSMC’s 92-year-old founder, Morris Chang, attended the opening ceremony in Kumamoto, and Japan’s Prime Minister Fumio Kishida sent a congratulatory video message.

Why it matters: TSMC’s decision to build factories in Japan was hastened by incentives provided by the Japanese government, aiming to accelerate the growth of the local semiconductor industry by fostering collaborations with international foundries. Additionally, TSMC was enticed by Japan’s abundance of water resources and concentration of related tech companies that the firm needs to thrive in the sector, as suggested by industry analysis.

Details: TSMC founder Morris Chang, Chairman Mark Liu, CEO C.C. Wei, and other senior executives attended the opening ceremony of its majority-owned subsidiary JASM (Japan Advanced Semiconductor Manufacturing), according to a company announcement.

• Japan’s Prime Minister Kishida said in his video message broadcast at the event that the Japanese government has chosen to support the expansion of JASM in the context of the Domestic Investment Promotion Package announced in December 2023. Other distinguished attendees included Japanese Minister of Economy, Trade and Industry Ken Saito, and Chairman of the Liberal Democratic Party’s group on semiconductor strategy Akira Amari.
• Representatives from key partners such as Sony CEO Kenichiro Yoshida, Denso President Shinnosuke Hayashi, Toyota Chairman Akio Toyoda, and Kajima President Hiromasa Amano also leant their support to the chip-maker’s Japanese subsidiary by attending the factory opening.
• In his speech, TSMC founder Morris Chang recalled being invited to establish the chip factory in Japan back in 2019. Five years later, he said, the factory was a reality, with JASM expected to enhance the resilience of the chip supply chain and contribute to the revitalization of the local semiconductor industry, he said.
• The first plant, backed by a JPY 476 billion ($3.16 billion) subsidy from the Japanese government, will produce chips using 28/16/12-nanometer processes, while the second plant will specialize in 7/6-nanometer processes, according to Taiwanese media outlet Economic Daily News. JASM is expected to start construction of the second plant by the end of this year and be making chips there from the end of 2027.
• TSMC claims that the Japanese government’s investment in JASM will surpass $20 billion, and the establishment of the two fabs will provide at least 3,400 jobs.

Context: Sony, Denso, and Toyota also invested in JASM. Building of the first plant in Kumamoto began in April 2022, as reported by the media outlet Jiwei. 

• TSMC holds around a 70% stake in JASM, with Sony, Denso and Toyota as secondary investors. The plant expects to ramp up to a planned monthly production capacity of 55,000 12-inch chips.

Alipay hired a significant number of staff with expertise in advertising last year as it seeks a shift away from being a pure payment tool, according to a report by China Entrepreneur. Despite having over 700 million monthly active users, the payment app lacks the features to entice its huge user base to stay on the platform beyond making transactions.

Why it matters: Developing a sustainable content ecology based on short videos, livestreaming, and social engagement would pave the way to new revenue streams for Alipay.

Details: Alipay is reportedly beta testing a social feature called “Community of Interest”, where users with shared interests, ranging from camping, coffee, and hiking to fishing, can join groups to discuss or organize offline activities.

• This year marks the ninth anniversary of Alipay’s “Collect Wufu” (five kinds of fortune cards) campaign, a “digital temple fair” where users attempt to collect all five different fortune cards to share in a total of RMB 500 million worth of cash bonuses. Typically, participants receive anywhere from RMB 2 to RMB 3 each. 
• The platform boosted cash incentives during the recent nationwide Spring Festival holiday, adding an extra RMB 300 million to reward users for watching short videos and livestreams within Alipay while also pouring more than RMB 25 million into rewards for high-quality content creators, the company said in a statement.
• Neither Alipay nor third-party database platforms announced the app’s per usage hours during the eight-day Chinese New Year holiday period. However, according to data from the Ministry of Industry and Information Technology (MIIT), Alipay didn’t make the list of the top five most-used apps during the break, which comprised Douyin, WeChat, Kuaishou, Tencent Video, and news aggregator Jinri Toutiao.
• According to a report by QuestMobile, Alipay’s average daily usage per person only hit 7.8 minutes during the seven-day Spring Festival holiday in 2023.
• Taobao and Alipay are no longer as tightly bound as they once were, another reason Alipay needs to shift quickly to accelerate traffic monetization. It was reported recently that Alibaba’s e-commerce marketplace is gradually introducing an option to pay using rival platform WeChat, something it has long resisted.

Context: WeChat and Alipay were level in 2021 in terms of usage by mobile payment customers, but in 2022, WeChat took a 2.6% larger share of the market after expanding its range of payment scenarios, the latest figure from China’s payment & clearing industry association showed. 

On Thursday, Huawei launched the Huawei Pocket 2, a sleek flip foldable phone seemingly targeted at a young, predominantly female demographic, hitting the shelves after a 16-month gap since the previous generation. The Pocket 2 stands out as the industry’s first foldable flagship to support messaging via China’s Beidou satellite, facilitating communication in regions lacking ground network signal. The device also represents Huawei’s first foldable device equipped with its self-developed Kirin chipset.

Why it matters: Foldable smartphones, an emerging product range in the smartphone industry, have huge market potential in the Chinese market compared to traditional models – although overall phone shipments in China saw a decline in 2023, the foldable category experienced a sharp rise in sales.

Details: Alongside two-way satellite messaging through the Beidou satellite, Huawei claims the Pocket 2 is the world’s first flip foldable smartphone with four cameras on its cover and featuring a self-developed rocket-steel material water-drop hinge.

• The Pocket 2 is equipped with Huawei’s Kirin 9000S chip, a 7nm processor also featured in the company’s latest flagship phones. Paired with 12GB of RAM, it offers storage options ranging from 256GB to 1TB.
• The Pocket 2 boasts a Xuanwu water-drop hinge, which increases its flatness by 62%, and a double-arm lever gear that enhances support force by 41%, according to the company. Huawei states that the rocket-steel design improves drop resistance by 112%.
• Huawei has equipped the interior with a 6.94-inch foldable OLED screen, while the cover features a 1.15-inch circular screen positioned next to the camera island. The 6.94-inch OLED screen offers a resolution of 2,690 x 1,136 pixels and a variable refresh rate from 1Hz to 120Hz, delivering a peak brightness of 2,200 nits.
• The imaging system includes a 50MP main camera (with f/1.6 aperture, OIS), a 12MP ultra-wide macro lens (with f/2.2 aperture), an 8MP periscope telephoto camera (with 3x optical zoom, f/2.4 aperture), and a hyperspectral camera that can detect ultraviolet intensity to provide suggestions on sunscreen protection.
• The Huawei Pocket 2 is available in four color variants: gray, white, purple, and black. The flip phone starts from RMB 7,499 ($1,042) for the standard 256GB model, while the 512GB and 1TB models cost RMB 7,999 ($1,112) and RMB 8,999 ($1,251) respectively.

Context: Chinese consumers are increasingly inclined to try foldable smartphones as related technologies mature and prices become more affordable. 

• In 2023, foldable smartphone shipments in China reached around 7 million units, reflecting a year-on-year growth of 114.5%, according to market intelligence firm IDC. Huawei took the top spot in the domestic foldable market last year with a market share of 37.4%, while Oppo secured second place with an 18.3% market share.

The European Commission has opened a formal investigation into TikTok to assess potential violations of the Digital Services Act (DSA). Companies found in breach of the act could face fines of up to 6% of their global revenue.

Launched on Monday, the investigation into the Chinese-owned platform will involve looking at various aspects of TikTok’s operations including safeguarding of minors, ensuring advertising transparency, facilitating access to data for researchers, and managing the risks associated with addictive and harmful content.

Why it matters: The move extends the EU’s investigation of the ByteDance-led video-sharing app from previous concerns regarding its handling of disinformation related to content around Hamas and its management of children’s accounts, and intensifies the company’s immediate need to address the escalating scrutiny of major tech firms by the EU.

Details: TikTok was defined as a Very Large Online Platform (VLOP) by the European Commission under the DSA in April 2023, following its announcement of 135.9 million monthly active users in the EU.

• The European Commission believes that TikTok’s algorithms in the EU are designed to induce a “rabbit hole effect” on users, referring to the tendency of users to become immersed in online content and potentially distance themselves from real-life experiences.
• In response, TikTok said it will continue to work with experts and the industry to ensure young people are safe on its platform and that it looks forward to explaining this work in detail to the European Commission.
• The investigation comes just days after the short video app lost a court battle to suspend its designation as a gatekeeper, which requires companies with significant economic power and market influence to comply with a series of regulations under EU rules in the areas of advertising, user data, and intermediary services.

Context: In 2023, the Douyin sister app was fined €345 million in Ireland and £12.7 million in the UK by local regulators, who cited violations of the law in the platform’s handling of children’s account data.

On Feb.18, Wang Hua, Xiaomi’s public relations manager, declared on the Twitter-like social media platform Weibo that the company does not intend to implement any mass layoffs but is focused on routine personnel adjustments aligned with annual performance evaluations. Wang’s statement followed reports that the company was considering substantial layoffs by the end of February, providing an N+1 compensation package without negotiation. 

In China, N+1 compensation is a common severance compensation standard, where N represents the number of years the laid-off employee has worked for the company. For example, if an employee with five years of tenure is terminated, they would receive a severance package equivalent to six months’ salary.

Why it matters: The economic slowdown has led to decreased demand in the smartphone industry, which in turn has raised the specter of layoffs within the sector. 

Details: On Feb. 18, the first working day of the Chinese Year of the Dragon, Xiaomi PR manager Wang Hua denied rumors of mass layoffs on Weibo and shared a photo of a red envelope, a traditional Chinese gift that contains cash and symbolizes good fortune.

• A Xiaomi employee anonymously claimed on Feb.6 that the tech company was planning a large-scale layoff on Feb. 29, with a compensation of N+1, according to local media outlet Jiwei. The employee criticized Xiaomi’s lack of social responsibility, claiming the move could deprive employees of their year-end bonuses, which are expected to be issued on March 5.
• “On the first day back to work,” said Wang Hua via the Weibo post, “I confirmed from multiple departments that there are no plans for any layoffs. There are only normal personnel adjustments based on annual performance evaluations.” Some employees spread rumors of layoffs to cover up their shortcomings, as they do not want to admit to their poor performance, he added in a comment under the post.
• An internal Xiaomi employee informed a Jiwei reporter that the current restructuring does not mean a large-scale layoff, but falls within the regular scope of annual personnel-optimization efforts, impacting a small number of employees.

Context: On Feb. 18, Xiaomi CEO Lei Jun announced the commencement of operations for the firm’s Beijing Changping Smart Factory, which will specialize in producing Xiaomi’s flagship smartphones. It boasts an annual production capacity exceeding tens of millions of units, making it the company’s first large-scale self-owned facility.

• Shipment in China’s smartphone market hit approximately 271 million units in 2023, a year-on-year decline of 5.0% and the lowest shipment volume in nearly 10 years, according to market intelligence firm IDC. Chinese phone brands Oppo, Vivo, and Xiaomi ranked third, fourth, and fifth, respectively.

Chinese electric vehicle maker Human Horizons will suspend production for at least six months and furlough its employees in an attempt to keep the company going as it looks for new funding, local media has reported. 

Why it matters: Human Horizons, which has been selling premium EVs under the HiPhi brand since late 2020, is the latest Chinese EV startup to scramble for cash as it tries to continue operations, as competition intensifies and growth slows in the hotly contested market. 

• Shanghai-based WM Motor, founded by former Volvo executive Freeman Shen, filed for a pre-restructuring process last October after failing to go public in Hong Kong via a backdoor listing, Reuters reported. Aiways, which began exporting EVs to Europe as early as 2020, also suspended production last year, the Financial Times reported.

Details: The austerity measures were announced at a staff meeting on Sunday and immediately went into effect, people familiar with the matter told financial media outlet Caixin (in Chinese).

• Human Horizons’ workforce were told on Sunday that their base salaries would be reduced to RMB 2,690 ($374) per month, Shanghai’s minimum wage, from March 15, the Caixin report claimed. 
• A company representative denied the report, without elaborating, according to Caixin. 

Context: The firm’s financial woes have been signposted for some time. It recently closed two showrooms and has been searching for new financing after Saudi Arabia’s Ministry of Investment withdrew its intention to set up a joint venture in a $5.6 billion deal.

• Human Horizons recorded a brief success during 2021-2022 when the automaker delivered roughly 8,700 upper premium HiPhi EVs and established a presence in the luxury segment where autos are priced above RMB 500,000 ($78,450). By comparison, Porsche delivered 7,315 all-electric Taycan cars in China in 2021. 
• The low-volume carmaker has since failed to extend its advantage in the mainstream luxury segment and struggled with a cash crunch. It delivered roughly 8,000 units last year, contributed to by the sales of its third model the HiPhi Y crossover, priced at RMB 339,000, while peers Li Auto and NIO delivered more than 376,000 and 160,000 units, respectively.

Chinese tourists returned to outbound travel during the recent Year of the Dragon break as a range of data showed that the number of overseas transactions and tour bookings by Chinese citizens rebounded to the pre-pandemic levels seen in 2019. 

According to an Alipay email sent to TechNode, overseas transactions by users of the mobile payment platform from Feb. 9 to 12 were up 7% compared to 2019, with Hong Kong, Japan, and Macao being the top destinations for Chinese travelers based upon their Alipay spending.

Why it matters: By the numbers, China’s overseas tourism is making a solid recovery a year after the country’s authorities removed Covid-19 related restrictions on its citizens traveling abroad following more than three years of almost-closed borders. Major Southeast Asian countries loosening visa requirements for Chinese tourists has also had an impact.

Details: Chinese visitors could be spotted in more than 1,700 cities in 125 countries, said Beijing-headquartered online travel agency Qunar, ranging as far as Madagascar and Cuba. 

• Flight bookings to Thailand, Malaysia, and Singapore – three Southeast Asian countries that have recently waived visas for Chinese passport holders – have seen a huge surge on Qunar. Singapore leads the rise with a year-on-year growth of 2,900%.
• The return in popularity of overseas destinations comes as some domestic hotspots experienced travel issues. As the end of the national holiday loomed, a number of tourists found themselves “trapped” on Hainan island, one of China’s most popular tourist destinations, due to high-priced air tickets and congested roads during their return journeys. Many netizens joked, “Can’t afford to go to Hainan, but Southeast Asia is more cost-effective.” 
• Despite the eight-day holiday fueling long-distance outbound trips, overseas consumer spending made through Alipay only recovered to 82% of its 2019 level. Meanwhile, the enthusiasm for using messaging app WeChat to send digital versions of the red envelopes traditionally gifted around Lunar New Year cooled on Chinese New Year’s Eve on Feb. 9, as users sent and grabbed 5.27 billion WeChat red packets, significantly lower than the 14.2 billion sent seven years ago, the last time the Tencent-owned superapp released such data.

Context: The China Tourism Academy predicted earlier this month that the number of outbound tourists from the country in 2024 will reach 130 million, 50% up from the previous year.

Chair of iFlytek Liu Qingfeng told employees that the Chinese voice-recognition company has “resisted the extreme pressure from the US” and is entering “a new period of strategic opportunity,” at his firm’s annual general meeting. Speaking on Tuesday, Liu again benchmarked iFlytek’s upgraded Spark against GPT-4 Turbo, saying it expects to be as powerful as OpenAI’s most advanced model in the first half of 2024.

Why it matters: Liu’s confident tone throughout his speech is being seen as a sign that the company seems to have passed its dark days in the grip of US sanctions due to its “seizing of the strategic opportunity of large language models.”

Details: In his speech, Liu stated that the top goals for iFlytek in 2024 would be to be the fastest Chinese company to catch up with GPT-4, to “empower 10 million intelligent hardware terminals”, to produce “industry-leading applications taking the largest market share in six industries including education and finance”, and to “amass one million LLM developers to build an AI model ecosystem”.

• Liu’s address on Tuesday emphasized the importance of building “independent and controllable” home-grown AI foundation models, with the exec saying LLMs are a battlefield for gaining strategic advantage over the US.
• However, the company’s financial forecast offers a glimpse into the huge cost of achieving China’s ChatGPT alternative, with iFlytek’s net profit excluding extraordinary profit and loss expected to be down 71% to 81% to between RMB 80 million and RMB 120 million ($11.3 million to $16.9 million) in 2023 compared to the previous year iFlytek has claimed this is largely due to “firm investment” in core technology and industrial chain localization substitution.
• iFlytek also projected an up to 7% increase in revenue to RMB 20 billion for its financial year ending Dec. 31.
• iFlytek unveiled its Spark iteration model on Jan. 30, claiming it as the first such model to be built on the AI model training platform the company designed in cooperation with Huawei and which uses the Chinese telecom giant’s AI chips.

Context: The US government blacklisted A-share listed iFlytek in Oct. 2019, meaning China’s top artificial intelligence company was banned from buying critical components from US companies without US government approval.

NIO Capital, a venture capital firm founded by Willliam Li, chief executive of the namesake electric vehicle maker, has raised a new China-focused fund of more than RMB 3 billion ($416.8 million), despite a global market lull and domestic economic challenges. 

Why it matters: The fundraising milestone will allow NIO Capital to further explore the “transformative potential of innovative technologies in the automotive and energy sectors,” said Ian Zhu, a managing partner at NIO Capital, in a Monday announcement. 

• The NIO-related growth-stage investor has backed some of the rising stars in the Chinese automotive world, from battery material manufacturer Ronbay to self-driving car startups Momenta and Pony.ai. It has also invested in battery giant CATL. 

Details: The deal shows the strength of NIO Capital’s ties with its limited partners, which include venture capital investment guidance funds set up by Chinese regional governments, national funds, family offices, and listed companies, according to the announcement, which did not provide further details. 

• The Shanghai-based venture firm said it will maintain its focus on areas such as auto tech and sustainable energy with the new RMB 3 billion fund, which brings the total assets under its management to about RMB 15 billion. 
• Speaking to Chinese reporters, a NIO Capital representative stressed the fund’s independence from NIO in its final investment decision-making. “We don’t require that a parts maker only supplies to NIO,” the person said as an example of its open-mindedness, 36Kr reported.

Context: The deal comes as global private investment remains soft due to interest rate hikes and economic headwinds. 

• Fundraising totals were on track to drop 28% in 2023 compared with 2022, and the number of funds could decline by almost half, US management consultancy Bain & Company said in a note dated July 17. 
• In China, roughly 5,300 private capital funds raised a total of RMB 1.35 trillion during the first nine months of 2023, down 2.1% and 20.2% from a year earlier, according to consultancy Zero2IPO (in Chinese).

Nvidia is making a strategic return to the Chinese market by introducing its China-specific H20 AI chip, a move that comes after US policies affected the company’s sales in China. Nvidia has begun taking pre-orders from distributors for its H20 AI chips, priced almost on par with Huawei’s Ascend 910B, according to Reuters.

Why it matters: To address challenges posed by the US’s bans on the sale of certain GPUs (Graphics Processing Units) to China, Nvidia has launched cut-down variants compliant with American export policies. Amid concerns about potential limitations on accessing Nvidia’s products, Huawei’s chip is widely acknowledged as the leading alternative AI offering in China.

Details: Prior to the US curbs, Nvidia held over 90% of the AI chip market in China, according to the Reuters report. However, it is now facing growing competition from local competitors such as Huawei. The H20 AI chip is priced at $12,000 to $15,000, positioning itself as a competitor to Huawei’s Ascend 910B. 

• In October 2023, the US government imposed new restrictions on the export of advanced AI chips, leading Nvidia to immediately halt shipments of high-performance AI chips including the A100, A800, H100, H800, and L40S products. Subsequently, Nvidia initiated the development of new AI chips specifically designed for the Chinese market, including the H20, L20, and L2. All three chips are modified versions of Nvidia’s H100 AI chip.
• While the H20 is expected to provide less computing power than Nvidia’s flagship H100 AI chip, specifications suggest its performance is also inferior to Huawei’s Ascend 910B in certain key aspects. Notably, the H20 may lag behind the 910B in FP32 performance, a critical metric that measures processing speed, and is rated at less than half of its competitor’s capability, the source behind the Reuters report told the news agency.
• However, the H20 is likely to have an edge over the 910B in terms of interconnectivity speed, with the H20 being competitive in applications that require the connection of a large number of chips to function as a system, the report explained.
• In terms of performance, the H20 chip’s AI computing power is slightly less than 15% of the H100, according to US media outlet Wccftech. The H20 AI chip features 96GB memory capacity operating at up to 4.0 Tb/s, 296 TFLOPs computing power, and a performance density of 2.9 TFLOPs/die, compared to the H100’s 19.4 TFLOPs/die.
• Distributors have reportedly informed clients that they can start deliveries of H20 products in small batches during the first quarter of 2024, with larger quantities available from the second quarter. Last month, it was reported that Nvidia intends to mass produce the H20 in the second quarter of this year.

Context: On Jan. 20, Nvidia CEO Jensen Huang visited the company’s offices in Shenzhen, Shanghai, and Beijing for the annual parties held in celebration of China’s Lunar New Year holiday, with the company clarifying that the visit did not involve business operations.

The Chinese electric vehicle segment briefly lost momentum in January as a majority of automakers reported a significant sales drop on Thursday during the traditional low season, a contrast to December when big promotions and exciting discounts gave a short-term sales boost at year-end. 

Why it matters: The decline was especially marked for BYD, which accounted for nearly a third of the country’s green energy vehicle sales last year. The biggest Chinese EV maker maintained its leading position with sales of more than 201,000 units last month, although that number represented a 41% decrease compared to December. 

• Geely and Huawei-backed Aito are among the few bright spots that have bucked the trend with their new models, becoming potential challengers to BYD’s dominance. Meanwhile, international carmakers such as Volkswagen and General Motors posted decent sales with local partner SAIC, showcasing their efforts to play catch-up. 

Ups: Geely posted its best-ever month with sales of 65,826 fully electric and plug-in hybrid vehicles last month, roughly 5,400 units more than in December and nearly six times greater than what Volvo’s parent achieved a year ago. This growth was partly due to strong sales of its Galaxy and Lynk & Co brands, which sold 19,223 and 28,176 units over the month, respectively. 

• Aito also delivered a record 32,973 cars in January. That is in line with the company’s outlook and stands in stark contrast to the same month last year when it reported deliveries of only 4,475 vehicles. The brand, launched by Huawei and its manufacturing partner Seres, said on Thursday (in Chinese) that it has secured 140,000 non-refundable orders for its redesigned M7. 
• Avatr, another Huawei-backed and Changan-owned EV brand, also posted improved sales volume for January buoyed by the positive demand for its second model launched in November. However, an ongoing shortage of Huawei’s key components may add uncertainty to the outlook of the premium brand and its peers, as reported by Reuters. 

Downs: On the other hand, China’s US-listed EV trio are the ones under pressure by reporting their lowest monthly deliveries since June, as they engage in a relentless price war with larger tech and auto forces. Both Li Auto and NIO slashed prices on current lineups last month as they prepare to launch revamped models in March, potentially causing some customers to postpone purchases. 

• Sales of Aion, which has sold a large proportion of its vehicles to ride-hailing fleets, also dropped 46% month-on-month to 24,947 units in January. The EV maker, affiliated with state-owned automaker GAC, is now ramping up efforts to go abroad, as sales in the overseas markets reached the threshold of 3,000 units for the first time last month. 
• Deliveries of Great Wall Motor and Deepal, another Changan subsidiary, also decreased by 16.2% and 7.1% to 24,988 and 17,042 units respectively, from December. Meanwhile, IM Motors, a premium EV brand launched by China’s SAIC, saw a bigger drop with its January number more than halved from a month earlier to 5,305 units.

Context: China’s sales of new energy vehicles, mainly all-electrics and plug-in hybrids, increased 92% year-on-year from Jan.1-28 partly due to the year-ago low base effect marked by a wave of Covid cases after Beijing dismantled pandemic controls in December 2022. However, that number was 24% down compared with December when most automakers made a year-end sales push, figures from the China Passenger Car Association (CPCA) showed.

TikTok turned against its former cooperation partner Universal Music Group (UMG) overnight after the world’s largest music copyright owner threatened to remove all of the music it owns from the video-sharing platform, which lambasted UMG’s “self-serving actions” and characterized them as putting their interests above those of artists, songwriters, and fans. 

Why it matters: The dispute would reportedly also affect TikTok sibling Douyin, potentially causing both platforms to have to remove Universal songs from the huge number of videos using them as background music. The falling out with UMG may also lead to a similar response from other music companies. 

Details: The collapse of the deal would likely remove the pop songs that myriad TikTok videos use as background music, affecting tracks by Universal artists including Taylor Swift and Billie Eilish, as well as Chinese language singers Stefanie Sun and Eason Chan.

• In an open letter, Universal said the success of TikTok has been largely rooted in the music created by “our artists and songwriters,” but revenue from the Chinese-owned company only accounts for about 1% of Universal’s income, which the letter claimed was a poor rate of compensation.
• According to media outlet Caixin, the three-year authorization contract between both sides signed in February 2021 was also applied to TikTok sister app Douyin in China, meaning Douyin users are no longer allowed to create videos using copyright-protected music from UMG starting from Thursday, unless the two parties reach a new deal addressing Universal’s concerns over higher pay for artists, AI creation, and user protection.
• In response, TikTok claimed Universal’s statement formed a “false narrative and rhetoric,” and blamed the music firm for leaving a platform that had served as a “free promotional and discovery vehicle for their talent.”

Context: This is not the first dispute involving a major tech platform and Universal-signed artists. In 2014, Taylor Swift decided to remove her entire discography from Spotify due to issues around royalty payments, with her boycott of the streaming service lasting three years.

Chinese AR (augmented reality) glasses manufacturer XREAL has recently secured a new round of strategic financing valued at $60 million, bringing its total funding to $300 million, according to an exclusive report by Chinese media outlet 36Kr. The report asserted that XREAL’s current valuation has surpassed $1 billion, as indicated by industry analysts.

Why it matters: As a major player in the global AR device sector, XREAL’s devices are considered potential competitors to Apple’s Vision Pro and Meta’s Quest 3. This strategic financing empowers XREAL to pursue vital growth initiatives, such as expanding its AR glasses production.

Details: The new financing, which is dedicated to product R&D (research and development) and the expansion of the firm’s optical production base, will enable XREAL’s AR glasses production to reach two million units per year by 2025, the 36Kr report said.

• XREAL has not disclosed the specific investors behind the new $60 million financing. Previous major investors in XREAL have included Alibaba, Kuaishou, NIO Capital, Yunfeng Capital, Sequoia China, Gentle Monster, Hillhouse Group, Hongtai Aplus, CICCcapital, Shanghai GP Capital, Shunwei Capital, CPE Asset Management, China Growth Capital, and iQiyi.
• XREAL’s Founder and CEO, Xu Chi, has declared that the company aims to deliver wearable augmented reality displays to global audiences, as AR has revolutionized user experiences in gaming, movies, TV, in-car entertainment, displays, and work.
• From Jan. 9 to Jan. 12, XREAL exhibited its latest XREAL Air 2 Ultra glasses during the 2024 CES (Consumer Electronics Show) in Las Vegas, featuring six degrees of freedom (6DoF) via dual 3D environment sensors with computer vision capabilities. 
• The global release of the Air 2 Ultra glasses is scheduled for March, with a starting price of $699, and pre-orders are already available. Despite the increased cost compared to the previous Air headset, which was priced below 500 dollars, the Air 2 Ultra glasses still present a more budget-friendly option than Apple’s Vision Pro, which is priced at $3,499.

Context: The XREAL Air series of products are compatible with a variety of mainstream gaming and streaming entertainment devices, including Microsoft Xbox, Sony PlayStation, Nintendo Switch, Valve Steam Deck, ASUS ROG Ally, iOS, Android, Windows, and Mac.

• On Jan. 4, XREAL announced a total shipment of 350,000 AR glasses since its establishment in 2017. The company claimed to currently hold a 45% share of the global AR market, a statement that came after market intelligence firm IDC confirmed XREAL secured a 51% market share in the global AR segment during the third quarter of 2023.

The past year has seen Tencent’s TikTok-like short video service “deliver the expected results,” chairman and chief executive Pony Ma said at the tech titan’s annual staff meeting on Monday, while reaffirming his confidence in the company’s long-term development despite the sluggish general market.

Why it matters: In contrast to his sharp-tongued speech a year ago, where the emphasis was on cost-cutting, Ma’s more positive comments this year signal that he seems to think the company has overcome its challenging times.

Details: A year after Ma positioned WeChat Channels as Tencent’s major hope for the future, he said that the short video-sharing function has brought “lots of surprises” and committed to fully supporting livestreaming-based commerce in 2024. 

• In a half-hour speech that struck a positive tone, Ma mentioned recent news of Tencent buying land in the Haidian district of Beijing at RMB 6.42 billion as a “careful and calculated decision” due to the steady growth of the firm’s businesses. 
• Boasting 1.3 billion monthly active users, WeChat stands as the most powerful messaging app in China and comes with a flurry of social connecting features, but the app’s 12-year-old history gives Ma “great pressure,” especially as QQ, Tencent’s once-popular platform, undergoes a crucial transformation after 12 years in operation. Ma has called for WeChat, “the old tree”, to “sprout new shoots”.
• Ma also stated that Tencent’s current holding of the title of the world’s largest game vendor feels like “relying on the credit of our [previous] successes.” This sentiment comes amidst challenges from peers releasing new titles and the company’s relatively underwhelming offerings when it comes to fresh games, according to local media outlet Jiemian.

Context: Tencent shares have suffered in the past year but have not seen as big a slump as those of its Chinese internet peers, with the firm seeing a 16% decline in the value of its Hong Kong-listed shares. The company’s largest shareholder, South Africa-headquartered Naspers, added to the downward trend by cutting its stake in Tencent to less than 25% through frequent share selling in 2023.

CATL and Didi said on Jan. 28 that they have signed a partnership to build battery swap stations for commercial fleets to recharge their electric vehicles, in a sign of China’s urgent need to set up a gold standard for EV infrastructure.

Why it matters: The news reflects how major players are rushing to build alliances and expand their presence in the hope of getting a larger say as the Chinese central government is pushing for industry-wide standards to drive EV adoption and reduce the strain on the grid. 

• Xin Guobin, a vice minister of industry and information technology, in June said Beijing will back businesses’ efforts to jointly set standards for battery specifications and swap techniques. 
• Meanwhile, the central government recently set a goal to begin operating large facilities for bi-directional charging in the next two years, which would allow EV batteries to charge during off-peak hours and return surplus energy to the grid when demand is high.

Details: CATL and Didi will set up a joint venture for a fast and large-scale roll-out of a battery-swapping network for ride-hailing services in China, according to a joint announcement, which did not reveal detailed plans for the swap network or the size and structure of the JV. 

• The two companies will also promote the adoption of EVs with swappable batteries while exploring collaboration on other areas such as storage-integrated EV charging facilities, the statement said.
• CATL expects such efforts to enhance its reputation since public infrastructure could help promote it as a purveyor of better quality and longer service life, people close to the company told Caixin.

Context: NIO is for now the dominant player in the field, operating more than 2,300 battery swap stations in China as of December. The EV maker plans to add at least 1,000 more this year and has partnered with big names including Geely, Changan, and Chery. 

• China reported a significant 81% annual increase for its battery swap infrastructure network with a total of 3,567 swap stations as of December, according to data compiled by the Electric Vehicle Charging Infrastructure Promotion Alliance (EVCIPA).

The National Press and Publication Administration (NPPA) of China released its first batch of domestic game licenses for 2024 in the early hours of this morning, with its approval of 115 games sparking hope for a stable and positive regulatory environment in the industry this year.

Why it matters: Over the last two years, the average monthly issuance of domestic game licenses was around 80, with January 2023 only reaching 88. Today’s approvals represent the highest number of monthly licenses granted for two years. 

Details: The batch of 115 approved games includes 100 mobile games, eight dual-end (PC and mobile) games, four PC games, one PS game, and one web-page game.

• The main gaming titles are Need for Speed by Tencent Games, Etheria: Restart by X.D.Network, My Three Body: 2277 by YOOZOO Interactive, Call of Dragons by Lilith Games, Wait a Minute by 37 Interactive Entertainment, Anno: Mutationem by Leiting Games, and Youxing Continent by Bingchuan Network.
• The Three-Body Problem is an international award-winning science fiction novel written by Liu Cixin, widely acclaimed for its profound ideas, captivating storyline, and scientific precision. As the first officially licensed Three-Body Problem game, the turn-based strategy title My Three Body: 2277 has consistently garnered attention in China. In October 2023, details of the gameplay were unveiled, accompanied by the opening of online pre-registration, and the game is scheduled for a launch for both mobile and PC platforms in the first half of this year, according to Cailian Press.
• Launched globally in March 2023, Call of Dragons, developed by LEGOU Games and distributed by Lilith Games, is available for overseas markets on Android, iOS platforms, and PC. Call of Dragons is a multiplayer Western-style fantasy strategy game with 3D modeling, initially positioned for international audiences. Currently, the game has gained between 5 million and 10 million downloads on the Google Play Store in the global market, according to market intelligence firm SensorTower. However, it remains to be seen whether the game will find similar success with Chinese audiences.
• Additionally, the NPPA approved a number of previously-licensed games on new platforms for 2024. NetEase’s card collection role-playing game Harry Potter: Magic Awakening and Perfect World’s turn-based role-playing game Persona 5: The Phantom X have both added a PC version, while X.D.Network introduced the Nintendo Switch version for its puzzle adventure game Moncage.

Context: In 2023, the NPPA released 977 domestic game licenses, representing a year-on-year growth of 108.76%. 

• In December 2023, an industry report from The China Game Industry indicated that the revenue of the domestic gaming market reached RMB 3,029.64 billion ($426.83 billion) in 2023, a year-on-year growth of 13.95% and the first time that China’s gaming market has surpassed three trillion RMB. The user base also reached a historic high of 668 million.

BYD and FAW Group are aiming to invest in DJI’s automotive business unit – one of the few Chinese companies capable of developing partially automated driving software – as part of the latest effort by traditional automakers to catch up with rivals such as Tesla, local media has reported. 

Why it matters: The news comes at a time when a growing number of automakers and suppliers are expanding their alliances in hopes of accelerating progress in and sharing the cost of making partially automated driving passenger cars. In China, the technology is being popularized by the likes of Tesla, Huawei, and Xpeng Motors. 

• It is also the latest example of Chinese auto majors taking steps to turn their business partnerships with tech companies into deeper capital relationships. Changan Automobile recently announced it will invest in a new venture set to absorb Huawei’s car business unit. 

Details: BYD and FAW, a manufacturing partner of Volkswagen and Toyota in China, recently conveyed their message to DJI Automotive, the car business unit of the namesake drone maker, 36Kr first reported on Wednesday (in Chinese). Citing people with knowledge of the matter, the report did not put a figure on the planned investment.

• BYD is planning to roll out partially automated driving functions for future affordable models priced at RMB 200,000 ($27,920) or below in 2025 with assistance from DJI, a person close to the company told TechNode on Thursday. 
• DJI is appealing to original equipment manufacturers (OEMs) for its low-cost advanced driver assistance system, as they have been struggling to lower costs and repeatedly cut prices of their cars, another source with direct knowledge of the matter told TechNode. 
• DJI, China’s biggest drone maker, stated that its technology suite, including an affordable computing chip from Texas Instruments (TI) with only a few cameras, could enable cars with automatic lane changing and on-ramp to off-ramp functionalities on Chinese expressways. 
• Some EV makers, including NIO and Li Auto, have developed similar functions based on Nvidia’s more expensive DRIVE Orin processors, with each offering 254 trillion operations per second (or TOPS), compared with the 32 TOPS offered by a top-end TDA4 chip from TI. 
• “While BYD is not the forerunner in autonomous driving, it has the ability to be a fast follower which will likely meet the needs for the majority of Chinese consumers,” Bernstein analysts wrote in a Jan. 22 note, citing economies of scale, which allows it to collect more data for software training from its large fleet, as one of the reasons.
• BYD and DJI did not respond to TechNode’s requests for comment. 

Context: Shenzhen-headquartered DJI separated its car business into an independent company in late 2022 and became open to external funding with a target valuation of $1.5 billion, Chinese media outlet Leiphone reported in August. 

• The drone giant has worked with SAIC-GM-Wuling (SGMW), a General Motors China joint venture, since 2019, with the first model integrated with its automated driving technology, the Baojun Kiwi EV, going on sale with a price tag of RMB 102,800 in September 2022. 
• BYD showcased a Yangwang luxury off-roader that integrates an unmanned aircraft on the car’s roof in a collaboration with DJI during a press event on Jan. 16. It also announced plans to release at least 10 new models this year featuring advanced driving technology.

READ MORE:  BYD’s Denza launches cheaper driver assistance system with Nvidia amid rising competition

Last week’s global launch of Papergames’ Love and Deepspace, a title touted as the first otome game to feature 3D modeling, has sparked a battle over the female-focused romance games market, with China’s major gaming companies weighing in with a raft of special offers and promotional events.

Otome games are typically targeted towards female players, with the Japanese term translating to maiden or young lady. The games often involve a female protagonist who interacts with male characters, and the gameplay focuses on developing romantic relationships with one or more of these characters.

Why it matters: Having previously found success with otome game Mr. Love: Queen’s Choice, Papergames’s new title aims to provide players with a more realistic interactive experience through its iterative improvements in 3D character modeling. The release has sparked intense competition in the sector.

Details: On January 18, the day Love and Deepspace launched, China’s major domestic gaming companies all unveiled new promotional activities within their respective otome games. Light and Night from Tencent Games, HoYoverse’s Tears of Themis, and For All Time by NetEase Games are among the genre’s most popular titles, alongside Papergames’ Mr. Love: Queen’s Choice.

• On the day of the Love and Deepspace’s release, a trending hashtag #0118决战国乙之巅# (Battle for the Peak of Chinese Otome Games on January 18) appeared on China’s Twitter-like platform Weibo. Posts under the hashtag listed the various promotional activities and benefits of domestic otome games, as Chinese players expressed their excitement over the developments.
• In order to compete for potential new players, NetEase’s new otome game Beyond the World, originally scheduled for a public beta release on January 26, announced on January 16 that it would bring its open testing period forward to January 18. NetEase also offered various in-game promotional events and benefits that were similar to those available in Love and Deepspace.
• Also coinciding with the Love and Deepspace’s launch, Tencent Games held its largest celebration event for the Light and Night since its launch in 2022, showering players with free benefits. Players can even receive animated video calls from game characters as part of the new offerings. Furthermore, Light and Night announced an ancient-style gacha event, a gameplay mechanic where players spend in-game currency to obtain random rare virtual characters. 
• Love and Deepspace had already received over 14 million pre-registrations before its official release, according to Papergames. At time of writing, the game is in the top ten iOS free-download games in the Chinese region. The game’s estimated revenue from iOS on the first day reached RMB 5.27 million ($740,000), while iOS downloads amounted to 890,000 during the same period, according to market intelligence firm DataEye.

Context: Otome games are popular in Asia due to culturally resonant narratives, attractive character designs, and targeted marketing towards female players. They align with animated gaming trends in the region, providing escapism through romantic fantasy scenarios.

• According to Qimai Data, Mr. Love: Queen’s Choice, generated a revenue of RMB 760 million ($108 million) in 2023.
• In September 2023, SensorTower released its State of Mobile Games Preferred by Women insights report (in Chinese), stating that the annual revenue for 2023 from female players was expected to exceed $16 billion.

Alibaba’s secondhand trading app Xianyu is on track to open an offline marketplace in the Gongshu district of Hangzhou, the resale operation’s latest eye-catching move after the platform was anointed one of Alibaba’s four “strategic-level innovation businesses” last November.

Why it matters: Alibaba is giving Xianyu three years to prove its value and operate as an independent subsidiary, with this attempt at a physical store seen as the first major step.

Details: The bricks-and-mortar flea market, scheduled to open this Sunday, will see local customers sell their used items and purchase items from other secondhand sellers directly, the platform said in a post on its official WeChat account.

• Xianyu says individuals can also list services such as running errands for others and walking dogs to earn extra money.
• The opening of the store aims to simplify communication between buyers and sellers, with sellers able to receive immediate payments via Alipay once their items are sold, unlike online where the process relies on a buyer clicking the “Received Goods” button for payment to proceed.
• Xianyu says the marketplace will accommodate digital products, outdoor sporting goods, clothing, and shoes, as well as luxury goods. However, trading in food and health products, pets, plants, and jewelry will be strictly prohibited.

Context: The popularity of Xianyu has been overshadowed by e-commerce retailers Taobao and JD in recent years as consumers have tended to seek brand-new goods, but, when it comes to collectible toys or cards, the platform has become a popular destination, especially for young people. This status has meant that Gen Z users, born between 1995 and 2010, account for more than 60% of Xianyu’s 500 million account holders, the company’s latest figures show.

• Alibaba CEO Eddie Wu in November identified Xianyu, along with 1688, DingTalk, and Quark as the company’s most promising businesses, saying he saw the potential for China’s largest secondhand trading platform to “become a lifestyle platform for consumers’ hobbies and interests.”

Huawei and Dongfeng Motor, a Chinese manufacturing partner of Stellantis, are in an ongoing collaboration to develop smart electric vehicles, the companies have announced. This adds to a string of such deals by technology giant Huawei as it accelerates its entry into the auto market. 

The partnership could help Voyah, a subsidiary of state-owned automaker Dongfeng, increase sales and expand its presence in the red-hot EV market where a wave of consolidation and reshuffling is underway, according to David Zhang, a visiting professor at Huanghe Science and Technology University. 

Why it matters: The alliance is the latest example of Huawei’s multifold endeavor to expand into EVs. It has pushed two initiatives to enhance cooperation with carmakers in particular. 

• One is the so-called “Huawei Inside (HI)” business model, signifying that cars will feature Huawei’s full-stack technologies such as automated driving software and infotainment systems. Changan Automobile and Mercedes’ Chinese partner BAIC are among its partners. 
• The other is “Smart Selection,” in which Huawei not only provides technologies but also sales channels while gaining control over vehicle development. Aito has been the biggest success story under this approach, followed by the recent launch of Luxeed between Huawei and Chery. 

Details: According to Zhang, Huawei will adopt the HI approach with Dongfeng, mainly selling the carmaker components and software, and will probably not go into as much depth as it did with Seres. 

• This would allow Dongfeng, controlled by the State-owned Assets Supervision and Administration Commission, China’s state asset regulator, to maintain control of its premium EV brand, Zhang said. 
• As more EVs embrace cutting-edge technologies, an automated driving system powered by Huawei could be a big selling point for Voyah, elevating it above other brands. The tie-up could see the companies share development and marketing costs, Zhang added. 
• In a Monday announcement (in Chinese), Huawei and Dongfeng said they will move forward with the large-scale adoption of intelligent technologies with the joint development of new cars, without giving further details. 

Context: Huawei has been working on the spin-off of its automotive business unit for several months. The company in November announced plans to establish a joint venture with Changan, stating that other existing partners such as Seres have been invited to invest in the new entity. 

• Voyah posted significant growth in sales last year with deliveries of 50,552 vehicles, compared to less than 20,000 units sold a year earlier. The automaker in August launched a revamped version of its Free mainstream luxury crossover with a starting price of RMB 266,900 ($36,532) featuring Baidu’s automated driving assistance system.

On Thursday, Huawei announced open applications for its developer preview version of HarmonyOS NEXT, with plans to release a more feature-complete developer beta version in the second quarter and a commercial version by the fourth quarter of 2024 as it looks to cut its ties with Android.

Why it matters: While all previous consumer versions of Huawei HarmonyOS have been compatible with Android, HarmonyOS NEXT will break away from Android architecture, establishing itself as a truly independent operating system.

Details: Huawei began the development of HarmonyOS in 2015 and subsequently released different versions from HarmonyOS 1.0 to 4.0. HarmonyOS NEXT will be the Chinese tech giant’s first OS not to accommodate Android applications and will not support the opening of APK files (Android application packages), according to statements made at Huawei’s launch event. Huawei opened recruitment for the HarmonyOS NEXT developer preview version on Monday, allowing users of its Huawei Mate 60, Mate 60 Pro, and Mate X5 phones to sign up.

• Huawei plans to partner with enterprises, universities, and institutions to train over 100,000 HarmonyOS developers each month. The company is introducing the Yaoxing Plan, with an investment exceeding 7 billion RMB ($9.84 billion), to incentivize innovation in the HarmonyOS ecosystem, including native applications and SDKs (software development kits).
• At the time of writing, more than 200 software companies have initiated the development of native HarmonyOS applications, making up 90% of the leading applications in the domestic sector, according to Huawei. Huawei aims to achieve a short-term goal of reaching 5,000 collaborative apps by the end of this year, and anticipates exceeding 500,000 applications to join the native HarmonyOS ecosystem in the long term.
• Huawei’s Consumer BG CEO, Yu Chengdong, mentioned at the event that HarmonyOS has made breakthroughs in core technologies, including AI frameworks, large-scale models, design systems, programming frameworks, programming languages, and compilers.
• Huawei first introduced HarmonyOS to address user experience issues arising from US sanctions. However, the company is now seeking to break free from the constraints of the existing Android framework, and create an integrated architecture that combines software, hardware, and cloud services, according to the president of Huawei Consumer BG software department Gong Ti.

Context: In June 2023, according to local media outlet Zaker, Huawei stated that a 16% market share in the operating system is a critical threshold for success, based on the developmental history of the PC and mobile industries.

• Due to Huawei’s current inability to integrate GMS (Google Mobile Services), the 16% goal primarily refers to the Chinese market, where HarmonyOS has already captured a 13% share, as reported by CounterPoint Research.

China’s SAIC Motor Corp will spend $1.4 billion building 12 fossil liquefied natural gas (LNG)-powered ships to export cars, as Chinese electric vehicles spread overseas and the European Union tightens its climate and trading policies to reduce greenhouse gas emissions.

Why it matters: The move is the latest example of how EU regulations are pushing Chinese automakers to make changes to the way they operate, and adds to the challenges they face in expanding to overseas markets with their EVs.

Details: China’s biggest automaker said on Wednesday that the SAIC Anji Sincerity has begun its maiden trade voyage from Shanghai to Europe. The ship spans 200 meters (656 feet) in length and boasts capacity for 7,600 cars, making it the world’s largest ro-ro vehicle transport vessel partly powered by sustainable fuel. 

• The container carrier is powered by both diesel and LNG, a form of natural gas that has been cooled to a liquid for easier storage and transportation, providing as much as a 30% reduction in carbon dioxide (CO2) emissions compared to similar-sized, diesel-only vessels, according to an announcement on China’s Twitter-like platform Weibo. 
• SAIC expects to spend RMB 10 billion ($1.4 billion) on building 12 LNG carriers and lease two more for the next three years. The biggest of them will be able to carry as many as 9,000 cars, Zhao Aimin, vice president of SAIC Motor International, told financial media outlet Caixin (in Chinese). 
• Volkswagen’s Chinese manufacturing partner expects its carriers to have a total combined capacity of 1.8 million cars per year by 2026. Its wholly-owned subsidiary Anji Logistics currently operates a fleet of 31 carriers on seven routes to Europe, Southeast Asia, and Latin America, and works with automakers Dongfeng and Great Wall Motor among others. 
• Zhao also mentioned SAIC’s goal to sell 1.35 million cars overseas in 2024, which would mark a growth of more than 11% from the 1.2 million units it achieved last year. That number could be further increased to 1.5 million in 2025, with at least 14 new energy vehicles, including plug-in hybrids and all-electrics, set to go on sale globally over the next two years. 

Context: SAIC is not the only Chinese carmaker to build its own fleet and set its sights on going global. Its move takes place as China recorded exports of 5.2 million cars last year, meaning a 57.4% annual growth rate, and is set to dethrone Japan to become the world’s largest car exporter. 

• BYD’s first roll-on, roll-off, chartered vehicle carrier, named BYD Explorer No. 1, set sail towards Germany and the Netherlands from its base city of Shenzhen on Monday. Carrying more than 5,000 EVs, the vessel is reportedly managed by London-based Zodiac Maritime Ltd. and is being rented to BYD. 
• The EU began mandating shipping companies, among other businesses, to buy CO2 permits for 40% of the CO2 generated by their fleets from January, a percentage that will grow to 70% and 100% over two years from 2025, Reuters reported. 
• Meanwhile, the European Commission launched an anti-subsidy investigation of China-made EVs last October.

In a brief letter to Kuaishou staff from CEO Cheng Yixiao on Tuesday, the short video platform operator announced it had achieved its first yearly profitability since listing, and was offering staff vouchers of up to RMB 2,866 valid for purchases on Kuaishou as an expression of gratitude for employees’ efforts.

Why it matters: The rival to ByteDance’s Douyin (China’s TikTok sibling) accelerated its monetization efforts in real estate and short dramas after achieving its first quarterly profitability in the second quarter of 2023. Rapid growth of these sectors in turn appears to have boosted the Beijing-based company’s further attainment of quarterly profits.

Details: China’s second-largest short video platform, Kuaishou deepened its focus on the real estate industry in a recent restructuring following impressive sales results.

• The platform’s real estate operations saw housing agents and professional property influencers engage potential homebuyers via videos and livestreaming sessions, following up with on-site property viewings, and in some cases, remote contract signings resulting in the postal delivery of keys for their new house or apartment.
• According to data revealed by Kuaishou, during a one-month campaign in September, more than 5,500 properties were sold on the platform, valued at more than RMB 6.9 billion in total. In 2022, over 100 million users on Kuaishou watched real estate sales livestreams or related videos; total sales of the sector for that year surpassed RMB 10 billion.
• Mini web dramas, meanwhile, have served as another business sector with growth potential for Kuaishou. As widely popular short video platforms have reshaped user preferences for content delivering quick fire stimulation, short and cheap to make series with episodes lasting little more than five minutes, have gained favor with large Chinese audiences. 
• Kuaishou said last week that daily active viewers of its short dramas reached 270 million by the end of 2023, with 94 million people watching more than 10 episodes per day.

Context: In the first nine months of 2023, Kuaishou reported a net profit of RMB 2.79 billion compared with a loss of RMB 12.15 billion in the same period of the year before. 

BYD has signed an agreement with Spain’s Grenergy to provide renewable energy power facilities using its blade-shaped batteries for a $1.4 billion energy storage operation in Chile’s Atacama Desert, which the companies claim to be the largest of its kind globally. 

Why it matters: The deal is the latest in BYD’s efforts to scale up its energy storage business and lead in areas beyond electric vehicles, venturing into the booming renewable energy sector, as global EV sales are reportedly poised for slower growth due to lower state subsidies this year. 

Details: BYD will provide Grenergy with a total of 2,136 large-scale energy storage systems powered by 1.1 gigawatt-hours (GWh) worth of its so-called blade battery, which boasts efficient space utilization and high thermal stability in a thin and lengthy form, according to a statement. 

• Grenergy will incorporate them in the first two phases of the Oasis de Atacama project in northern Chile, set for full operation within two years, and with a total capacity of 4.1 GWh and 1 gigawatt (GW) of solar installations. 
• The Spanish renewable energy group said it expects to complete construction of the largest energy storage project worldwide within three years. The project consists of five phases with a total investment of $1.4 billion.

Context: BYD had captured around 11.5% of the global energy storage system market with shipments of 14 GWh worth of batteries in 2022, industry tracker SNE Research said in an annual summary dated March 2, 2023. This places it ahead of South Korea’s LG Energy Solution and Samsung SDI, but significantly behind leader CATL, which controlled more than 40% of the market. 

• Having facilitated several solar power and battery storage facilities in the US, CATL said last March that it would supply 450 megawatt-hours (MWh) of lithium-ion batteries for a Texan storage project. A single GW is equal to 1,000 megawatts.
• Tesla is also reportedly doubling down on its energy business with the April announcement that it was setting up a new facility in Shanghai capable of annually making 10,000 large-scale, energy-storage battery systems. It deployed 6.5 GWh of energy storage in 2022.
• The US automaker estimates that to fully convert the world to sustainable energy will require a total capacity of 2,310 GWh per year of electric-chemical battery storage systems. Chinese battery maker Svolt expects that, in the best case scenario, that number could be achieved in 2030. 

On Jan. 13, Tencent announced that its hit game Honor of Kings would resume livestreaming on Douyin (China’s TikTok sibling) five years after it was banned following a copyright infringement case. In 2016, Tencent sued ByteDance for livestreaming the online game on its subsidiary video platform Xigua. In 2019, a court ruling in Guangzhou stated that ByteDance platforms were prohibited from livestreaming Honor of Kings without Tencent’s permission.

Why it matters: The return of Honor of Kings to Douyin signifies a further thawing of the relationship between Tencent and ByteDance. Tencent has been gradually lifting restrictions on ByteDance, as its competitor has begun scaling back its gaming interests in recent months.

Details: Tencent’s Honor of Kings is expected to start livestreaming on Douyin on Jan. 21, with game streamers invited to participate in the splashy return, as announced on the game’s page on China’s Twitter-like platform Weibo.

• Tencent Games plans to conduct testing of Honor of Kings on Douyin from Jan. 14 to Jan. 17, aimed at avoiding technical issues that may arise during the first live broadcast. From Jan. 18 to Jan. 20, Honor of Kings will host various game-themed activities on Douyin, with invited gaming influencers heading livestream sessions and handing out in-game benefits.
• A gaming industry insider said Tencent’s efforts to reconcile with Douyin stem from a noticeable slowdown in Tencent’s gaming revenue growth since 2022, according to Sina. New player growth and revenue for Honor of Kings have been weaker than in previous years, leading to immense pressure on Tencent’s gaming team, the insider said. 
• Another of Tencent’s hit games, PUBG Mobile, has also seen a decline in users, but there are currently no other new hit games to make up for the loss, the same insider added. In December 2023, Tencent released DreamStar, a new party game with the potential to challenge its domestic rival NetEase’s Eggy Party. At this stage it remains uncertain if it will emerge as the firm’s next hit game.
• Both parties may seek further collaboration in the future, as ByteDance has the potential to work with Tencent in areas including joint operations and distribution partnerships, according to the same Sina report. Douyin currently plays a crucial role in the gaming industry in China as a major channel for advertising and new player acquisition, and Tencent cannot afford to ignore it, the Sina report said.

Context: On Jan. 9, TikTok owner ByteDance said it was engaged in discussions with various potential buyers, including Tencent Games, for its gaming assets, according to Reuters. The two giants are discussing a deal involving major games published by ByteDance’s gaming unit Nuverse, as the TikTok owner looks to step back from the gaming industry.

• In November 2023, ByteDance unveiled plans to scale down its Nuverse gaming unit and sell related gaming assets in a strategic shift away from the gaming industry.
• Honor of Kings, a hit multiplayer online battle arena (MOBA) game, generated nearly $1.48 billion in 2023 for Tencent, but saw a notable decline compared to the $1.8 billion achieved in 2022, according to market intelligence AppMagic.

On Tuesday, the world’s largest and most influential consumer electronics show CES 2024 kicked off in Las Vegas. Generative AI, AI-powered PCs, AI chips, emerging display technologies, XR, robots, wearable devices, and smart driving software are among the highlights of this year’s four-day exhibition. There are over 4,000 participating companies at CES 2024, with more than a quarter coming from China, according to CES.

Why it matters: Chinese companies at CES gain global exposure, connecting with international partners and potential investors to showcase their products and expand markets. The premier tech event, which enhances Chinese brand visibility and provides insights into the global innovation ecosystem, fosters a healthy global competitiveness.

Details: Here are some of the most influential Chinese exhibitors and their products:

• Of the Chinese corporations attending, TCL has the largest exhibition space of nearly 1,700 square meters, showcasing the world’s largest 115-inch QD-Mini LED high-end TV as its centerpiece. The technical challenge of the TV lies in its massive screen, which still achieves a high display brightness of up to 5,000 nits. TCL has also introduced a self-developed Mini LED image quality enhancement chip called AiPQ ULTRA, which is expected to enter mass production later this year.
• Lenovo has unveiled more than 10 PC models equipped with AI capabilities, including the ThinkPad X1 Carbon business laptop that features built-in CPU, GPU, and NPU engines. Another notable product is the ThinkBook Plus Gen 5 Hybrid, which switches fluidly between Windows and Android systems. On the software front, Lenovo has also unveiled AI Now, a PC assistant developed on Alibaba’s answer to ChatGPT TongYi QianWen, which the company says enables natural language interaction in scenarios related to work, study, and device management. AI Now is expected to launch in the first half of 2024 and will be integrated into the latest ThinkPad products.
• ASUS launched the 2024 edition of the Zenbook S 13 OLED laptop (UX5304), featuring Intel Core Ultra 5/7 chips and claimed as the world’s thinnest 13.3-inch laptop as part of the show. Thinner than the MacBook Air M2 at 11.3mm, the ASUS Zenbook S 13 OLED laptop is extremely lightweight at just 1kg.
• Asus Republic of Gamers (ROG) also announced its latest gaming smartphone, the ROG Phone 8 series, featuring a Snapdragon 8 Gen 3 processor and AI functions. Its AI Grabber feature can directly extract text from games, while its Semantic Search enables contextual searches within the user’s photo album on their device using keywords.
• Dreame used CES 2024 to release the Robotic-mower A1, a lawn mower that can assess its surroundings and intelligently identify objects it encounters. The A1 saves homeowners hours of time, the company says, and features patented high-precision 3D laser sensor technology, an OmniSense 3D ultra-sensing system, and a U-Path mowing plan program. With centimeter-level positioning, the company claims effective mowing is guaranteed.
• BOE is showcasing its game-changing automotive display technologies, such as the oxide TFT, flexible OLED, 8K, Mini LED, and BD Cell, at the fair. In terms of oxide TFT (thin-film-transistor) technology, the company debuted the world’s first 45-inch 9K oxide TFT Mini LED display. Another innovation is the 14.6-inch 2.5K oxide TFT display, which boasts high transmittance, high contrast ratios, a wide color gamut, slim bezels, and high cost-effectiveness.
• Ecovacs, a robot vacuum company, is presenting a diverse range of products at CES 2024. These include the Winbot W2 Omn (a robot window cleaner), the Deebot X2 Combo (a wireless handheld stick vacuum designed for the Deebot X2 Omni), and a robotic lawn mower. The Deebot X2 Combo comes with upgraded hands-free capabilities and precision for cleaning floors, drapes, ceilings, and more, according to the company, which adds that their products enable users to “enjoy a fully automated era of whole-house cleaning.”

Context: In January last year, 493 Chinese companies took part in CES 2023, less than half the number from three years earlier, according to South China Morning Post. The absence of leading Chinese companies at the time was attributed to geopolitical tensions and pandemic-related travel restrictions.

After a more than $80 billion market value wipeout since last January, Meituan on Wednesday spent $51 million (HK$399 million) on its first share buyback since it listed in Hong Kong, in a bid to support investor confidence in the company’s resilience amid fierce competition in a local life sector replete with fresh entrants.

Why it matters: Meituan’s first share buyback since going public more than five years ago comes after executives warned of a slowdown in its main takeaway business in the fourth quarter and as Douyin, China’s TikTok sibling, swoops into its business segments. 

Details: The food delivery service provider bought back a total of 5.63 million Class B shares, costing an average of HK$71.07 each, according to its latest filings. Meituan’s stock price responded by rising 5.4% today in Hong Kong.

• Meituan announced in late November that it planned to repurchase shares on the open market beginning Dec. 1, anticipating a total buyback of up to $1 billion in the near future.
• Last year, the firm’s Hong Kong-listed stock slumped by more than half and dropped 82% from its 2021 peak. The trading price is unlikely to return to this peak in the short term as investors worry about ever tighter competition from ByteDance-owned Douyin.
• CEO Wang Xing, however, said in the firm’s latest earnings call that he believed Meituan was “undervalued at the current share price,” expressing confidence about the business he co-founded’s “long-term growth and value.”
• As of Sept. 30, Meituan held cash and cash equivalents of RMB 25.1 billion, its quarterly results showed.
• Meituan has yet to achieve consistent quarterly profitability, but like other Chinese tech companies, it is also seeking to expand business outside of mainland China, an endeavor which is still at the “investment stage,” according to Wang. Meituan’s sister app KeeTa has risen to become the second-largest food delivery platform in Hong Kong since its launch in May.

Context: Besides Meituan, China’s most valuable tech firms including Alibaba and Tencent have exhibited a downward trend in share price that has lost them hundreds of billions of dollars since their peak around 2021. Alibaba and Tencent conducted record buybacks last year, with e-commerce giant Alibaba repurchasing $9.5 billion of ordinary shares, and WeChat owner Tencent spending a total of HK$48.429 billion on buybacks in the same period, meaning the latter topped the Hong Kong stock market’s repurchase list.

Just as German majors once did in the gasoline-powered vehicle segment, Chinese carmakers are beginning to jointly build a reputation for luxury in the electric vehicle segment in their home country, according to Paul Gong, head of China autos research at UBS.

Why it matters: The comments point to a dramatic shake-up in the world’s biggest auto market as once-dominant foreign car brands lose ground while Chinese counterparts such as BYD and Li Auto have risen over the past year, often in step with each other. 

• Notably, Chinese status-conscious buyers are coveting local luxury-styled cars which have enjoyed a medium-to-high single-digit increase in average selling prices each year over the last decade, Gong told reporters in Shanghai on Tuesday. 

Details: China’s new cohort of EV makers have tended to sell pricier than average cars packed with high-tech features, inspiring their more established counterparts to improve their offerings and resulting in a positive net effect on all of the companies’ profiles, Gong said, pointing to “synergies” similar to those of the German majors in the fossil-fuel car era. 

• The “glass ceiling” of China-made car prices is being shattered, according to the Swiss bank, as Chinese EV models have gained popularity, especially models in the price range between RMB 200,000 and RMB 300,000 ($27,880-$41,820).
• However, it remains challenging for them to go further upscale into the super-premium segment where a car could be priced at RMB 1 million ($140,000), Gong added, citing a lack of confidence in luxury Chinese brands among older Chinese consumers.
• UBS projected that Chinese automakers will account for close to two-thirds of China’s passenger car sales in 2024, up from 56% a year ago, while absorbing 41% of the overall profit pool, compared with 17% in 2022, boosted by higher selling prices. 
• Gong envisioned China could be big enough to allow 10-12 domestic carmakers to sell significant volumes with different success stories by 2030 in the best-case scenario, rather than just three to five as some had previously expected.
• Tesla, Volkswagen, General Motors, and BMW were the only international car makers last month to record sales of more than 10,000 new energy vehicles, mainly all-electrics and plug-in hybrids, according to figures from the China Passenger Car Association on Tuesday.

Context: Having struggled to cope with the ferocious competition of repeated price cuts, Chinese car brands such as the established BYD and new entrant Xiaomi have sometimes turned to collaborations to generate buzz and support on social media. 

• BYD showcased a dozen Chinese-branded EV models, including those of rival Li Auto, in a show of solidarity at its headquarters in Shenzhen last August, TechNode reported. Meanwhile, a video clip posted by BYD has racked up nearly 24 million views on Twitter-like platform Weibo, which looked back at the developments of major domestic carmakers. 
• Xiaomi launched an advertising campaign on several digital outdoor billboards in China’s four top-tier cities to show its respect to competitors including BYD, Huawei, and Xpeng Motors, before the pre-launch event of its first EV model last month. In a post on his Weibo account, chief executive Lei Jun called his rivals “pioneers of China’s new energy vehicle industry.”

On Monday, Oppo launched its Find X7 and Find X7 Ultra flagship smartphones in China, emphasizing their innovative camera features. The Find X7 Ultra stands out as the world’s first device to feature dual periscope zoom cameras with a 1-inch Sony LYT-900 sensor, and claims to have the largest telephoto sensor ever integrated in a smartphone. With the Find X7 Ultra, Oppo also becomes only the second domestic brand after Huawei to offer a satellite phone function.

Why it matters: Oppo is hoping to capitalize on consumer excitement for new technology at the dawn of 2024, seeking a competitive edge by introducing hi-spec innovations at a time when China’s mobile phone market is increasingly saturated.

Details: The Find X7 Ultra debuts Oppo’s quad main camera and advanced 1-inch Sony LYT-900 sensor, combining breakthroughs in camera hardware with its HyperTone camera system and pro-grade Hasselblad tuning.

• The Find X7 Ultra packs in four 50MP main cameras, including two equipped with a periscope zoom lens, bridging the zoom gap between optical focal lengths. The 50MP 3x periscope zoom camera features a 1/1.56” Sony IMX890 sensor, an f/2.6 aperture, and a 65mm focal length. This sensor is approximately three times the size of cameras found in major competitors’ phone systems, with Oppo claiming it as the largest telephoto sensor in any smartphone currently on the market.
• The wide camera features an advanced second-generation Sony LYT-900 1-inch sensor, touted as having improved power efficiency compared to its predecessor. With a customized lens with an f/1.8 aperture and optical image stabilization (OIS), it also promises a 50% reduction in reflection, all at a versatile 23mm optical focal length.
• When users need to zoom out, the ultra-wide camera comes into play with its 50MP Sony LYT-600 sensor. This camera delivers expansive and detailed shots at a focal distance of as near as 4cm, thanks to its large size focal length and fast f/2.0 aperture, according to Oppo.
• The Find X7 Ultra also includes software additions like the HyperTone Image Engine, giving users advanced computational photography options and features for high-quality photos.
• The flagship is equipped with Qualcomm’s Snapdragon 8 Gen 3 processor, featuring a large 5,000mAh battery capable of fast 100W wired charging and 50W wireless charging. Its 6.82-inch display offers a 1440p resolution, a maximum refresh rate of 120Hz, and a peak brightness reaching 4500 nits for HDR content.
• The Find X7 Ultra will be available in three colors: black, blue, and brown. Currently, the phone remains exclusive to the Chinese market, with no release planned for Europe or the US. Prices start at RMB 5,999 ($845) for a model with 12GB of RAM and 256GB of storage, going up to RMB 6,999 ($986) for 16GB of RAM and 512GB of storage.

Context: In the third quarter of 2023, the global smartphone market fell 1% year-on-year, to 299.8 million units sold, according to research firm Counterpoint. Today’s top five global phone brands are Samsung (with a 20% market share), Apple (16%), Oppo (14%), Xiaomi (14%), and Vivo (7%).

Geely on Jan. 5 launched the first battery electric sedan under its mainstream luxury marque Galaxy, which the Chinese automaker hopes will take the crown from the likes of the BYD Han to become China’s best-selling model in the mainstream sedan segment. 

“We are aiming to see the Galaxy E8 take pole position as a top-seller against the backdrop of increasing competition in the Chinese mainstream car segment,” Jerry Gan, chief executive of Geely Automobile Group, said in an interview after the launch event (our translation). The company did not provide specific sales targets, citing fluctuations in the market. 

Volvo’s parent is looking to carve out a significant piece of China’s increasingly crowded medium-to high-end car segment. Approximately 65% of the new EV models debuted at November’s Guangzhou Auto show were priced between RMB 200,000 and RMB 300,000, including the Galaxy E8, its sibling Zeekr 007, and BYD’s Sea Lion, Jefferies analysts wrote in a research note dated Nov. 28. 

BYD’s Han was 2023’s most popular electric sedan in the price segment with sales of more than 200,000 units. Geely posted sales of 83,497 vehicles under its Galaxy marque as of December, after deliveries began last June. It began deliveries of the E8 on Jan. 5 and has two other plug-in hybrid models for sale in the lineup, the L7 crossover and the L6 sedan, priced from RMB 138,700 and RMB 115,800, respectively. 

Below are five key factors that Geely hopes will carry the Galaxy E8 sedan to success:

Pricing: The Galaxy E8, a five-meter-long flagship sedan, starts at RMB 175,800 ($24,612), which is RMB 34,000 below the base price of the BYD Han EV, and RMB 6,000 lower than the smaller, hybrid Toyota Camry. Its all-wheel drive version is priced at RMB 228,800 and additionally features an 800-volt system for fast charging and acceleration from 0 to 100 km/h (62 mph) in 3.49 seconds. 

Smart cabin: Like its homegrown rivals, Geely has packed the luxury-styled but affordably priced sedan with technologies such as Qualcomm’s latest five-nanometer cockpit processor 8295, as well as a massive 45-inch wide 8K dashboard screen made by Chinese display manufacturer BOE. This makes the E8 probably the cheapest model that enables users to play hit gaming titles such as Asphalt in-car. By comparison, the 2025 Toyota Camry hybrid, which started pre-sales at RMB 181,800 in China on Jan. 1, is powered by Qualcomm’s previous 8155P processor. 

Performance: The single-motor E8 has a power output of 200 kW and is equipped with a 62-kilowatt-hour battery pack, offering a driving range of 550 kilometers (342 miles), while the entry-level BYD Han is fitted with a 60.5 kWh battery and a 150 kW motor. The top-end version of the E8 boasts 800-volt fast charging that potentially adds 180 km on a five-minute charge; for comparison, all the variants of the more premium Zeekr 007 offer an additional 610 km from a 15-minute fast charging session. 

Exterior: The capacious midsize sedan comes with a “ripples of light” design element, featuring an aesthetic front end with a 1.1 square foot illuminated graphics area comprising 158 micro-lights that can be programmed to display “over 100 different light shows,” according to Geely. It also has an aerodynamic design with frameless doors and concealed door handles, on  a 2,925-millimeter-long wheelbase, making it slightly larger than the BYD Han.

Satellite assistance: The E8 is one of the incoming models that could provide satellite call services in areas with no cellular or WiFi signal. Geely said it will launch a further 11 telecommunication satellites into low orbit in February, following the successful launch of its first nine satellites more than a year ago, geared towards offering high-precision navigation for its self-driving cars, reported Reuters.

TikTok is seeking to significantly expand its e-commerce business in the US, with plans to achieve a tenfold increase in merchandise sales in the world’s largest economy this year, a target of $17.5 billion, Bloomberg reported on Thursday, citing unnamed sources.

Why it matters: TikTok’s ambitious goal will see it push harder to redirect users’ attention from short videos to in-app shopping in a potential threat to established US e-commerce giant Amazon. The move also signals that the ByteDance-owned short video app, which has 150 million users in the US, will compete more directly with its Chinese counterparts Temu and Shein in 2024.

Details: The global value of goods sold on TikTok was expected to reach around $20 billion last year, according to Bloomberg, with its Southeast Asian platforms contributing the bulk of these sales. Singapore-based research company Momentum Works projected in mid-2023 that TikTok Shop was poised to capture a 13.2% share of the Southeast Asian e-commerce market by the year’s end.

• The highest selling products on TikTok Shop are mainly those that more easily lend themselves to promotion by video, such as clothing and beauty items, while its competitors offer a broader range, from kitchen utensils to digital products.
• Shortly after TikTok Shop went live in the US in September, the hit social media platform experienced early success at its first Black Friday and Cyber Monday events, with the major shopping days seeing more than 5 million new customers from the US make purchases on TikTok.
• Meanwhile, TikTok announced this week that transaction fees for merchants in most product categories will increase to 6% of each sale starting in April, and by July, these will rise again to 8%. TikTok Shop currently charges a commission of 2% plus 30 cents per transaction. The change is likely to have an impact on profit margins for store operators.

Context: Since its initial trial in 2021, TikTok’s foray into e-commerce has sought to replicate the proven path taken by its Chinese counterpart Douyin in the online retail field, guiding loyal users previously attracted by viral short videos to engage in shopping on the platform. 

• Indonesia, the first country in which TikTok Shop launched, banned online shopping on social platforms in September, pointing to the protection of small businesses and user data, and forcing TikTok Shop to suspend operations. Despite this setback, TikTok quickly made a comeback in Southeast Asia’s most populous nation through a deal with local company GoTo backed by a $1.5 billion investment.

US chip giant Nvidia is gearing up to mass produce a range of AI chips including its H20 model for China in the second quarter of 2024, with Taiwanese electronics manufacturer Wistron picked as the major supplier of these GPU (graphics processing unit) substrate orders, according to US media outlet Wccftech.

Why it matters: Despite the US government’s ban on high-performance AI chip exports, Nvidia has developed modified AI chips for the Chinese market and is ready to ship limited sales of less powerful AI chips to China as long as they adhere to regulatory standards.

Details: Nvidia is modifying its latest AI chips specifically for the Chinese market, including the HGX H20, L20 PCle, and L2 PCle. The three chips are based on the Nvidia H100, but allow the company to comply with the latest US export control policies announced last October.

• Nvidia originally planned to start selling a modified version of these AI chips by the end of 2023, but postponed the launch to early 2024 as the China-US chip war escalated, the Wccftech report said. 
• Since then, the US government has adopted a softer stance on commercial sales in China, and Nvidia has assured the government that their chips will fully meet compliance guidelines established by US trade and commerce authorities. Last week, Nvidia launched its China-exclusive GeForce RTX 4090D, a less powerful version of the flagship RTX 4090 GPU it sells elsewhere.
• The H20 AI chip is a scaled-down version of the H100 GPU, equipped with 96 GB memory capacities that operate at speeds of up to 4.0 Tb/s, according to Nvidia. It offers computing power of 296 TFLOPs and a performance density of 2.9 TFLOPs/die, in contrast to the H100’s 1,979 TFLOPs and 19.4 TFLOPs/die.

Context: Last October, the US government issued a new ban, further restricting the export of high-performance AI chips by Nvidia. Subsequently, the chip giant announced an immediate halt to the shipment of its A100, A800, H100, H800, and L40S products.

• In December 2023, during an interview with Reuters, US Secretary of Commerce Gina Raimondo stated that the government was in discussions with Nvidia about allowing the chip firm to sell AI chips to China under certain conditions. Raimondo emphasized that the government would stop Nvidia from exporting its most complex and powerful AI chips, but would not curb its chip sales to China altogether. 

China’s two largest bubble tea chains Mixue and GoodMe both filed prospectuses for Hong Kong listings on Tuesday, with the aim of broadening the companies’ financing access through share sales, providing vital support for the new-style tea brands to navigate an extremely competitive industry.

Why it matters: Three China-founded beverage retailers have now lined up to apply for IPOs in Hong Kong in less than five months, incluing fruit tea chain ChaBaiDao submitted its application last August, signaling that the industry leaders are betting big on store expansion and tea consumption in China’s delayed post-Covid economic recovery.

Details: Mixue, which also sells ice cream for RMB 2 (less than $0.3) per cup, generated RMB 15.4 billion ($2.17 billion) in revenue and recorded a net profit of RMB 2.5 billion in the first nine months of last year. Mixue’s numbers are nearly triple those of rival GoodMe on both metrics.

• With an eye-catching snowman logo, Mixue boasted 32,180 stores across China as of September 30, 2023, with over 55% of those stores in third-tier and below cities. GoodMe, a 13-year-old brand selling bubble tea mainly in second-tier and below cities, had opened a total of 9,001 stores by the end of 2023.
• The primary revenue streams for Mixue and GoodMe are driven by the sales of raw materials and equipment to franchisees; the former has derived over 98% of its income from this strategy in the past three years.
• According to GoodMe’s prospectus, revenue from directly operated stores in the first three quarters of 2023 accounted for only 0.1% of its total, while the income from selling goods to franchisees made up as much as 75%.

Context: Mixue shifted to exploring a Hong Kong IPO instead of a mainland China listing due to a lack of progress following a proposed RMB 6.5 billion Shenzhen IPO filing back in 2022. The tea chain’s decision to put its mainland listing on hold is widely seen as a sign that Chinese regulators have imposed strict rules discouraging companies that rely heavily on franchise business models from listing.

Top Chinese automakers BYD and Geely on Monday reported record sales of electric vehicles in 2023 on the back of year-end momentum from their home turf and strong shipments to overseas markets, as China’s booming industry ramped up its push for global expansion.

Why it matters: The latest sales figures come at a time when China is set to surpass Japan to become the world’s largest car exporter, according to estimates by the China Association of Automobile Manufacturers (CAAM)  as reported by Nikkei, buoyed by a growing demand for green energy vehicles worldwide.

• Exports of new energy vehicles, mainly all-electrics and plug-in hybrids, grew 83.5% year-on-year to almost 1.1 million from January to November, while internal combustion engine vehicles remain the major export commodity, accounting for 75% of China’s total car shipments abroad, according to CAAM.

Details: BYD posted record sales at more than 3.02 million EVs in 2023, marking 62% growth from a year ago and putting the Chinese carmaker in pole position to retain its title of the biggest-selling EV brand in the country. In particular, exports surged 334% to 242,765 units compared with the previous year, with the company now having established its footprint in more than 70 countries.

• Sales of SAIC-GM-Wuling, General Motors’ minicar joint venture in China, also reached a record high of 1.4 million units, of which 211,512 were overseas exports, representing a 9% year-on-year growth. The automaker currently sells its budget models including Mini EVs in Southeast Asian countries such as Thailand, Vietnam, and Indonesia. 
• Geely said its EV sales rose 48% year-on-year and were also record-breaking last year, at 487,461 units, including 274,101 gas-powered and green energy vehicles abroad. Its premium EV brand Zeekr delivered 118,685 units over the year, up 65% year-on-year but missing its delivery goal of 140,000 units set earlier this year. 
• GAC’s EV unit Aion was also around 20,000 units short of its annual delivery target of 500,000 EVs, closely followed by Changan Automobile at more than 470,000 units. Huawei’s manufacturing partner said overseas shipments grew 35.4% to roughly 230,000 units, as construction of its overseas production base started in Thailand last month. 
• Li Auto maintained its solid momentum throughout the year as it reported deliveries of 50,353 plug-in hybrid crossovers in December, bringing the company’s total deliveries for the year to 376,030. Young EV makers such as NIO and Xpeng Motors are catching up with annual deliveries of 160,038 and 141,601, respectively. 
• SAIC-Volkswagen, the joint venture of the Wolfsburg-based automaker and China’s state-owned automaker, said it became the most visible player among its peers with sales of almost 110,000 units of its China-made ID family electric models. The German automaker in July reportedly cut the price of its ID.3 hatchback by more than 20% to RMB 125,900 ($17,500).

Context: CAAM expected car sales in China to reach the threshold of 30 million units for the first time in 2023 and that number will be further increased to 31 million in 2024, Caixin reported. NEV sales are set to total 9.4 million units in 2023, up 37% from a year earlier. The growth rate could slow to 22% in 2024, however, as the domestic EV market is maturing.

Xiaomi held its most significant media event of the year in Beijing on Thursday: the debut of its first electric car. With a size comparable to the BMW 5 Series and a shape similar to the Porsche Taycan, the four-door sedan boasts some of the Chinese car market’s highest specifications, as cut-throat competition from maturing rivals rises.

The sleek, gadget-full all-electric sedan is aiming to become a top choice for China’s increasingly tech-savvy consumers, and certainly aroused widespread curiosity judging by the more than 46 million people who logged on for the three-hour-long unveiling on the country’s Twitter-like site Weibo. Yet from journalists and insiders alike, the reaction was mixed. 

From the event, TechNode has selected some of the car’s highlights. 

Main specs

The high-performance SU7 can sprint from 0 to 100 km/h (62 mph) in 2.78 seconds, as it climbs to a top speed of 265 km/h. It is claimed to be the world’s most aerodynamic production car with a drag coefficient (Cd) of 0.195. By comparison, the Taycan Turo can hit 260 km/h and Tesla’s Model S has a Cd of 0.208. It also comes just a month after rival Huawei launched the Luxeed S7 sedan at 0.203Cd. 

Xiaomi said it uses two 9,100-ton mega casting press machines to produce the front and rear underbody pieces, giving the car a torsional stiffness of 51,000 Nm/degree, nearly twice the number of the Ford F-150 Raptor and higher than any other car on the road. The technology, first adopted by Tesla, has since been embraced by Chinese EV makers from Geely-affiliated Zeekr to Huawei-backed Aito.

Vehicle autonomy

Xiaomi’s chief executive Lei Jun presented aspects of the company’s self-driving initiative for public viewing, highlighting that the premium version of the SU7 will incorporate two Nvidia Drive Orin processing chips plus a laser sensor unit on the car’s roof to carry out certain partially autonomous driving functions. Xiaomi also showed a short video of the car drawing into a tight garage space autonomously.

The Chinese tech company has set a goal for its advanced driver assistance software to be available to drivers in 100 major Chinese cities by the end of the next year, according to Lei. Huawei and Xpeng Motors are for now the leaders of this booming market, with established carmakers from BYD to Great Wall Motor trying to catch up.

Smart cabin

The SU7 will be the latest Chinese car model powered by Qualcomm’s smart cockpit computing platform SA8295, after the Zeekr 001 FR and its sibling Jiyue 01, and its infotainment system will turn on in just 1.5 seconds. It is also integrated seamlessly into the Xiaomi ecosystem with the adoption of the company’s self-developed operating system, the HyperOS, which takes only 30 minutes or so to carry out important updates, according to the company. 

CEO Lei said the SU7 would create the same smooth experience that anybody with a Mi Phone is used to, as various apps are pushed from their phones to a 16.1-inch in-car dashboard once they sit in the car. Other devices, from tablets to home appliances, also seamlessly work with the vehicle, an integration trend led by auto and tech majors such as Huawei, Geely, and NIO.

Conclusion

Xiaomi will have to pick an appropriate price tag, given it starts with a somewhat broad, unclear positioning, said You Xi, a seasoned economic and financial writer and co-founder of Chinese online media platform Communication Planet. “It remains challenging for the company to extend its brand into EVs,” You added, citing similar offerings from multiple competitors among his reasons (our translation).

The smartphone giant plans to introduce two variants of the SU7 to “contemporary elites with taste in lifestyle and technology” in China over the next few months, said Lei. Some experts have predicted the premium version of the car, with an estimated driving range of 800 kilometers (497 miles), could cost consumers at least RMB 300,000 ($41,124).

China imported 42 lithography systems (chip-making equipment) with a total value of $8.168 billion in November, mostly from the Netherlands and Japan, according to South China Morning Post. Included among them were 16 lithography machines imported from the Netherlands valued at $7.627 billion, representing a year-on-year increase of 1,050% in value of such equipment from the European chip machinery powerhouse.

Why it matters: Lithography machines are a core type of equipment in chip manufacturing, with advanced models available only at extremely high cost. The Chinese demand for lithography machines is increasing rapidly as the domestic semiconductor industry is being boosted in an effort to offset the impact of tighter US chip export controls. At the high end, only a few companies worldwide are capable of producing them.

Details: China aims to stock as much advanced lithography equipment as possible before the Netherlands’ export restrictions come into full effect in January 2024. 

• Among the 42 lithography machines imported by China in November, 16 are from the Netherlands’ ASML, the world’s largest lithography machine manufacturer, as reported by SCMP. 15 machines are from Japan’s Canon and Nikon, while the remaining 11 are reported to have come from second-hand equipment dealers in other countries.
• Although the quantity of lithography machines imported from the Netherlands in October was higher at 21 units, the total value was only $672.5 million, significantly lower than the total value of $7.627 billion for the 16 lithography machines imported in November, an average 46% more.
• The monthly unit price difference suggests that Chinese companies are continuing to acquire more advanced chip-making systems despite the US’s attempts to limit such purchases, according to SCMP. 
• Most of the equipment shipped in November obtained approval from the Dutch government by the end of 2022 or early 2023, said Jan-Peter Kleinhans, director of technology and geopolitics at Stiftung Neue Verantwortung, a German non-profit think tank based in Berlin. ASML’s lead time in 2023 was around 18 months, indicating that equipment shipped in the fourth quarter of 2023 would have been ordered in either the second or third quarter of 2022, he added.

Context: In June this year, the Netherlands announced export controls, placing restrictions on the shipment of ASML’s chip-making machines to China. Starting from September 1, ASML has been required to acquire a license for the export of its deep ultraviolet (DUV) lithography systems to China.

• Following the new rules, ASML announced that its existing licenses allowed it to continue shipping DUV lithography machines to China until the end of 2023, despite export restrictions in the Netherlands taking effect from September. 
• ASML’s export licenses necessary for shipping these systems to Chinese customers will become invalid from January 1, 2024, and are unlikely to be renewed.
• As of 2021, domestically manufactured lithography systems made up less than 5% of those used in Chinese fabs, according to SCMP’s report.

Alibaba’s China-focused online shopping platform Taobao is streamlining its refund process, in a move that mirrors rival Pinduoduo’s strategy for retaining customers.

The new rules for handling refund issues took effect on Tuesday, allowing the platform to use big data analysis of store quality and complaint frequency to handle returns and refunds directly when buyers make after-sales requests that meet certain conditions.

Why it matters: This update brings Taobao’s after-sales mechanism closer to that of rival Pinduoduo, with the company emphasizing a commitment to consumer rights and cutting the influence of merchants in the refund process. 

Details: Pinduoduo’s “Refund only” strategy has met with controversy in recent years. The approach, coupled with Pinduoduo’s consistent low-price strategy, has attracted a large number of price-sensitive consumers. Merchants on the other hand have come to find the platform’s rules too strict, generating widespread dissatisfaction.

• According to Taobao’s new rules, if a seller exceeds the agreed-upon delivery time or sends goods without the buyer’s consent, the system will allow the buyer to request a refund automatically. The platform also lets buyers apply for a refund if they refuse to sign for a delivery on arrival. Previously, refunds had to be processed via the seller.
• Taobao is providing a quick appeals channel for merchants however, permitting them to appeal refunds within a 30-day period.
• One merchant who sells on multiple platforms told local outlet Jiemian that shoppers have upped their expectations of e-commerce platforms since experiencing how simple it was to apply for a “refund only” on Pinduoduo, the domestic sibling of runaway e-commerce success Temu.

Context: In recent weeks, Alibaba executed an executive level overhaul at Taobao, its most-profitable Chinese e-commerce group. Alibaba CEO Eddie Wu tapped six young leaders to take charge of key operations at twin e-commerce sites Taobao and Tmall, after he took the reins of the business on Dec. 20.

• The flurry of adjustments follow publication of an employee memo by founder Jack Ma in which he wrote “I firmly believe Alibaba will change and reform.” 

The US game developer Activision Blizzard, which has recently been in discussions with several domestic game companies regarding the revival of its Chinese service after a one-year absence, has decided to re-establish collaboration with Chinese game publisher NetEase, as reported exclusively by local media outlet 36Kr.

Why it matters: The split between NetEase and Blizzard was a major event in the gaming industry this year. On Jan. 24, 2023, the Chinese servers of Blizzard’s gaming platform were shut down, ending the World of Warcraft publisher’s 15-year partnership with NetEase in China. On Monday, most domestic gamers were shocked to hear about the potential revival of cooperation between the two gaming giants, especially after their previous relationship ultimately ended in acrimony.

Details: The relaunch of Blizzard’s games in China may have to wait for at least six months, as NetEase and Blizzard need to rebuild their domestic operations team and test the new servers after once any new deal is confirmed, according to 36Kr. 

• The return of Blizzard suggests a full restoration of gaming titles under its brand in mainland China, including World of Warcraft, Hearthstone, Warcraft III: Reforged, Overwatch, the StarCraft series, Diablo III, and Heroes of the Storm.
• News of Blizzard’s return instantly topped the trending topics chart on Twitter-like platform Weibo on Monday, with Chinese players expressing their shock at the quick reunion. NetEase declined to comment on the story, while Blizzard China stated that the company currently does not have any information or updates to share, according to Sina Tech.
• NetEase Dashen, a gaming community app, has begun to gradually update with new content on World of Warcraft since Dec. 20, as reported by Southern Metropolis Daily. Additionally, the app no longer displays previous news items regarding NetEase’s discontinuing of the operation of World of Warcraft.
• Blizzard has also been in contact with several other major Chinese gaming companies this year, including Tencent, ByteDance, and Bilibili, regarding the takeover of its domestic service, according to Cailianpress. Tencent denied the possibility of a deal, while ByteDance is currently preparing to sell its entire gaming sector, making a move highly unlikely. As for Bilibili, the performance of its games business is not very satisfactory at present, the report claimed.

Context: Blizzard announced in November 2022 that it would suspend its game services in China due to the expiration of its licensing agreements with NetEase. However, Microsoft’s acquisition of Blizzard this year and the upcoming resignation of Blizzard’s CEO have brought about a turning point in the relationship between Blizzard and NetEase.

• Bobby Kotick, the CEO of Blizzard, will resign from his position as the leader of the video game company On Dec. 29, as communicated in an internal memo from Phil Spencer, the CEO of Microsoft Gaming. The leadership transition was expected after Microsoft’s completion of the $69 billion acquisition of Blizzard in October, as reported by CNBC.

Chinese EV maker NIO on Dec. 23 unveiled a long-wheelbase executive sedan model, the ET9,  with a price range of $112,160. The model boasts its own self-driving chip, marking the first utilization of the five nanometer process technology in China’s auto industry. 

The four-door executive flagship, equipped with proprietary technologies such as a sophisticated yet lightweight chassis system and a superfast-charging battery pack, reflects NIO’s commitment to redefining the upper premium vehicle market, William Li, the company’s founder, chairman, and chief executive, told press at the annual NIO Day event on Dec. 23. Li further referred to the target segment as ”a spiritual home base“ for international luxury carmakers (our translation). 

With a pre-sale starting price of roughly RMB 800,000 ($112,160), NIO’s answer to the Porsche Panamera could serve as a low-volume halo car and is scheduled for delivery in the first quarter of 2025. Larger rivals from BYD to Geely have also launched similarly-priced offerings, indicating their aspirations to upscale and grab a slice of the luxury market.

Here are some of the key specifications of the ET9 presented by NIO at the company’s annual gathering held in the northwestern Chinese city of Xi’an. 

Design highlights: Different from old-money cars that Western brands typically offer, the NIO ET9 features a sleek and contemporary look with high ground clearance, large 23-inch wheels, and cutting-edge gadgets such as laser sensors on the roof and sides for an all-round view of the car’s surroundings. 

• The interior boasts a modern design language. The car features an almost two-meter (six-feet) console that extends through the length of the cabin and is integrated with equipment such as a 10L fridge and folding tables, offering passengers first-class-style seats and comfort.
• The grand tourer measures 5.3 meters in length and 1.6 meters in height with a wheelbase of nearly 3.3 meters, making it longer than the Bentley Flying Spur and almost as tall as a regular off-roader. The back seats can be reclined as much as 45° and come with full-body massage programs. 

Autonomous driving: The ET9 will be powered by NIO’s first self-developed system on chip (SoC), the Shenji NX9031, for partially automated driving. NIO stated it will be the first Chinese automaker to use chips with five-nanometer process technology, providing its vehicles a computing power comparable to the combined total of that created by four industry-leading processors. 

• By comparison, NIO’s existing lineups are equipped with four Nvidia DRIVE Orin chips that handle up to 1,016 TOPS on seven nanometers. The purpose-built chip is a strategic move as it could improve processing efficiency and machine learning algorithm coupling for autonomous driving, Jefferies analysts said on Monday. 
• Li declined to provide further details about the semiconductor. Tesla has reportedly turned to Taiwan’s TSMC to produce its next-generation full self-driving (FSD) computer on 4/5 nm processes. Homegrown rivals Li Auto and Xpeng Motors are also developing their own chips for vehicle intelligence. 

Large cylindrical battery: The ET9 will incorporate NIO’s in-house developed, 46105-type cylindrical lithium-ion battery cells. This implies a size of 46 millimeters in diameter and 105 mm in length with a cylindrical shape, a technology also embraced by Tesla in the hopes of increasing ranges and lowering costs. 

• NIO asserts that its new batteries have a cell-level energy density of 292 watt-hours per kilogram (Wh/kg), and a 120 kWh pack can provide a range of 255 kilometers (159 miles) after five minutes of charging at a 5C rate, facilitated by a 900-volt electrical system. By comparison, CATL’s latest Qilin battery would allow Li Auto’s Mega van to cover 500 km on a 12-minute charge at a 5C rate. 
• NIO did not reveal many further details, except for Li’s comments to investors during a Dec. 5 earnings call stating plans to outsource battery manufacturing for reduced investment and improved margins. The EV maker is reportedly in talks with Great Wall Motor-backed Svolt to set up a joint venture for making batteries in its car manufacturing base of Anhui. 

Smart chassis: NIO also launched an intelligent chassis suspension system which the company claimed would provide a refined driving experience featuring a steer-by-wire system, rear-wheel steering, and adjustable suspension altogether for the first time in a mass-produced consumer car.

•  NIO said the so-called SkyRide Intelligent Chassis System, in combination with hydraulic components, could be raised or lowered by 50 millimeters in one second to help passengers in and out of the car. In April, BYD introduced a similar offering that could automatically adjust to different road conditions and driving styles.
• In a 50-second video clip presented by NIO on Dec. 23, an ET9 prototype offered an apparently smooth ride when driving over multiple speed bumps and showcased a four-tier tower of Champagne glasses on the front body panel which remained in place despite the road surface. The flagship sedan is also highly maneuverable with a turning radius as low as 5.45 meters, a record also achieved by Xpeng with its upcoming X9 van.

Huawei is doubling down on electric vehicles with plans to run as many as 800 showrooms in China next year dedicated to the joint car brands that it has launched with manufacturing partners, aiming to become a more visible player in the world’s biggest auto market. 

Why it matters: The new shops, expected to present a broader portfolio with larger spaces compared to Huawei’s current policy of showcasing vehicles in its regular appliance stores, will allow Huawei to display models and arrange test drives for more potential buyers. They will also be part of a branding overhaul to enhance Huawei’s brand image as a major car tech company. 

• Huawei began selling EVs powered by its technologies and manufactured by partners via its sales network for smartphones in early 2021 under its “Smart Selection” approach, in which Huawei reportedly provides sales channels and has more control over vehicle development.

Details: In what could be the tech giant’s fastest period of growth in its history, Huawei is planning to operate 800 car showrooms next year and increase that number to 1,000 in 2025, people familiar with the matter told Chinese media outlet 36Kr. 

• Those new shops will feature a new brand called the Harmony Intelligent Mobility Alliance (HIMA), a collaborative initiative for carmakers and a rebranding of Smart Selection based on Huawei’s proprietary Harmony operating system. 
• Some of the smaller locations could start from 2,500 square meters, allowing six cars to be displayed in-store while also doubling as a delivery center with another six for-sale vehicles in parking spaces outside, according to a franchise disclosure document obtained by 36Kr. 
• Huawei’s preferred flagship stores require a wider area of 8,000 square meters or more, and the company is renovating some existing retail shops to showcase the new HIMA brand with improved layouts, according to the report. 
• Some existing locations do not showcase the newly launched Luxeed S7 due to limited space, the report said. Huawei currently has three models on sale in partnership with Chongqing-based manufacturer Seres and state-owned carmaker Chery. 
• Huawei did not respond to TechNode’s request for comment. 

Context: Sources added that a retail and distribution network of 800 shops next year will be comparable to that of Huawei’s major rival Li Auto, which operates nearly 400 direct-sales stores and 320 maintenance centers as of November. 

• Huawei is quickly expanding its EV lineup in collaborations with existing partners, which also include Changan and JAC. It is set to launch the M9, a full-size sports utility vehicle, with Seres at a price range of between RMB 500,000 and RMB 600,000 ($69,972-$83,966) on Dec. 26. 
• Aito, an EV brand set up by Huawei and Seres in December 2021, delivered nearly 19,000 vehicles in November on the back of strong order volume for its redesigned M7 crossover. It operated a network of 1,000 retail locations and service centers in 230 Chinese cities as of June. 
• Meanwhile, long-time rival Xiaomi is on track to launch its first EV model, the SU7, and is reportedly preparing showrooms for car sales with the first batch of display models expected to arrive early next year.

In the recently released 2023 EU Industrial Research and Development (R&D) Investment Scoreboard put together by the European Commission, Chinese tech giant Huawei has maintained its position among the top five global companies that made the highest R&D investments in 2022.

Why it matters: Huawei has been increasing R&D investment to strengthen its technological self-reliance in the face of US sanctions. This strategic move allows the telecoms behemoth to mitigate the impact of sanctions while preparing itself for long-term development amid geopolitical challenges.

Details: The European Commission’s report provides statistics on research and development (R&D) investment for the top 2,500 ranked companies. It indicates that these enterprises collectively increased their R&D expenditure by 12.8% in 2022 compared to 2021, reaching a record-breaking total of 1,249.9 billion euros. Although Huawei dropped one spot compared to the 2021 list but still secured fifth position, with an investment of 20.925 billion euros.

• In 2022, Huawei, TSMC (Taiwan Semiconductor Manufacturing Company), and CATL (Contemporary Amperex Technology Co. Limited) secured positions among the top ten in R&D investment within the Information and Communication Technology (ICT) sector. The ICT sector covers computing services, semiconductors, telecommunications, and multimedia.
• In 2022, Huawei invested 20.925 billion euros, with a year-on-year growth of 11%, while TSMC invested 4.985 billion euros, demonstrating a significant year-on-year growth of 31%. Meanwhile, CATL invested 3.072 billion euros, an explosive year-on-year increase of 110%.
• The top three countries represented on the list are the US, China, and Japan. The US leads with 827 companies on the list, investing a substantial 526.5 billion euros, while China follows closely with 679 companies who have allocated a total of 222 billion euros to R&D endeavors. Japan boasts 229 companies on the list, with a total R&D expenditure of 116.2 billion euros.
• In terms of distribution of R&D investment across regions, the US, China, and the European Union occupied the top three positions, securing shares of 42.1%, 17.8%, and 17.5%, respectively.

Context: The Chinese Academy of Engineering issued its list of 2023 Global Top Ten Engineering Achievements on Wednesday, with Huawei’s self-developed operating system HarmonyOS being recognized among them. The other nine selected achievements were ChatGPT, the Chinese space station, AMD’s Frontier (a supercomputer capable of 100 billion x billion calculations per second), the Baihetan hydropower station, the double-asteroid redirection test, the RTS,S/AS01 malaria vaccine, Spot & Atlas robots, lithium-ion power batteries, and unmanned aerial vehicles.

• In August 2023, Huawei released HarmonyOS 4.0 as a public beta version, in an effort to compete with Android and iOS. Currently, there are over 400 partners participating in co-building on and sharing of the technical foundation of HarmonyOS, according to Huawei. 
• Huawei plans to commence construction of its first European factory in France in 2024, as reported on Dec. 11. The facility is expected to focus on 4G and 5G equipment production, reinforcing Huawei’s presence in Europe.

Xiaomi said on Tuesday that it had sacked three employees for “spreading rumors” about plans for its electric vehicle business, as the company also said it was planning legal action over photos of its first car model leaked online by two media outlets. For months, multiple reports have circulated on Chinese social media featuring unauthorized confidential information about the smartphone maker’s EV business.

Why it matters: The news comes as Xiaomi, known for its low-cost pricing advantage in the smartphone market, has captured growing attention from Chinese netizens due to speculation of an imminent launch of its inaugural EV model, potentially heightening competition in the already low-margin sector. 

Details: The three employees were found by the company to have spread inaccurate information without permission during conferences hosted by brokerages and investment firms, severely misleading the markets and disrupting operations at Xiaomi’s EV division, the company said in a post on the Chinese Twitter-like platform Weibo. 

• Xiaomi is taking legal action against the trio, who have been dismissed for breaching the company’s code of conduct. 
• In addition, the smartphone maker is taking legal measures against two Chinese media outlets over allegations that their employees leaked images of its upcoming EV and violated their non-disclosure agreements with Xiaomi. 
• The Beijing-headquartered tech giant said it will continue to take action to ascertain liability for the alleged wrongdoings, including leaks and rumor-spreading. 

Context: A research note recently circulated on the Chinese internet and obtained by financial news agency Jiemian published what it said was “key information” regarding Xiaomi’s first EV, naming some of the suppliers for components such as the head-up display. 

• Xiaomi is also rumored to be set to debut the car at a press conference on Dec. 28, an influencer with the handle “Dianwankeji” wrote earlier this month on social e-commerce app Xiaohongshu. The company later said (in Chinese) that it has not decided yet on the event date.
• On Nov. 15, images of Xiaomi’s first consumer car along with key specifications were posted online for public review, as required by China’s Ministry of Industry and Information Technology, TechNode has reported. 
• More information revealed by China’s industry ministry last week showed that the premium version of the SU7 sedan will have a driving range of 800 kilometers, powered by a 101 kilowatt-hour (kWh) battery pack sourced from CATL. 

Shares of Gaotu, a Chinese online education firm, slumped nearly 20% on Monday as a previous influx of livestreaming viewers returned to rival East Buy’s Douyin channel after a recent screenplay dispute at the latter, which had driven users to seek alternative platforms, came to an end.

Why it matters: The 58% surge in New York-listed Gaotu’s share price last week has now been halved with the previous surge seemingly an exception that does not accurately reflect the sustainable growth prospects of Gaotu’s e-commerce business at present.

Details: China’s Gaotu was once a provider of after-school tutoring courses, but transitioned to the live commerce sector a year ago, in a similar move to East Buy, which found viral success after blending online language lessons with e-commerce. Gaotu witnessed eightfold growth in followers on Douyin in the last two weeks, taking it to almost 2.5 million followers on the TikTok sibling platform.

• The East Buy exodus began as a protest over a controversy surrounding Dong Yuhui, the most influential host on the platform. His fans were dissatisfied with the company’s Douyin account operator attributing a Jilin province screenplay read by Dong during a livestream to the collaborative efforts of the team. Fans insisted that Dong was the sole author and should be accredited as such.
• In the following days, Dong failed to appear on East Buy’s livestreams, prompting a large number of fans to flood rival Gaotu’s platform as a way of expressing their dissatisfaction with East Buy’s treatment of their live commerce idol. One user even stated, “I will only go back if Dong continues to appear in East Buy’s livestreams.”
• However, the week-long infighting came to an end on Monday night when East Buy CEO Michael Yu announced his decision to promote Dong to the position of senior partner in the company while committing to the establishment of a separate studio for the top influencer. That evening there were wildly contrasting figures for the two rivals: East Buy’s livestream featuring Yu and Dong saw them sell goods worth RMB 1 billion and hit a peak of 3.8 million simultaneous viewers; at the same time, Gaotu’s livestream had fewer than 5,000 viewers.

Context: Gaotu’s current stock price is still nearly 97% lower than its peak in 2021, when the Chinese government introduced a policy known as “double reduction” that dealt an unprecedented blow to private for-profit educational companies, and prompted them to seek rapid transformation to stay afloat. East Buy, a subsidiary of New Oriental, found unexpected success with a livestream last June as a host, who was once a tutor, taught English and simultaneously sold products, gaining significant attention on the internet.

• In November 2022, Gaotu was warned by the New York Stock Exchange as its stock price remained below $1 for 30 consecutive trading days. A month later, the company initiated its first livestream on Douyin under the name Gaotu Jiapin, mainly selling agricultural products and snacks. Its revenues for the third quarter were down by nearly 60% compared to 2020.

Unitop Fitness, a Chinese fitness equipment maker, unveiled the U-trainer Plus in September, at a price of $649. Our team was given a fortnight to review the home gym. 

The U-trainer Plus enables users to exercise on their own schedule with real-time performance tracking and built-in workouts. It eliminates the need for gym memberships and, despite this meaning the lack of a supportive fitness community, the personalized nature of the smart equipment enhances individualized training. 

Assembly at home

The difficulty of assembling home fitness equipment can vary widely depending on the type of equipment, the manufacturer’s instructions, and your own level of experience and comfort with assembling items.

The U-trainer Plus arrives in two relatively large, heavy  boxes.

The entire assembly process, including unpacking, reading the instructions, watching the assembly video, and manually assembling the equipment, took four hours. Although the fitness equipment includes installation tools, the tester, with limited assembly experience, still found the process somewhat challenging. For added convenience, it is recommended to have two people to work on the assembly together, especially since some parts of the equipment are quite heavy.

It’s also worth noting that the equipment takes up a sizable space in the home. Here are some of its basic specifications:

Packaging size: 1,445 x 490 x 275mm
Folded: 702 x 992 x 2,105mm
Expanded: 1,450 x 992 x 2,105mm
Net weight (main parts): 47kg
Gross weight (including accessories): 58kg
Resistance level: 100 levels
Maximum resistance: 50kg on each side
Resistance range: 2-50kg
Maximum weight capacity: 110kg

Customized app for home workouts

The U-trainer Plus comes with an app called Unitop, which features built-in programs and the option to customize workouts according to individual fitness levels and goals.

Through the app, users can establish a Bluetooth connection between their equipment and their chosen device, enabling them to choose from various training programs and set up personalized training plans. 

Different combinations of exercises, repetition rates, and the resistance weight of the equipment are all customizable. Each training exercise in the app comes with instructional videos and detailed explanations, providing assistance for beginners and alleviating concerns about confusion during workouts.

The equipment includes a barbell rod, wrist straps, handles, deltoid ropes, and a waist belt. Users have the flexibility to choose to use the appropriate accessories based on their individual training goals. However, some functions in the app require paid membership, and the one-year membership fee is an additional expense not included with purchase of the equipment.

Motivational partner mode

The U-trainer Plus offers adjustable resistance on both sides, enabling users to exercise together with friends or family members. Although this function was not tested during our two week trial, it is an interesting option for home fitness. Typically, exercising with friends or family is more motivating than working out alone.

Dual electromagnetic motors

The U-trainer Plus is equipped with dual electromagnetic motors, ensuring a friction-free workout experience without any physical wear and tear. It allows independent adjustment for each side, with the motors supporting 100 levels of resistance weight increments, precisely adjustable at 0.5kg per level. This enables users to train with a maximum resistance weight of 50kg on each side, totaling 100kg.

Workout at home with ease

The U-trainer Plus suits individuals who are seeking privacy, convenience, and a focused exercise environment at home. It enables users to engage in personalized workouts without the distractions or potential discomfort associated with public gyms. 

The equipment set seamlessly transitions between different functions, serving as a cable machine, a rowing machine, or a boxing machine. This provides users with the opportunity to engage in a comprehensive, low-impact workout that effectively targets a wide range of muscle groups throughout the body.

While home workouts offer convenience and flexibility, they may lack the social element found in traditional gym settings, which can serve as a significant source of motivation for some individuals. 

Therefore, the potential impact and value for money of this fitness equipment varies completely based on an individual’s personality, as some people may lack the motivation to exercise at home. While it provides virtual coaching and tutorials, it may not be a substitute for in-person guidance from a certified fitness professional, especially for beginners who need more personalized instruction and support.

Conclusion

The choice between using smart fitness equipment at home or going to a traditional gym depends on individual preferences, lifestyle, and fitness goals. It is essential to weigh the advantages and disadvantages to determine the best fit for an individual’s needs.

But the U-trainer Plus is suitable for fitness enthusiasts with a basic level of exercise awareness who enjoy working out at home. Beginners or those who prefer the atmosphere of a gym should carefully consider their purchase.

Pros:

Convenient and flexible at home option
Individualized training to fit different fitness levels
Customized app with built-in programs
Motivational partner mode
Dual electromagnetic motors
Comprehensive workouts targeting all muscle groups

Cons:

Assembly may be challenging for one person
Extra charges for certain features in the app
Lack of social element compared with traditional gyms
Challenging for beginners who need in-person guidance

Chinese EV brand Zeekr on Thursday announced the launch of a fast-charging, affordable, lithium iron phosphate (LFP) battery capable of running 500 kilometers (310 miles) on a 10-minute charge, becoming the latest automaker to seek more self-reliance and better cost control over the critical EV component.

Claiming to be the world’s first LFP battery with an 800-volt electrical system for fast charging, the so-called Gold Brick battery features a faster recharging speed than some of the most advanced offerings from established battery suppliers such as CATL and BYD. CATL’s latest Shenxing battery adds 400 km on a 10-minute charge. 

The decision by Zeekr to make its own EV batteries is one of the clearest examples of the Geely-owned brand’s determination to have greater control over its EVs’ core technologies, Chief Executive Andy An told a press conference in the eastern city of Quzhou on Thursday. 

Here’s what Zeekr’s management said about the battery and its production plan: 

Gold Brick battery: The blade-shaped LFP battery will be first equipped for the entry-level version of the Zeekr 007, the brand’s first battery electric sedan with a pre-sale price of RMB 224,900 ($31,059), offering a driving range of 688 km on a single charge. 

• Zeekr’s new batteries have a cell-level energy density of 250 watt-hours per kilogram (Wh/kg) and reach 128 Wh/kg at a system level. The company said it can fit more battery cells into a given space, which enables more energy density and requires fewer connection components. 
• For comparison, CATL’s other most recent battery, Qilin – which is packed with more expensive nickel and cobalt-based cells – reaches 255 Wh/kg at a system level and can power an EV for 1,000 km. The next-generation Qilin will give 500 km of range after 12 minutes of charge. 
• In what An described as a “very important” strategic partnership (our translation), Zeekr continues to source batteries from CATL. The long-range 007 sedan, offering a driving range of 870 km, will be powered by CATL’s nickel-manganese-cobalt (NMC) batteries.

Quzhou production base: The Quzhou factory, which also produces NMC batteries for other Geely-owned marques such as Smart and Galaxy, will have an annual capacity of 24 gigawatt-hours (GWh) next year. This will allow the automaker to achieve an annual production run rate of 840,000 EVs. 

• An mentioned the likelihood of supplying the battery type and module assembly to other Geely-affiliated brands, especially those that share the SEA vehicle platform Zeekr builds its cars on, as well as rivals’ models. 
• The facility started operations last month after being constructed in 15 months. The company is targeting a yield rate, which measures the number of satisfactory units coming out of all produced items, of 93% in Quzhou, Vice President Xie Shibin told reporters during an interview on Thursday. 
• Zeekr’s parent company Geely, which owns the facility, has deployed a set of solar arrays on the rooftop with a long-term goal of making it a zero-carbon plant, the executives added.

Context: Geely is the latest in a range of Chinese automakers from GAC to Changan that has turned to making its own electric vehicle batteries in order to lower production costs and gain control over its supply chain. An original equipment manufacturer (OEM) could recover its investment and make a profit if it produces more than 15 GWh worth of batteries, McKinsey & Company has estimated.

• The global EV battery market is currently led by CATL, with the Chinese giant accounting for more than a third of the market from January to October, according to figures compiled by industry tracker SNE Research.
• Among automakers, BYD made an early bet on in-house battery making, launching its blade-shaped LFP batteries in 2020 and recording shipment of 87.5 GWh during the first nine months of this year.
• Zeekr has been partnering with CATL, with the latter’s Qilin battery first equipped by the Zeekr 009 luxury van and the completion of a $750 million financing round partly backed by the battery giant early this year.
• The EV brand filed for an initial public offering in New York last December in the hope of raising more than $1 billion at a valuation of more than $10 billion. It has also made a foray into the European market, currently selling EVs in the Netherlands and Sweden.

Chinese tech giant Alibaba is doubling down on artificial intelligence to spur the growth of its e-commerce division, after founder Jack Ma wrote an internal memo saying the era of AI e-commerce “has just begun.” The company’s domestic and international retail businesses are testing multiple AI-driven tools and are on a hiring spree for AI-related roles, according to local outlet LatePost.

Why it matters: Alibaba hopes that by integrating generative AI into its core e-commerce business, it will further boost sales in the highly lucrative sector and create new forms of customer experience to up business retention rates.

Details: Taobao and Tmall Group have channeled their AI focus into four key areas:  marketing platform Alimama, customer apps, merchant apps, and industry-specific apps. Before the reorganization led by Alibaba’s chief technology officer Wu Zeming, there were around 20 teams within the group exploring AI-related businesses, the report said.

• This year’s Singles Day shopping festival, which started in late October, was a testing ground for Alibaba-created AI shopping assistants, including Taobao Wenwen, a chatbot designed for consumer-facing interaction that relies on its pre-trained generative ability to provide users with shopping recommendations. 
• The firm also introduced at least ten free tools for merchants to assist in their marketing and merchandising efforts during the month-long bonanza. While Alibaba kept silent on sales achieved during the festival this year, it announced that the Wenwen chatbot engaged with over five million users, and the merchant tools were used over 1.5 billion times.
• Enabling businesses to achieve lower operation costs through generative AI solutions is seen as a commonality among Alibaba’s AI products. Earlier last month, in a pilot launch event of Aidge, a tool facilitating features from translation and marketing to localized content and design, vice president of Alibaba International Zhang Kaifu said that it is dedicated to “simplifying global operations for small and medium-sized enterprises.” 
• Zhang also leads AI initiatives within Alibaba International Digital Commerce Group, overseeing a team of more than 100, according to LatePost, with one-third engaged in training large language models.

Context: AI appears to be a top priority in Alibaba’s strategy since new management took over in September. In his first letter to all staff, CEO Eddie Wu announced “user first, AI-driven” as his vision for the 24-year-old company, a business that has recently been overshadowed by rivals. “We will realign our operations and refocus our business around these two core strategies,” said Wu.

• An employee posted a critical note on an Alibaba internal forum after Temu parent PDD closed in on  the company’s market valuation late last month, a move that prompted Jack Ma’s rare appearance with him calling on staff to provide more constructive comments and suggestions, especially innovative ideas to the group.

Xiaomi on Tuesday released a statement refuting an apparent claim made by senior Huawei executive Yu Chengdong that Xiaomi’s dragon bone hinge technology for its foldable phones is a direct copy of Huawei’s dual rotating water drop hinge. Yu, the CEO of Huawei’s consumer department, made these comments during a company event last week; Xiaomi has said the accusation is “seriously inconsistent with the facts.”

Why it matters: One of the key elements of foldable phones lies in their unique hinge design, which directly influences the phone’s folding mechanism and screen creases. The controversy between Huawei and Xiaomi, two of China’s biggest phone brands, reflects intensifying competition in the foldable phone market.     

Details: In the statement, Xiaomi posted detailed comparisons, including the application dates, publication dates, and technical features of relevant patents. Both the design concept and mechanical structure of their dragon bone hinge are completely different from Huawei’s dual rotating water drop hinge, according to the statement, which was posted to the company’s account on the Twitter-like Weibo platform.

• “Some companies directly copy our technology and then claim it as their own invention. The concept of the dragon bone hinge is fundamentally non-existent, as they’ve transformed our double rotating water drop hinge into a dragon bone hinge,” said Yu during an annual Huawei event on Dec.10. “Once competitors make modifications, this technology becomes their own,” he added.
• While he didn’t explicitly name the rival phone brand, Yu’s remarks were widely interpreted as an attack on Xiaomi, which launched its new generation of foldable flagship, the Xiaomi MIX Fold 3, in August and is the only phone brand on the market to use what it terms a dragon bone hinge.
• According to Xiaomi’s statement, the dragon bone hinge was patented on September 18, 2020, and received patent authorization on January 5, 2021. Huawei’s dual-rotating water drop hinge was only publicly disclosed on June 18, 2021, though it was patented on December 13, 2019. 
• Xiaomi’s dragon bone hinge features a “three-level rod, five-component, seven-low-friction design,” the statement continued, while Huawei’s dual rotating water drop hinge is described as a “two-level rod, three-component, four-low-friction design.” 
• Furthermore, Huawei’s current three-level rod patent was applied for on October 29, 2021, and was publicly disclosed on May 5, 2023, but it has not yet entered mass production, according to Xiaomi.
• In the concluding part of the statement, Xiaomi emphasized that Yu Chengdong should adhere to “the basic principles of science” and refrain from misleading the public.

Context: Research firm TrendForce‘s report indicates that the anticipated shipment of foldable smartphones in 2023 is around 18.3 million units, with a year-on-year increase of 43%. Huawei’s estimated shipment of foldable smartphones this year is expected to reach 2.5 million units, according to the same report.

• The Xiaomi MIX Fold 3 set a new record for Xiaomi upon its release, with sales increasing 2.25 times compared to the previous generation, according to the company’s second quarter financial report.
• In the third quarter of 2023, sales of foldable smartphones in the Chinese market reached 1.98 million units, representing a year-on-year increase of 175%, according to CINNO Research. In terms of brand ranking, Huawei occupied the top spot with a market share of 28.6%, while Xiaomi was in sixth place with a market share of 8.7%.

Chinese tech giant Tencent is planning to expand its short video and livestreaming e-commerce team as sales surge, according to a Monday report by LatePost, which said WeChat’s in-app shopping feature has achieved a total of RMB 100 billion ($13.9 billion) gross merchandise volume this year via its TikTok-like short video service.

Why it matters: The figure shows Tencent has increasingly drawn in users to spend more time shopping on Video Accounts, a service that launched in beta mode in January 2020.

• According to the company’s president Martin Lau, Tencent could gain a competitive advantage by attracting “a pretty significant high-income and affluent customer base” on WeChat, who may not typically make purchases on other short video platforms.

Details: WeChat Video Accounts, Tencent’s short video feature also known as Channels, has been seen as the “hope” of the company since founder and CEO Pony Ma highlighted it in an end-of-year meeting in 2022.

• As a latecomer to livestreaming e-commerce, Tencent is set to further develop the basics of online shopping, including WeChat payments, LatePost reported. During the company’s latest earnings call, Lau said the livestreaming e-commerce playbook was “quite clear” despite involving many steps. Tencent wants, “to build it in a systematic way, step by step,” Lau added.
• While Tencent’s e-commerce sales have reached an impressive RMB 100 billion, it has a long way to go before catching up with rivals Kuaishou and Douyin, as the former boasted sales of nearly RMB 800 billion worth of goods in the first three quarters this year, while TikTok’s sibling app Douyin is expected to see more than RMB 2 trillion in goods sales this year.
• Video Accounts brought RMB 3 billion in advertising revenue in the second quarter, Tencent said, adding that the figure for the subsequent three months showed “strong growth” over the previous quarter, although exact figures were not disclosed. Kuaishou generated RMB14.35 billion in advertising revenue in the same period.
• Ad load, which sits at less than 3% for Channels compared to rival platforms that regularly exceed 10%, serves as a growth driver that translates into more revenue, according to Tencent’s Chief Strategy Officer James Mitchell.

Context: WeChat, which started as an instant messaging service, now offers users a rich ecosystem of services via its mini-programs (in-app mini-apps) and Video Accounts. Tencent’s hope is that it can continue to offer the company more routes to profitability.

• Lau highlighted that several hundred million users interact with over one million mini-programs on WeChat, which facilitated over RMB 1.5 trillion in gross merchandise volume (GMV) between July and September this year. 
• In an indication of the Tencent platform’s importance, iPhone maker Apple opened an official retail store within WeChat this July.

Volkswagen’s software unit Cariad and Chinese auto tech startup Horizon Robotics expect to recruit 300 employees by the end of this month for a newly established joint venture called Carizon, in an effort to meet growing local demand for advanced driving technology. 

Why it matters: The hiring spree marks the German auto major’s latest effort to develop its own in-vehicle software following an announcement last year of a $2.3 billion investment deal for a 60% stake in the JV in partnership with Horizon. 

Details: The two companies have not officially provided details of the recruitment plan, but Horizon’s co-founder and technology chief Huang Chang, leading a team of more than 100 engineers, has reportedly joined the JV. 

• Su Jing, a former head of Huawei’s autonomous driving team who has been on board at Horizon since earlier this year, will lead the development of advanced driving systems based on Horizon’s next-generation computing solution Journey 6. 
• Beijing-headquartered Carizon was officially set up on Nov. 20 with a registered capital of RMB 6.8 ($940 million), with VW and Horizon taking 60% and 40% stakes in the entity respectively, according to Chinese corporate data site Tianyancha.
• The JV will focus on rolling out automated driving technology powered by Horizon’s Journey series processors and integrated into VW’s upcoming battery EVs in China, according to an announcement dated Dec. 8. 
• VW and Horizon are on track to deliver their first collaborative development effort as early as 2025, Cariad China’s chief executive Chang Qing told Chinese reporters last month. This will allow VW vehicles to function independently on Chinese highways and certain urban streets, a feature popular with Chinese consumers.

Context: VW has made a series of moves to step up the pace of its software development for the Chinese market, including a $700 million deal for a 5% stake in Chinese EV maker Xpeng Motors unveiled in July.

• The German carmaker is also forming a JV with China’s ThunderSoft to improve its infotainment systems and car cockpits, Reuters reported in April, while partnering with smartphone maker Vivo on a similar effort.
• VW sold roughly 2.3 million cars in China for the first nine months of 2023, recording a year-on-year decline of 3%, of which roughly 117,100 units were EVs, up 3.9% from a year ago. It delivered 341,100 EVs in Europe over the same period, an increase of 60.9% from last year.
• Horizon said in April it has shipped more than 3 million computing solutions for over 120 car models from prominent Chinese automakers ranging from BYD to Geely. Self-driving startups such as Pony.ai and Qcraft are developing assisted driving technology based on its processors.
• US chip powerhouse Nvidia is also ramping up its self-driving car efforts in China with plans to expand its workforce locally after recently hiring Wu Xinzhou, a former vice president at Xpeng Motors, TechNode has reported.
• Speaking to Chinese media outlet LatePost in July, Wu said that foreign companies would need to establish research and development teams of “at least several hundred people” locally to be able to compete with Chinese carmakers and self-driving car companies (our translation).

A recent report by Taiwanese media outlet DigiTimes suggests that Chinese panel manufacturer BOE is facing challenges in expanding its OLED (organic light-emitting diodes) supply for Apple’s iPhone 15 models, primarily due to light leakage issues. 

Why it matters: If BOE fails to address the light leakage problem, there is a high possibility that they may lose potential orders for the iPhone 15 and iPhone 16 from Apple.

Details: The current yield rate of BOE’s OLED panels for the iPhone 15 has dropped to 30% on the back of the issue, causing a decrease in production output, according to the DigiTimes report. 

• BOE has been selected to supply OLED panels for the iPhone 15 and iPhone 15 Plus. However, the supplier encountered a problem with light leakage, specifically in the panels designed for the standard models. The issue revolves around the Dynamic Island on the OLED display, where the hole punch and the pill-shaped cutout housing the TrueDepth camera sensor and FaceID are located.
• Given the light leakage issue and potential impact on iPhone sales, BOE may face challenges in expanding orders from Apple, which in turn would impact its revenue. According to industry analysis, BOE was expected to supply 5 million to 15 million panels for the iPhone 15 this year. However, due to lower production yields, the actual supply may be limited to a range of 2 million to 3 million panels.
• As Apple shifts its focus to the next-generation iPhone 16 series, avoiding light leakage is becoming more challenging, especially with larger panels. The iPhone 16 and 16 Plus are expected to feature OLED panels similar to the iPhone 15 and 15 Plus, while the Pro series may sport larger sizes, according to US media outlet Wccftech. The iPhone 16 Pro is anticipated to come with a 6.3-inch display, larger than the 6.1-inch display on the iPhone 15 Pro.

Context: Samsung also manufactures OLED panels for the iPhone 15 lineup, holding a dominant 91% share of the supply from June to August this year, according to DigiTimes. If the issue of light leakage persists, Samsung’s greater efficiency would become a significant concern for BOE in the short term.

• In terms of the foldable panel market, Samsung is anticipated to uphold its leading position during the third and fourth quarters of this year, commanding a 74% market share, according to Korean media outlet Business Korea. While this represents an increase from the second quarter’s 63%, it marks a decline of 17% from the 91% share it held during the same period last year. 
• BOE, which previously held a 4% market share in the foldable panel market during the third and fourth quarters of 2022, is projected to surge to 18% in the same period this year. This growth can be attributed to its supply to Chinese foldable smartphone manufacturers such as Huawei, Honor, and Oppo.

Tesla is preparing for a major expansion of the Gigafactory Shanghai, its core electric vehicle production facility in China, in a move that looks set to enable the US automaker to bring out its long-rumored budget compact hatchback, local media has reported. 

The company is also said to be readying to supply Chinese clients with its large-scale utility batteries known as Megapacks from next year, having begun searching for a head of local sales. The availability of the Megapack in China will step up the pace of Tesla’s entry into the country’s energy storage market.

Why it matters: The news comes after Tesla CEO Elon Musk had dinner with Chinese president Xi Jinping, alongside other American company executives, on the sidelines of the Asia-Pacific Economic Cooperation Summit in San Francisco on Nov. 15. 

• In a statement published on the Chinese Twitter-like platform Weibo the next day, Tesla said it looked forward to joint developments with China in areas such as green energy vehicles, energy storage, and artificial intelligence, citing Xi’s support for Tesla’s operations in the country. 
• The moves are expected to help Tesla almost double its local production capacity and diversify its revenue sources at a time when the EV giant sees slowing sales due to growing competition from domestic players. 

Details: The so-called phase-three expansion could facilitate the production of Tesla’s upcoming car, dubbed the “Model 2” or “Model Q” with a price tag as low as RMB 150,000 ($21,800), people with knowledge of the matter told LatePost on Wednesday. 

• The expansion was put on ice early this year, according to a Jan. 12 report by Bloomberg, after apparent concerns from the Chinese government over data security issues related to Starlink, the satellite internet unit of SpaceX, Elon Musk’s rocket company. 
• Details of the plan remain unclear, but if it proceeds, Tesla is expected to be able to nearly double its manufacturing capacity in China to 2 million EVs a year. Analysts expect volume production of the lower-priced, next-gen Tesla vehicle no earlier than 2025.
• Meanwhile, Tesla in April announced plans to build a new facility in Shanghai – capable of making 10,000 large-scale, energy-storage battery systems, or 40 gigawatt-hours-worth (GWh) of the Megapack – scheduled to commence operations in the second quarter of 2024. 
• Sources told LatePost that the China-manufactured Megapack batteries will be delivered locally and overseas. 

Context: Tesla sold 771,171 China-made EVs in the first 10 months of the year, up 39% from a year ago, of which 308,816 were overseas exports, according to figures compiled by the China Passenger Car Association (CPCA). The annual growth rate saw a drop compared to 50.3% last year. 

• The US firm said in January that it deployed 6.5 GWh of energy storage in 2022, representing year-on-year growth of 64%. It estimated that the world requires a total capacity of 2,310 GWh per year of electric-chemical battery storage systems such as the Megapack in order to achieve a 100% global clean energy transition, according to estimates from the EV maker’s Master Plan 3.

On Tuesday, Oppo smartphone subsidiary OnePlus unveiled its flagship series OnePlus 12 just in time to celebrate the brand’s tenth anniversary on Dec. 16. To showcase the specifications of the new device, OnePlus China’s CEO Li Jie spent a full three hours describing it in detail at the launch event, making regular comparisons to Xiaomi’s 14 Pro throughout.

Why it matters: The launch of OnePlus’ new flagship is a direct challenge to Xiaomi and its subsidiary Redmi, as the Oppo sub-brand looks to focus on high-quality smartphones with cutting-edge features offered at competitive prices. 

Details: At the launch event, OnePlus repeatedly compared the OnePlus 12’s software and hardware capabilities with those of the Xiaomi 14 Pro, emphasizing its starting price of RMB 4,299 ($606), compared to the latter’s RMB 4,999 ($705).

• The OnePlus 12 features a 2K BOE screen with medical-grade eye protection, the Find imaging system created in collaboration with Hasselblad, and the latest Snapdragon 8 Gen 3 chipset.
• OnePlus claims to have worked with Chinese display panel maker BOE for the past two years to create the 2K BOE screen for the OnePlus 12. The screen boasts medical-grade eye protection and industry-leading peak brightness of 4,500 nits. 
• The OnePlus 12 offers a camera setup that includes a 50 MP Sony LYT-808 sensor, a 48 MP IMX481 ultra-wide-angle lens, and a 64 MP Omnivision OV64B periscope telephoto lens with 3x optical zoom. For selfies and video calls, it is equipped with a 32 MP Sony IMX615 sensor at the front. The Find camera system is enhanced with Hasselblad branding and tuning technology, ensuring a high-quality imaging experience, according to OnePlus.
• The new flagship comes with a Qualcomm Snapdragon 8 Gen 3 processor under its hood. Working in conjunction with the Adreno GPU, the smartphone aims to achieve an improved gaming performance, thanks to the PixelWorks X7 Visual processor, as claimed by the company.
• The phone has a 5,400 mAh dual-cell battery, marking the largest capacity ever applied in a OnePlus device. It can charge at up to 50W via the company’s self-developed AirVOOC technology, which is three times faster than the 15W rate of Apple’s MagSafe wireless chargers. 
• The entry level model with 12GB RAM + 256GB storage is priced at RMB 4,299 ($606), while the premium version of 24GB RAM + 1TB storage is available at RMB 5,799 ($818). The phone is available in black, green, and white.

Context: In June 2021, OnePlus announced it had merged teams with Oppo, its parent company, to streamline its operations. 

• According to market research platform Counterpoint, Oppo and Xiaomi accounted for 14% of each of global smartphone shipments in the third quarter of 2023, with both firms shipping around 41.5 million units. Oppo’s data includes figures for its OnePlus brand.
• The Xiaomi 14 and 14 Pro, the first phones to feature the Qualcomm Snapdragon 8 Gen 3 chipset, were launched on Oct. 26 in China. The two smartphones are currently only available in China but are expected to launch globally in early 2024.
• OnePlus founder and chief product officer Liu Zuohu stated at the anniversary event that OnePlus smartphones are available in 10,000 Oppo offline stores in China.

Food delivery giant Meituan has shown its ability to defend its moat advantage in local services amid a challenge from ByteDance-owned TikTok sibling Douyin, with the company achieving RMB 2 billion single-month livestreaming sales this October, up from the less than RMB 600 million recorded in July when it officially introduced its in-app livestream feature, local media outlet 36Kr cited multiple sources as saying in a Monday report.

Why it matters: Meituan, a newcomer to the livestreaming domain, is employing a high-subsidy strategy within livestream rooms to attract both customers and merchants. Despite the strong growth momentum indicated by sales figures, the company’s profit margin has seen a decline for two consecutive quarters.

Details: Livestreams conducted by Meituan itself are the main focus of the newly launched function, where hosts are sourced from external multi-channel network (MCN) companies and generate more than 70% of live gross merchandise volume (GMV), according to the 36Kr report. However, this balance is shifting as small- and medium-sized merchants flow in to sell vouchers via independent livestreams. 

• Around 30% to 40% of orders paid for on livestreams are ultimately verified at physical stores and converted into the shop’s sales, one source was cited as saying in the report. Another source, a Meituan service provider, claimed that the overall verification rate is about 60%, nearly double that of Douyin.
• Shen Quan Jie and Shen Qiang Shou are two major official livestream brands within Meituan’s food delivery segment, selling discounted takeout coupons, especially for well-known or chain restaurants. The former is a monthly promotional event occurring on the 18th of each month, while the latter livestreams for 12 hours every day, primarily targeting users in China’s first-tier cities.
• Meituan’s Hong Kong-traded shares have slumped over 50% this year, and the company’s stock experienced its largest single-day decline in over a year last Tuesday after executives warned of a slowdown in revenue growth for its core food delivery business in the fourth quarter.

Context: Meituan has increased its marketing expenses this year in an attempt to resist TikTok sister app Douyin’s push into the local life services sector, spending RMB 16.9 billion in the last quarter, a 62.5% increase from the first quarter. Meanwhile, the operating margin of its core local business has continued to decline over the last two quarters, dropping below 20% in the three months from July to September to 17.5%.

• Short video app Douyin first took a step into the local services space with food delivery trials two years ago. It has now expanded its reach to include everything from sightseeing tickets and leisure events to parent-child activities. Local media outlet LatePost previously reported that these services generated over RMB 100 billion in sales for Douyin in the first half of 2023.

Major Chinese electric vehicle makers from BYD to Xpeng Motors have collectively posted strong delivery figures in November as they attempt to hit their annual targets and as competition shows no signs of subsiding in the world’s biggest auto market. 

Why it matters: Jefferies analysts wrote in a Dec. 1 note that they estimated sales of China’s new energy vehicles (NEVs), mostly all-electrics and plug-in hybrids, to reach 1 million units in November with a solid month-on-month growth rate of 10% from a high base. 

• However, analysts warned of an intensified price war as 2023 comes to a close, as major EV brands including BYD and Li Auto have either cut prices or increased the royalties for customers since late November to boost year-end sales. 

Details: BYD on Dec. 1 revealed monthly sales figures of its premium Fangchengbao and Yangwang marques for the first time following their launches earlier this year, announcing it handed over 626 and 408 units to customers, respectively. Delivery of the RMB 1 million ($150,000) Yangwang U8 and the Bao 5, with a price range of RMB 289,800 to RMB 352,800, began in late September and November separately. Overall, the EV giant outsold its October figures by 70 units in November. 

• Geely’s NEV sales increased 4.7% month-on-month to 65,034 units last month thanks to a wide product portfolio under a multi-brand strategy. Volvo’s parent said it delivered 13,770 units under the Galaxy marque and 13,104 Zeekr-branded battery EVs, while sales of its Lynk & Co 08 extended-range hybrid EV surpassed the 10,000 mark over the month. The numbers of GAC’s Aion and Great Wall Motor rose 0.15% and 0.23% from a month previously, respectively. 
• Huawei-backed Aito posted its best-ever month by delivering 18,827 units, which is nearly 50% higher than its deliveries in October and surpassed the top end of the guidance provided by Huawei’s head of consumer business group a week ago. The number is expected to exceed 23,000 this month and to hit 30,000 in January, as the EV maker said it has secured more than 100,000 non-refundable orders for the revamped M7 crossover over the last two months or so.
• Growth momentum has been sustained for both Li Auto and Xpeng Motors which once again reported record-setting deliveries of 41,030 and 20,041 vehicles last month respectively. Li Auto’s founder Li Xiang said it is aiming for deliveries of 50,000 EVs this month, while Xpeng on Nov. 15 forecasted the fourth quarter delivery of up to 63,500 units. NIO‘s November delivery of 15,959 vehicles is basically flat from the previous month. 

Context: China’s NEV sales were partly boosted by the opening of the annual Auto Guangzhou show on Nov. 17 with dozens of debuts of all-new cars, as major players try to enhance their presence among a crowded field. 

• More than 5.9 million NEVs were sold during the first ten months of this year, representing a year-on-year growth of 34.2% and accounting for 34.1% of total car sales in China, according to figures from the China Passenger Car Association. 
• Miao Wei, former minister of Industry and Information Technology, expects the NEV penetration rate to exceed 50% of all new car sales as early as 2025. That would be 10 years ahead of Beijing’s schedule. Miao made the comment on Nov. 29 during this year’s China Automotive Industry Forum, reported media outlet The Paper.

A federal judge has blocked a law in the US state of Montana that sought to bar the use of TikTok, saying it “oversteps state power”, a month before the ban was due to take effect.

Why it matters: The move suggests efforts to prohibit use of the Chinese-owned video sharing app in the US will face significant legal challenges. Montana was the first state set to implement a blanket TikTok ban.

Details: In a statement, the US District Judge Donald Molloy said the ban targets “China’s ostensible role in TikTok” rather than protects Montana consumers.

• “We are pleased the judge rejected this unconstitutional law and hundreds of thousands of Montanans can continue to express themselves, earn a living, and find community on TikTok,” an account called TikTok Policy posted on social media platform X.
• However, the office of Montana’s attorney general signaled it was not giving up on a ban, saying “the analysis could change as the case proceeds,” and noting that it looked forward to “presenting the complete legal argument to defend the law.”
• The ByteDance-owned video platform filed a federal lawsuit against Montana in May, claiming the law “unlawfully abridges one of the core freedoms guaranteed by the First Amendment,” days after the state passed a law to ban the widely popular app across the state. Senate Bill 419, the initial ruling to ban TikTok in Montana from Jan. 1  2024, outlined a concern that the app accessed data against users’ will and shared it with the People’s Republic of China. An additional consideration for the ban was that it promoted dangerous social media challenges that threatened the health and safety of Montanans.
• TikTok’s Chinese links have been a focal point of running controversy in the US, where the app says it has 150 million users. Inadequate protection of minors’ data is another legal fight the platform has been dealing with.

Context: TikTok has continued to face criticism during its rise in the US, but its popularity and ad revenue point to a continued upward trend in use of the app nationwide. Its parent company ByteDance reportedly generated $54 billion globally in the first half of 2023, a figure close to Facebook owner Meta’s $60.6 billion. The video platform also officially launched an in-app e-commerce feature in September.

More Chinese automakers are planning to adopt NIO’s battery swap technology as two giants join the program – Changan and Geely. NIO on Wednesday said it will partner with Geely to develop a common standard for electric vehicle battery packs and create a sprawling network of swap stations for both consumer cars and commercial fleets, just a week after Changan said it had become NIO’s first ally in a similar effort. 

The move could give a further boost to NIO’s long-term plan to split its money-losing recharging infrastructure unit into a standalone business with financing from outside investors, two people with knowledge of the matter told TechNode on Wednesday. Meanwhile, Geely and NIO will explore the possibility of establishing a shared battery swap network in overseas markets, said one of the people, without elaborating further. 

NIO and Geely declined to comment when contacted by TechNode on Thursday, referring instead to the announcement published by the two companies.

Car industry experts foresee the acceleration of the Chinese EV industry’s migration to a more unified standard for battery specifications and swap techniques originated by NIO. Still, the EV maker and its bigger allies could face a bumpy road despite their eagerness for a unified swapping standard until a number of business and technical hurdles are cleared. 

A common standard? 

It is clear that Chinese authorities are behind the move given that Changan is state-owned and given Geely’s position as the poster child for the Chinese privately-owned car industry, said Lei Xing, former chief editor at China Auto Review. Xing expects no real progress to be made within the next 12-18 months given the challenges in achieving a clear consensus for designing new batteries compatible with their recharging networks. 

A market-wide standardization may also not happen without government intervention. It’s one thing to require a certain plug type, and quite another to force standardization of batteries and chassis configuration, said Daniel J. Kollar, head of automotive and supply chain at business development consultancy Intralink Group. 

“This could have major effects on several design aspects and possibly even lead to certain limits on innovation and supplier choice,” Kollar added.

NIO may also find the need for considerable back and forth with its partners in order to get its swap technology closer to becoming the industry standard. It’s going to be NIO dictating its intellectual property to swapping partners, but Geely and Changan may want to have a say as well, said Tu T. Le, founder of business intelligence firm Sino Auto Insights. 

“There’s a lot that needs to be settled still,” Le added, citing Geely running its own swapping system as one reason. Volvo’s parent began operating its first battery swap station for commercial fleets in the southwestern municipality of Chongqing in late 2020, with plans to run 300 more by the end of this year.

A big relief?

Although it is too early to predict where NIO’s power business may end up, it is possible that a new entity jointly invested in by NIO and multiple other carmakers could be in play – something akin to what Huawei recently announced for its vehicle business unit, according to Xing. “This would ease the financial pressure on NIO and make them de facto outside investors of the startup.” 

The partnership would probably shoulder some of the investment burden for NIO with cash injections, although it may not help them sell cars, Le said. The increase in adoption of swapping will likely result in short-term improvements to their bottom line, but the big question is if it will result in more vehicle sales. 

The Shanghai-headquartered EV maker has built up a nationwide network of more than 2,100 swap stations, each reportedly costing more than RMB 3 million ($420,000) on average. That number is expected to surpass 2,300 by year-end. It delivered 126,067 vehicles for the first ten months of this year, in line with the industry’s average growth rate but lagging behind rivals such as Li Auto. 

“It’s hard to see how this is going to change NIO’s fortunes in the long run to a significant degree without added help from their new partners – either via providing a boost to their marketing reach or supporting the development of mid-market solutions,” said Kollar.

Chinese-owned semiconductor company Nexperia announced on Monday that the Dutch government has approved its acquisition of Nowi, a Dutch semiconductor startup. Previously, the Dutch government had been investigating the transaction on the grounds of national security.

Why it matters: In June, the Dutch government introduced the Act on Security Screening of Investments, Mergers and Acquisitions (Vifo Act), which includes the scrutiny of sensitive technologies such as photonics, quantum technology, and semiconductors. However, despite the influence of export sanctions led by the US, the Dutch government’s approval of Nexperia’s acquisition indicates that the Netherlands may still be open to business with China.

Details: The Dutch Minister of Economic Affairs Micky Adriaansens stated in a letter to the Dutch parliament on Nov. 27 that there are no legal objections to the acquisition of Nowi by Nexperia, according to Bloomberg. 

• Established in 2016, Nowi, is a semiconductor startup based in Delft, in the western Netherlands. The company specializes in manufacturing power management chips capable of harnessing ambient energy sources such as light or vibrations, offering a promising solution to eliminate the reliance on batteries in basic electronic devices. In November 2022, the company announced that it would be acquired by Nexperia. 
• In June of this year, the Dutch government initiated an investigation into the Chinese firm’s takeover of Nowi, based on the Vifo Act that came into effect on June 1. The Dutch government stated at the time that it would order the cancellation of the transaction if the deal was found to affect national security.
• On Monday, Nexperia issued an announcement in response to the Dutch government’s final decision. The retrospective effect of the Vifo Act is applicable only to military or dual-use items, and it is evident from the government’s assessment that Nowi’s products do not fall within this category, the company said. After a “period of uncertainty,” Nexperia and Nowi are “able to further realize their ambitions in the Dutch chip ecosystem,” the announcement added.
• In the current climate, it is crucial to establish a well-defined policy that enhances the investment environment in the Netherlands, said Charles Smit, director of Nexperia Netherlands. A transparent and fact-based communication channel between the government and businesses is essential during these times, he asserted.
• Having access to the production, sales and marketing infrastructure of a leading chip manufacturer allows Nowi to bring products to market faster and therefore have a greater impact, according to Simon van der Jagt, co-founder and former CEO of Nowi.

Context: Based in the Netherlands, Nexperia is a subsidiary of the partially state-owned Chinese company Wingtech Technology. The semiconductor firm has a workforce of over 15,000 spread across Europe, Asia, and the US. Nexperia’s components are used in automotive, industrial, mobile, and consumer industries.

Fast fashion giant Shein has confidentially filed for an IPO in the US, Reuters reported on Monday, citing two sources. The move puts to an end long-running speculation around the China-founded company’s intentions to go public.

Why it matters: A successful listing for the fast-fashion giant would help Shein expand its global reach while diversifying its sources of funding.

Details: Shein has hired Goldman Sachs, JPMorgan Chase, and Morgan Stanley as lead underwriters for the share offering and expects to go public sometime in 2024, according to Reuters.

• The company’s current valuation is uncertain. In a $2 billion funding round in May, Shein was valued at $66 billion, a third less than its $100 billion valuation from a funding round a year earlier.
• Now headquartered in Singapore, the retailer sells everything from skirts to sweaters, typically for around $10 a piece, in more than 150 countries. Shein has actively sought to diversify its supply chain, moving away from reliance on China. The company began manufacturing in Turkey and Brazil this year and is in the process of planning for a factory and warehouse in Mexico.
• Under ongoing regulatory scrutiny in the US, its largest market, Shein faces allegations related to design infringement and the use of forced labor in its factories.
• Shein did not respond to TechNode’s request for comment.

Context: In 2022, eleven years after its founding, Shein recorded $23 billion in revenue and $800 million in net income, according to the Wall Street Journal. A company executive reportedly told investors in July that it had achieved record profitability in the first half of 2023 thanks in large part to strong sales in the US.

• In a bid to further expand its international presence, Shein acquired a one-third stake in Forever 21’s parent company in August, followed by the purchase of fast fashion brand Missguided and all of its intellectual property in October.

Huawei is spinning off its automotive business unit, enabling Changan Automobile and other manufacturing partners to invest, in a move aimed at turning the loss-making car division into a profitable operation amid fierce competition. 

Why it matters: The reorganization is a rare move for Huawei – a company under 100% ownership of founder Ren Zhengfei and its staff since 2003, according to its official website – as the Chinese telecommunication giant puts a date of 2025 on its target of profitability for its as-yet loss-making auto business. 

• Deemed by Citic Securities analysts as “a milestone” for the Chinese auto industry, the move is expected to help Huawei court new industry allies and gain investment to pursue intelligent vehicle technology. Established automakers such as SAIC have reportedly voiced concern about Huawei’s move into electric cars. 
• The equity structure of the new entity may be comparable to that of the United Automotive Electronic Systems, a joint venture formed by German auto supplier Bosch and several Chinese carmakers including SAIC, FAW, and Dongfeng in 1995. This would allow more automakers to benefit from collaboration, and not just Changan, analysts wrote in a Nov. 26 note. 

Details: The new joint venture will focus on areas already covered by Huawei’s Intelligent Automotive Solution (IAS) business unit, including the development of intelligent driving software, digital cockpit systems, and digital platforms, among others, according to a regulatory filing published by Shenzhen-listed Changan dated on Monday. 

• Huawei will take at least a 60% stake in the new entity but will no longer directly compete against the new company in principle. Changan and its relevant parties will acquire no more than a 40% stake in the JV. The two companies plan to discuss the details of the transaction and sign an agreement within six months, the filing said. 
• The establishment of the new entity will have no impact on the ongoing collaboration between Huawei and Chinese car manufacturer Seres, according to a Nov. 26 statement. Seres, which makes Aito-branded EVs for Huawei, added it has been asked to participate in the investment and is in discussions to jointly develop intelligent electric vehicle architecture.
• The entity will prioritize diversified ownership, said the filing. It is anticipated that various parties will engage deeply in the development of the open vehicle platform, said Richard Yu, CEO of Huawei’s consumer business group and chairman of the IAS BU, who compared the platform to “a train engine.” 

Context: Huawei, state-owned Changan and Chinese battery maker CATL announced a partnership to establish EV brand Avatr back in late 2020. The companies have sold roughly 20,000 units of the Avatr 11 battery electric crossover since delivery began last December, launching their second premium model with a starting price of RMB 300,800 ($41,240) earlier this month. 

• Huawei has also been selling EVs since mid-2021 with lesser-known Seres, formerly the Chongqing Sokon Industrial Group, followed by the launch of the first Aito-branded EV last September. Huawei said in early October that it had secured more than 50,000 non-refundable orders for the redesigned version of the M7, Aito’s second model, less than a month after its launch. That number was updated to more than 100,000 as of Monday.
• The Chinese tech giant is also partnering with domestic manufacturers Chery, BAIC, and JAC, showcasing the first model under the new Luxeed marque jointly set up with Jaguar Land Rover’s manufacturing partner Chery on Nov. 9. The Luxeed S7 sedan will be officially launched on Tuesday and the respective new models co-built with BAIC and JAC are set to hit the market in 2024. 
• Huawei reportedly invested $1 billion in its automotive business in 2021 and has since maintained its push into the Chinese intelligent EV market in an effort to diversify its revenue sources and offset the impact on its core businesses from US trade restrictions. The IAS BU recorded revenue of RMB 1 billion during the first half of this year, accounting for around 0.3% of its total revenue. 

READ MORE: Xpeng and Huawei-backed EV maker set new delivery records as demand grows for self-driving tech

Chinese mobile phone company Honor issued an internal announcement on Wednesday stating that the former Huawei sub-brand plans to optimize its equity structure and attract diversified capital through an initial public offering (IPO), as reported by local media outlet Icsmart. Honor has not announced a timeframe or a location for the upcoming listing.

Why it matters: The announcement comes three years after Huawei was effectively forced to sell Honor in November 2020 to help the sub-brand bypass the restrictions imposed upon Huawei by US sanctions. Bought by a state-owned enterprise in Shenzhen, Honor has since emerged as a leading phone brand in the Chinese market.

Details: As part of its preparations for the IPO, Honor has made adjustments to its board of directors: Wu Hui will serve as the new chairperson, while the former chair Wan Biao becomes vice chairperson.

• Following Xiaomi and Transsion, Honor may become the third domestic phone company to go public, according to Jiemian. Xiaomi is listed on the Hong Kong stock exchange and currently holds a market capitalization of HKD 377.8 billion ($48.87 billion), while Transsion’s market capitalization is valued at RMB 95.6 billion ($13.36 billion). 
• Ever since Honor’s spin off from Huawei, there has been speculation in the industry about a possible listing for the handset maker, including the possibility of a backdoor listing through Transsion.
• Honor resumed allocation of shares around June of this year, primarily targeting distribution partners at the municipal level in each province, according to the aforementioned report from Jiemian. Additionally, Honor has initiated an employee stock allocation program, with high expectations for the company’s listing among its staff.
• At the end of 2022, Honor completed another round of strategic financing, adding six new shareholders, with leading display-panel industry player BOE among them.
• The newly appointed chair, Wu Hui, previously served in the Shenzhen municipal committee office, before later being transferred to work in the Hubei provincial government and the municipal government in Xianning, a city in Hubei. In April 2021, Wu Hui returned to Shenzhen and took on the role of chairman of Shenzhen Environmental Water Group.
• Vice chair Wan Biao was once a key figure in Huawei’s consumer business department. He joined Huawei in 1996 and held various positions such as president of Huawei’s wireless product line, president of its terminal company, and COO of its consumer business department. In November 2020, Wan Biao joined Honor and became its chairperson.

Context: In the third quarter of 2023, Honor secured the top spot in the domestic smartphone market with a shipment share of 19.3%, according to research firm IDC. 

• During July to September of this year, Honor released three foldable devices, namely the Magic V2, V Purse, and Magic Vs2, aiming to establish a strong presence in the high-end phone segment. 
• In the third quarter of 2023, the Chinese foldable smartphone market continued its rapid growth trend, reaching a shipment volume of 1.96 million units, an increase of 90.4% year-on-year, according to the same report from IDC. Honor captured a market share of 15.1%, ranking fourth in this segment.

A Tesla car owner who protested against the company during the Auto Shanghai show in early 2021 has been forced to apologize for damaging the US car company’s reputation by alleging that Tesla sold defective cars, Chinese media outlets reported on Wednesday. 

Why it matters: The verdict marks the latest victory for Tesla in China after it faced mounting numbers of car owner complaints over various quality issues including unintended acceleration and brake failure in the past two years. 

• Among infamous cases are the woman who climbed onto the top of one of Tesla’s electric vehicles at the Auto Shanghai show in April 2021, and an accident resulting in two deaths and three injuries in southern China last November.

Details: A local court on Nov. 9 ordered a woman surnamed Li from the northwestern city of Xi’an to apologize to Tesla and pay the company RMB 2,000 in damages in addition to bearing the cost of vehicle appraisal totaling RMB 20,000 ($2,800). The public apology should remain on social media platform Weibo for at least 15 days, the court ruled.

• The female owner alleged faulty brakes caused an incident in March 2021 when her China-made Model 3 crashed into a car coming the other way in the capital of Shaanxi province. Tesla has denied the claim. 
• Li took part in a protest at the Tesla booth during that year’s Auto Shanghai show when she wore a white T-shirt with the words “brake failure” above a Tesla logo. Another female car owner surnamed Zhang then clambered atop a Tesla to express her anger. 
• The Chinese court required a third-party appraiser to conduct systematic inspections of the vehicle after Tesla filed a lawsuit against Li for defamation. The result showed no proof that any mechanical failure had contributed to the accident. 
• A company representative confirmed the news to Caixin on Wednesday, saying the automaker was attempting to appeal for higher compensation. It is also suing Zhang for damaging its reputation without taking further steps, as she rejected a third-party investigation of her car. 

Context: Tesla in May launched a recall involving over 1.1 million EVs in China following an investigation by Chinese regulators that showed Tesla owners could hit the accelerator pedal rather than the brake by mistake when its regenerative braking system was switched on by default. Beijing said the recall was intended to reduce the chance of accidents. 

• The US carmaker shipped 771,171 vehicles from its Shanghai gigafactory during the first ten months of this year, of which 462,355 were for domestic sales, a growth of 37.9% from a year earlier, according to figures from the China Passenger Car Association. Retail sales of new energy vehicles in China, mostly battery EVs and plug-in hybrids, increased 34.2% year-on-year to more than 5.9 million units over the same period, the CPCA figures showed. 

Baidu said on Tuesday it has “comprehensively reshaped” its product portfolios thanks to its AI foundation model ERNIE, resulting in increased operational efficiency, after the Chinese search giant company reported 6% year-on-year revenue growth to RMB 34.4 billion in the third quarter. However, the company’s cloud unit reported its first decline in revenue in almost three years.

Why it matters: Baidu pointed to artificial intelligence bringing about positive changes in key performance indicators across all of its businesses in its latest earnings report. The firm also highlighted that its ChatGPT-like service ERNIE Bot has already amassed 70 million users.

Details: Although the company’s overall growth was up, Baidu’s AI cloud revenue decreased by 2% in the three months to September. Robin Li, CEO of the firm, said this was due to weak demand in smart transportation projects, despite strong demand for generative AI. The figures marked the first decline in Baidu’s cloud business since it started announcing its earnings separately in the last quarter of 2020.

• Online advertising business, which accounts for over half of Baidu’s total earnings, experienced 5% year-on-year revenue growth during the period. This growth rate was slower than the preceding two quarters and lags behind some of its internet-focused peers.
• During the related earnings call, Li expressed confidence that Baidu’s current chip reserves could “keep improving ERNIE Bot for up to two years” amid the US’s tightening of curbs on advanced chip exports to China. He did, however, add that Baidu will still seek alternatives due to the pace of AI development in China being “inevitably” impacted by difficulties in acquiring the most advanced chips.
• The chief executive of Baidu warned a week ago that China’s rush to develop multiple large language models had led to a “wasting of resources,” and he again told investors on the call that “the best option on the market” is companies developing AI-native apps based on Baidu’s foundation model rather than training models themselves.
• Baidu also named JD CEO Sandy Xu as an independent director of its board effective from the beginning of 2024.

Context: Baidu’s large language model, ERNIE, was made available to the public at the end of August after receiving government approval. Last month, Baidu launched the latest version of its AI model, ERNIE 4.0, seven months after the release of its first version.

GAC Group and Changan Automobile, two of China’s biggest automakers by sales volume, detailed their respective timelines to manufacture solid-state batteries on Nov. 17, entering a global competition to bring the potentially transformative technology to play in electric vehicles (EVs). 

The moves resonate in an industry that has long attempted to commercialize the technology, widely seen as a next-generation energy storage device because of its superior performance and safety compared with the current batch of liquid-state electrolyte lithium-ion batteries. Several international carmakers have bet on solid-state batteries, with leading promoter Toyota reportedly projecting adoption by 2027. 

The news also indicates a growing trend among automakers of developing their own batteries, parts that comprise at least 40% of overall vehicle costs, to establish a self-sufficient supply chain. “Few companies have so far profited from making new energy vehicles [mostly battery EVs and plug-in hybrid EVs in China],” said Changan president Wang Jun during a press conference, citing a goal of achieving “sustainable, high-quality development” (our translation). 

Here’s what the two automakers said on Nov. 17 during the ongoing Auto Guangzhou show in southern China’s Guangdong province.

GAC: The Guangzhou-headquartered automaker is hoping to see an EV in production with its own in-house developed solid-state batteries as early as 2026. For now, the batteries have achieved a cell-level energy density of 400 watt-hours per kilogram (Wh/kg) and have proven effective under extreme conditions, according to an announcement. By comparison, the maximum energy density of CATL’s latest Qilin battery is 255 Wh/kg (per pack level).

• The state-owned manufacturer added that it is working on several other new battery types including cobalt-free and sodium-ion packs, without revealing further details.
• Meanwhile, the Chinese partner of Toyota and Honda expects its first wholly-owned battery plant to start rolling out conventional lithium-ion batteries later this month. The RMB 10.9 billion ($1.5 billion) plant, Guangzhou’s biggest ever, will produce an annual capacity of 36 gigawatt hours (GWh) by 2025, enough for 600,000 EVs. 

Changan: China’s fifth largest automaker’s plans include commercializing its first solid-state batteries by 2027 at a cell-level energy density of up to 500 Wh/kg, while large-scale vehicle application is scheduled for 2030 with the launch of several new battery products, said president Wang.

• As part of an RMB 10 billion investment plan, the Chongqing-based manufacturer will more than double its number of research and development employees from 1,200 to 3,000 by next year. It has also set its sights on making lithium-sulfur and other new battery types next decade.
• Ford’s manufacturing partner also projected its timeline for mass-producing lithium-ion batteries, starting as soon as next year. The product features a design in which battery cells are integrated directly with the vehicle body rather than segmented into several modules. This technology has enabled CATL’s Qilin batteries to promise a driving range of over 1,000 kilometers (621 miles) on a single charge. 

Context: Established automakers worldwide have been rushing to get solid-state batteries commercially ready for their green energy cars, which is intended to give them an upper hand as they navigate increasing competition in the global EV market. 

• In addition to Toyota, Nissan plans to launch a production EV with a solid-state battery pack by 2028 and BMW by 2030. China’s SAIC said in May that it has increased its investment in local battery startup Qingtao as part of its ambitious goal to sell 100,000 EVs with solid-state batteries in 2025.
• CATL in April unveiled a so-called condensed matter battery, a semi-solid state product using a condensed electrolyte, with plans to start mass production for aviation by year-end, Reuters has reported. The battery giant controls more than a third of the global market, according to figures compiled by South Korea’s SNE Research on Nov. 7. 
• The world’s second-biggest battery maker by shipment, BYD initiated its battery efforts two decades ago and accounted for 15.8% of global EV battery sales in the first nine months of 2023. Having benefited from its vertically integrated supply chain, the EV giant recorded a net income of RMB 10.4 billion in the past quarter.
• ​​A solid-state battery uses a solid electrolyte instead of liquid electrolytes, boasting a theoretically higher thermal stability and energy density than existing offerings. However, the batteries still suffer interface instability between electrodes and solid-state electrolytes, among other design issues.

Oppo launched its latest high-end foldable phone, the Find N3, on Oct. 19, highlighting advances in screen, imaging, security, and system interaction. The 12GB+512GB variant is priced at RMB 9,999 ($1,392), while the collection edition with 16GB+1TB storage costs RMB 12,999 ($1,810). The new device comes in three colors: green, gold, and black. Our team was given a fortnight to review a black 12GB+512GB model.

The Find N3 is a stylish device, albeit slightly weighty in the hand, with a dual high-resolution display, and a processor that plays to its visual prowess. The Snapdragon 8 Gen 2 processor ensures a steady performance, placing it among the top foldable smartphones currently available. 

Mature leathery design

The leather case with a discernible grain offers users a comfortable grip and a pleasant feel. In terms of dimensions, when folded, the device feels hefty both in the hand and pocket compared with other non-foldable devices’ lightweight profiles. However, for a foldable device, the Find N3 surprises with its relatively lightweight, coming in at approximately 239 grams. The device boasts a thin profile, measuring a mere 5.8mm when unfolded and 11.7mm when closed.

In terms of overall appearance, the Find N3 leans towards the classic, giving it a business look. This is an aesthetic geared somewhat towards older generations.

LTPO technology and durable hinges

The Find N3 unfolds to a 7.82-inch screen with a resolution of 2,440 x 2,268 pixels, and the outer cover screen measures 6.31 inches with a resolution of 2,484 x 1,116 pixels. LTPO (low-temperature polycrystalline oxide) technology makes a smooth 1-120Hz dynamic refresh rate possible for fluid scrolling and gameplay, with up to 2,800 nits peak brightness.

Both screens are covered in toughened glass, improving drop resistance and strength. In addition to IPX4 splash resistance, the Find N3 is the first phone to be independently tested to withstand one million folds by TÜV Rheinland, according to Oppo. The phone’s crease is not visible unless you look at it from a certain angle.

Enhanced imaging performance

The Find N3’s camera system is branded by Hasselblad and sets new benchmarks in its category. It features two selfie cameras, with a 20MP camera inside and a 32MP camera on the cover screen. On the back, there is a 48MP LYTIA-T808 sensor from Sony, which is a 1/1.43″ sensor equipped with dual-layer transistor technology. This technology ensures great light sensitivity and ultimately leads to improved image quality.

The device’s day and night time photography capabilities stand out within the foldable phone category, as evidenced by the following images. In portrait mode, photos have a great sense of contrast, even in low light.

Snapdragon 8 Gen 2 powers high-performance gaming

The Find N3 features the Snapdragon 8 Gen 2 with 16GB of LPDDR5X RAM and 512GB. Qualcomm unveiled the Snapdragon 8 Gen 3 at its Snapdragon Summit on Oct. 24 but as no foldable phone currently on the market features the new processor yet, the N3 is the most powerful in its category. Our two-hour test of the mobile game Honor of Kings revealed stable performance without any overheating. Stereo speakers also enhance gameplay.

Users can play the same game on two different screen sizes: unfolded and folded. Although the display size and games have been adjusted to some extent, the gaming experience may feel quite different to what users are used to when the phone is unfolded. Gaming enthusiasts be warned that, folded, it also takes some time to get used to the phone’s thickness.

High-capacity battery 

The Find N3 is equipped with a high-capacity 4,850mAh battery. For reference, the iPhone 15 Pro features a battery rated at 3,274mAh. Our practical tests have shown that the new Oppo phone’s battery life can support a full day’s use even under moderate or high-intensity usage. The phone also supports 67W fast charging technology and can be fully charged in around an hour.

Privacy protection and office functions

The Find N3 offers multiple privacy protection functions, including a security chip with national encryption certification, file encryption technology, and end-to-end cloud transmission encryption. The device is equipped with a button on the side, allowing users to easily switch to “VIP” mode, which disables the camera, microphone, and location permissions in one go. 

On the software interaction front, the Find N3 improves office efficiency by enabling users to directly access files made in Apple’s office trio Keynote, Pages, and Numbers, as well as CAD engineering drawings. This breaks down a barrier between Android and Apple, enabling seamless file sharing.

Conclusion

The Oppo Find N3 performs well in terms of chipset performance, screen quality, camera capabilities, and battery life, setting a new benchmark in the foldable smartphone category. It is just as well that the Find N3 is suitable for business professionals, as its relatively high price excludes many other consumer groups.

Pros

• Thin and lightweight entrant in the foldable category
• Leathery design for a firm grip
• LPTO screen with 120Hz adaptive refresh rate
• Great camera performance for a foldable phone
• Large battery and 67W fast charging technology
• Self-developed security chip

Cons

• Slightly heavy for long-time use and carrying in the pocket 
• Gaming on the device takes some getting used to
• No wireless charging support
• Expensive

As automakers continue their struggle amid an unrelenting price war in China, both established brands and startups are showcasing their latest products at the Auto Guangzhou 2023 show in a bid to take pole position ahead of what promises to be another year of tight competition. 

Traditionally one of the country’s largest car shows, this year’s Auto Guangzhou offers a glimpse of how intense competition in China has been, and how successful it has been at flushing out weaker foreign marques as domestic rivals fall over one another in a mad rush to crack the market. 

“Joint car manufacturers are faced with unprecedented challenges against the backdrop of the current situation,” said Wen Dali, a deputy general manager of GAC-Toyota, a joint venture between the Japanese automaker and its Chinese partner (our translation). More than 20% of the JV’s new car sales over the next three years in China are set to be new energy vehicles, mostly battery-run electric vehicles (BEVs) and plug-in hybrid EVs (PHEVs), Wen added at a press event on Friday. 

Here’s a quick roundup of some of the highlights from the Guangzhou International Automobile Exhibition, which kicked off on Friday in the capital of China’s Guangdong province. 

BYD – Sea Lion 07

The BYD Ocean family of electric cars on Friday welcomed a new sibling and its latest answer to the Tesla Model Y, the Sea Lion 07, crafted by Wolfgang Josef Egger, BYD’s design chief and a former head designer at Audi Group. 

The mid-size crossover boasts distinctive design elements with its muscular fenders, bold air inlets, and clean character lines on all four corners, while the high shoulder lines and the dual, through-type waistlines give the vehicle a sporty vibe. The features are intended to make the car look unique from miles away, Fan Jihan, a deputy director of BYD said on Friday during the show.

Slightly larger than Tesla’s Model Y at 4.8 meters in length and with a 2,900-millimeter-long wheelbase, the top-end all-electric car is expected to have a driving range of more than 700 kilometers (435 miles), compared with the 688 km claimed by the long-range version of its US rival. Scheduled for official launch later this year, it will be equipped with BYD’s latest advanced driver assistance system (ADAS), according to the company.

Geely – Zeekr 007 

This year’s Auto Guangzhou saw the debut of the long-awaited Zeekr 007, the first electric sedan under the premium marque of auto major Geely. 

The latest model from Stefan Sielaff, formerly a head of design at Bentley, the 4.9-meter-long all-electric vehicle comes with 1,711 high-intensity lamp beads powered by 75 automotive chips. This enables the car’s LED headlights to display a dazzling, customized lighting sequence with animation about 90 inches wide, showcasing some of the most advanced lighting technology by a Chinese carmaker. 

Meanwhile, the Zeekr 007 features an 800-volt battery system, which offers a driving range of up to 870 km on a full charge and can travel another 610 km on 15 minutes’ extra charge. Zeeker claims it to be the quickest accelerating road car of the same class ever made, going from 0 to 100 km/h (62 mph) in 2.84 seconds, while also being one of the earliest models to use Qualcomm’s latest 5-nanometer cockpit chip 8295. 

The company aims to begin delivering the car in January at a lower-than-expected pre-sale starting price of RMB 224,900 ($31,059). 

Xpeng Motors – X9

Xpeng on Friday was on its home court when it unveiled details of its first flagship multi-purpose vehicle (MPV) the X9, which the Guangzhou-headquartered electric vehicle maker expects will stand out from existing offerings with superior comfort and top-notch performance. 

With a competitive pre-sale starting price of RMB 388,000 ($53,544), the seven-seater has a claimed interior space of 7.7 square meters, which makes it 12% bigger than the Toyota Alphard, a worldwide top-seller in the chauffeur-driven luxury people mover category, according to chief executive He Xiaopeng. 

The family van is also said to have the best third-row seats on the market that can be adjusted for recline to a desired angle of nearly 180 degrees and folded down flat to increase cargo capacity. Meanwhile, the luggage compartment offers space for seven suitcases. 

The Xpeng X9 is claimed to be the world’s first MPV equipped with rear-wheel steering as a standard configuration, which reduces the car’s turning diameter to an industry record of 10.8 meters (35.4 feet), making it easy to maneuver. 

Li Auto – Mega

Li Auto has finally made available the details of its long-anticipated MPV, the Mega, with an exterior echoing the bullet-style look of China’s high-speed trains. The seven-seater van boasts the world’s fastest charging speed among electric vehicles of all kinds, capable of traveling up to 500 km on 12 minutes of charge powered by CATL’s next-iteration Qilin batteries. 

It has a drag coefficient (Cd) of 0.215, which the company claimed is the lowest Cd rating for an MPV, while it will consume 15.9 kilowatts (kWh) of electricity for every 100 km of travel, also among the lowest in the industry. 

The company, which has delivered more than 500,000 plug-in hybrid SUVs as of September, confirmed plans to build 300 supercharging stations in China by year-end. Pre-sales of the Mega started on Friday with a price tag of around RMB 600,000 ($82,800) and delivery scheduled for February 2024.

READ MORE: Chinese carmakers showed up big time at Auto Shanghai 2023

Images of what could be Xiaomi’s first electric vehicle model have leaked online ahead of the car’s expected launch next year. The photos from the Chinese Ministry of Industry and Information Technology show a large sedan with styling similar to the Porsche Taycan, adorned with a Xiaomi logo. 

Why it matters: Automakers are required by Chinese regulators to apply for registration before officially selling vehicles in the country, and the government ministry’s post indicates that the debut of the first Xiaomi car is approaching. 

• Xiaomi has begun trial production of its first EV at its facility on the outskirts of Beijing, with the vehicle expected to hit the market as early as February, a person with knowledge of the matter told Chinese media outlet National Business Daily on Wednesday. 
• A Xiaomi representative declined to comment when contacted by TechNode on Thursday, but in late October, chief executive Lei Jun reaffirmed the company’s plan for the car to go on sale in the first half of 2024, according to an Oct. 25 post published on the Twitter-like platform Weibo. 

Details: The Xiaomi SU7 is around five meters long and spans a 3,000-millimeter-long wheelbase, making it bigger than many mid-size sedans such as Tesla’s Model 3. It has a total mass of 2,430 kg and a curb weight of 1,980 kg, based on the registration details revealed by the MIIT on Wednesday. 

• The car features a sleek, athletic low profile with Xiaomi’s logo on the front and its name on the rear hatch, similar to the Porsche Taycan, a likeness brought to light by a Chinese auto influencer. The images also show a couple of wheel options and a choice of yellow brake calipers.
• The SU7 will be able to reach a top speed of 210 kilometers per hour on a relatively affordable, iron-based lithium-ion battery from BYD. The top speed of the premium SU7 Max will be 265 km/h, with the higher-end model equipped with a more expensive, nickel and cobalt-based battery pack from CATL. 
• An electric motor will provide a power output of 275 kW and 220 kW respectively, while the top-end version will integrate laser sensor units on the roof to enable partially autonomous driving capabilities, according to images released by MIIT.
• The five-seater sedan will be manufactured at Xiaomi’s factory in the Beijing Economic and Technological Development Zone, which has an initial annual capacity of 150,000 units, although its production application was filed in the name of a subsidiary of state-owned automaker BAIC.
• This appears to confirm speculation that BAIC, a manufacturing partner of Mercedes-Benz in China, has joined hands with Xiaomi, meaning the smartphone maker is still waiting for final approval to begin manufacture from the Chinese authorities. 

Context: Xiaomi and Huawei are among the Chinese technology giants with the potential to become major players in the EV space with advanced intelligent capabilities and a broad sales network, which remain difficult for many carmakers to replicate, Morgan Stanley analyst Tim Hsiao commented on an earnings call held by Xpeng Motors on Wednesday. 

• Huawei said on Oct. 6 that it had secured over 50,000 non-refundable orders for the revamped M7 sports utility vehicle less than a month after its launch. The number was updated to more than 90,000 as of Wednesday, local media outlet IT Home reported. 
• The telecoms giant started pre-sales of the first electric sedan under the new Luxeed brand with automaker Chery on Nov. 9, followed the next day by the launch of the Avatr 12, a premium crossover co-developed with partners Changan Automobile and CATL. 

READ MORE: Five things to know about Xiaomi’s new electric car company

In the third quarter of 2023, the import of chip-making equipment by China surged by 93% compared to the same period last year, reaching a total value of RMB 63.4 billion ($8.75 billion), according to data from China’s customs authorities, as reported by Japanese media outlet Nikkei. In terms of product categories, the import of lithography equipment, a key part of the chip-making process, skyrocketed nearly fourfold.

Why it matters: The US began attempts to control the export of advanced chip-making equipment to China last October, with Japan and the Netherlands following suit this year, but these new figures show the issues with enforcing such controls rapidly. As the lead time for chip-making equipment from order placement to delivery is between six months to one year, many Chinese manufacturers had already placed a large number of orders for chip-making equipment from the latter two countries last year, likely in anticipation of a ban.

Details: Although the Netherlands has implemented policies restricting the export of advanced semiconductor equipment to China, imports of semiconductor equipment by China from the country in the third quarter nevertheless increased rapidly. 

• According to data presented by Nikkei, the US accounted for only 9% of semiconductor equipment imported into China in the third quarter, significantly lower than its 17% share during the same period in 2021. Japan’s share also decreased from 32% to 25%, while the Netherlands saw an increase from around 15% to 30%.
• The data from China’s customs authorities reveals that the import value from the Netherlands skyrocketed by over six times in the third quarter compared to the same period last year, rising to 2.44 billion euros. A significant portion of this increase is attributed to lithography machines produced by Dutch market leader ASML. Imports of these machines from Japan grew by approximately 40%, while lithography equipment imports from the US increased by 20%.
• Compared with the second quarter of 2023, ASML’s sales revenue from China doubled from 24% to 46% of the firm’s total in the third quarter, amounting to 2.44 billion euros, according to the company’s financial report. In the first quarter of this year, ASML’s proportion of sales revenue generated by China was only 8%.

Context: According to the Netherlands’ new regulations on semiconductor exports, ASML’s lithography systems require an export license from the Dutch government for shipment. However, a statement from ASML indicated that the company believes its existing licenses still allow it to continue delivering lithography machines to China until the end of 2023, despite the export restrictions taking effect in September.

• ASML dominates the lithography market with an 82.9% market share followed by Canon and Nikon. It holds a market share that is over eight times greater than second-place Canon.

iPhone maker Apple has reportedly asked China’s major app developers to refrain from using gyroscopic motion, a feature that tracks the motion of a user’s phone, for advertising, as it all too readily redirects users to third-party apps on detecting even the slightest shake of a device. 

Why it matters: Open-screen advertising serves as a monetization method for many apps, while gyroscopic ads can boost the click-through rate of the target app. Those employing the feature have found that both parties can gain commercially, despite it taking control away from the user and thus impacting the user experience.

Details: Deployment of the function, criticized by numerous users, escalated during November’s three-week-long Singles Day shopping festival that has just ended. E-commerce platforms extensively used redirect ads across various apps, including the most widely used video and music streaming platforms, as well as social media apps. These ads can be triggered by clicking on an ad page or moving the phone, redirecting the user’s attention to another app.

• A netizen on Weibo, a Twitter-like platform, jokingly wrote that the redirection speed was faster than if they had directly opened the app.
• On-device gyroscopes help to achieve the ad redirect feature, though gyroscopes were originally designed to provide “experiences based on real-time, motion-based information in apps and games,” according to Apple.
• Another form of advertising similarly concealed within social media during China’s largest online shopping event was activated by Weibo blog comments – – individuals would write related comments and attach seemingly relevant webpage links. Once users clicked, they would find their phones had already opened advertised shopping websites. It remains uncertain whether this type of promotional tactic is directly linked to e-commerce sites.
• According to local media outlet Yicai, Taobao, JD, Pinduoduo, and Douyin have not explicitly said they received a notification from Apple, and Apple has not responded to the rumors.

Context: In February, China’s State Administration for Market Regulation made it clear in a guideline that advertisements should be clearly labeled using a closing icon, and should not deceptively induce users to click on or browse any advertisement. The new measures were supposed to further refine the norms of online advertising in China.

Following a year of negotiations, Tencent and Meta have made a deal for Tencent to  exclusively sell Meta’s VR (virtual reality) glasses in China from late 2024, The Wall Street Journal has reported.

Why it matters: As social media platforms Facebook and Instagram are banned in China, the return of Meta to the Chinese market is unexpected. It remains unclear if Tencent requires government approval to sell Meta’s devices due to the absence of VR-related government regulations in China.

Details: The agreement provides Meta with a fresh opportunity to tap into China’s expansive consumer market, a door that closed when access to Facebook was restricted in China in 2009.

• The VR glasses will offer consumers more affordable lenses compared to Meta’s existing Quest 3 headset, which is currently priced at around $500 in the US, according to The Wall Street Journal. The less expensive device is scheduled for sale in various international markets in addition to China in 2024. 
• Insiders told the WSJ that Meta will receive a larger share of hardware revenue, while Tencent will obtain a higher proportion of revenue from content and services. The Chinese version of the VR headset will offer games and apps distributed by Tencent.
• Meta’s current lineup of VR headsets includes the 2023-released Quest 3, the 2022-unveiled Quest Pro, and the Quest 2, which went on sale in 2020. The upcoming VR device from Meta may be named Meta Quest 3 Lite, with an estimated price of $199 for the basic model, according to Chinese media outlet Cailian Press. This new product may feature a modified chip that will impact upon its performance due to its low cost.
• In its third-quarter financial report on Oct. 25, Meta disclosed that its Reality Labs unit, which develops metaverse-related technologies, experienced an operating loss of $3.74 billion. Revenue in the virtual reality and augmented reality division dropped 26% during the reporting period, falling to $210 million from $285 million a year earlier.

Context: Global shipments of augmented reality and virtual reality headsets went through a decline for the fourth consecutive quarter in the second quarter of 2023, dropping by 44.6% year-on-year, according to data from market research firm IDC.

• Meta emerged as the dominant player in the headset market during this period, occupying an approximately 50% market share, according to the same report from IDC. Sony and Pico (the headset division of TikTok parent ByteDance) secured second and third places, respectively.
• On Nov. 7, in response to a decline in global demand for VR headsets, Pico reportedly initiated a significant round of job cuts, marking its most substantial overhaul since being acquired by TikTok’s owner two years ago.

Huawei on Thursday revealed its first electric sedan under the new Luxeed marque in collaboration with automaker Chery, saying it will compete with Tesla and Mercedes Benz’s premium offerings at a price comparable to the cheapest models of its international rivals.

“After some deliberation, we will make all versions of the Luxeed S7 available for purchase despite making a loss,” Richard Yu, the chief executive of Huawei’s consumer business group, told the media during a press conference in Shenzhen (our translation). This will allow more customers to try Huawei’s smart vehicle technology at an affordable price, said Yu.

The aggressive pricing strategy unveiled at the Luxeed S7’s launch marks the latest push by the Chinese technology giant to crack the world’s biggest and most competitive electric vehicle market. Huawei hopes it will be a new revenue source to offset the negative impact of US restrictions on its smartphone business. 

Here’s what we know about the newly-launched Luxeed S7 sedan:

Pricing: The sedan comes at a minimum price of RMB 258,000 ($35,381), RMB 2,000 lower than Tesla’s entry-level Model 3 in China. Pre-sale started on Thursday and the official launch is scheduled for Nov. 28.

Automated driving: The Huawei-Chery electric sedan is the first model to use the tech giant’s latest proprietary Harmony operating system. Its autonomous valet parking feature enables the car to park itself in lots and then return to a designated spot using a remote-control assisted function.

The premium versions of the Luxeed S7 will include Huawei’s laser sensor units and its Advanced Driving System (ADS) that uses deep learning networks and computer vision algorithms, including one called the General Obstacle Detection network, for navigating its surroundings. 

Huawei has claimed its partially autonomous driving technology will be accessible on major city roads across China by the end of the year, potentially ahead of rivals including Xpeng Motors. 

Main specs: Yu specifically identified Tesla’s Model S as Huawei’s major competitor, claiming that Huawei and Chery’s full-size luxury sedan outperformed its rival’s in terms of range, energy efficiency, and luxury. 

The top-end Luxeed S7 will have a driving range of more than 800 kilometers (497 miles) and be capable of driving another 400 km on 15 minutes of supercharging using Huawei’s facilities. By comparison, the dual-motor Tesla Model S has a 715 km range and can add 347 km in 15 minutes. 

The car also impresses with high energy efficiency, consuming an estimated 12.4 kWh per 100 km, compared with 13.2 kWh and 17.5 kWh achieved by the rear-drive Model 3 and the dual-motor Model S respectively. “This is far ahead of our rivals,” said Yu, using a phrase that has become a Huawei-related buzzword on the Chinese internet. 

The S7 slightly beats out the Model S with a drag coefficient of 0.203. Meanwhile, it offers a 0 to 100 km/h (62mph) acceleration of 3.3 seconds, just under the 3.1 seconds reported by the Model S performance version but faster than the Porsche Taycan 4S, according to Yu. 

Interior: The sleek, aerodynamically favorable sedan boasts of a larger cabin space than its major luxury competitors with an interior length of 1,910 mm. The Mercedes E300L and the Tesla Model S measure 1,898mm and 1,816mm in interior length respectively, according to figures cited by Huawei during the press conference. 

The S7 also comes with a sporty design concept for the inside, featuring a wide dashboard, a 12.3-inch smart screen, as well as an oval-shaped steering wheel, allowing drivers to see the whole display, rather than having to view it through the steering wheel. 

In addition, it has adopted so-called zero gravity seat technology for the front passenger seat. This allows the human body to take on a neutral spinal posture, reducing the amount of stress placed on bones and joints, while the backs of the rear seats are heated, ventilated, and 27/32° adjustable.

READ MORE: Huawei-backed Aito now has 50,000 orders for its redesigned M7 model

Temu, the e-commerce platform celebrated for its cut-rate prices, has launched a legal offensive against fraudsters who masquerade as the company. These imposters lure customers into downloading bogus apps that infest devices with malware and pilfer personal data, according to lawsuits filed in the US in the past two weeks.

Boston-based Temu, operating under its legal name Whaleco, has filed suit against seven websites accused of deceptively prompting visitors to download a counterfeit app. The aim, the lawsuit claims, is to snatch personal details from Whaleco’s clients, slip malware onto their devices, or hack into them. This legal move, initiated on November 7 in a U.S. court, comes on the heels of Temu’s earlier legal action against twenty websites for trademark violation and orchestrating internet phishing scams to defraud consumers.

“Fraudsters are posing as Temu on fake apps and websites to scam consumers. This not only damages our reputation but also hurts consumers who were deceived into believing they were engaging with genuine Temu platforms,” said a Temu spokesman.” We will take swift legal action to defend our rights and shield our customers from such malicious and unlawful activities.” 

In the year since Temu launched in the US, it has soared in popularity, propelled in part by its “Shop Like A Billionaire” Super Bowl commercial. Now, the e-commerce contender has broadened its reach, serving customers in 48 countries, from the UK to Malaysia.

Sensor Tower data reveals that Temu broke into the global top 10 most downloaded apps list in the second quarter of 2023, surpassing both its rival Shein and the American titan Amazon in downloads. Further, a data.ai analysis reported by CNBC shows that Temu has outstripped Shein in Japan and South Korea, clinching the top spot in shopping app rankings over an extended stretch.

Wendy Chen, a GAM Investments senior investment analyst, points to Temu’s innovative “fully entrusted business model” as the engine of its meteoric rise. This model blends direct retail sales with a marketplace for third-party vendors, drawing on the strengths of both. Temu streamlines its operations by sourcing directly from manufacturers, who are tasked merely with shipping to Temu’s global warehouses. The company then takes the reins, overseeing customer acquisition, pricing, logistics, and customer service.

This strategy affords Temu the quality control, timely delivery, and customer satisfaction of a first-party model, while it still benefits from the extensive selection and scalability of a third-party model. By connecting factories directly with consumers, Temu not only slashes middlemen expenses but also sidesteps the hazards of overstocking, Chen explains.

According to a recent report by Chinese tech media outlet 36 Kr, the US market, the first destination Temu entered, currently contributes 60% of the platform’s overall sales. The same report stated that the platform’s third quarter sales surpassed $5 billion, and the extraordinary pace of growth may allow Temu to exceed its annual GMV target of $15 billion this year.

“We are in a cost-of-living crisis and people are looking for anything to save a bit of money,” Miya Knights, the publisher of Retail Technology magazine, told the Guardian. “Everyone likes a bargain and Temu ticks those boxes.”

To be sure, Temu’s popularity has come at a price, with a small group of scammers capitalizing on the company’s reputation to launch phishing schemes and install malware, according to its lawsuit. Critics have also accused Temu of intrusive data practices, allegations that Temu has sought to dispel by prominently listing the permissions that it seeks from users. 

In its latest lawsuit, Temu accuses websites such as Dltemuapp.com and temudl.net of mimicking Temu’s domain name and describes them as primarily designed to lure consumers into making purchases or to mislead unsuspecting consumers.

“Bogus websites like these serve as a platform for various cybercrimes. They could be used to extract sensitive and financial information from duped consumers. They could be used to install malware on people’s sites (and/or those of their employers) to steal information or install viruses and serve as leverage for large ransoms,” Temu said in its lawsuit.

“In any of these scenarios, the results would be devastating—and the harm irreparable–to (Temu) and the public alike,” according to the lawsuit.

Meanwhile, Temu has intensified efforts to warn consumers about fake Temu promotions and scams. The company has also advised users of the importance of downloading the official Temu app from the Apple Store and Google Play Store, which have stringent vetting controls.

Chinese video giant ByteDance will conduct a new round of layoffs from its virtual reality arm Pico as demand for headsets was not “as fast as expected,” said chief executive Henry Zhou, acknowledging at an internal meeting that projections for VR had been overly optimistic.

Why it matters: This large-scale downsizing is the latest restructuring effort by ByteDance in response to dim prospects in the VR industry. Despite significant investments in technology and marketing over the past two years, which failed to yield satisfactory sales results, the company has stated its intention to keep its hardware team intact.

Details: The biggest overhaul since Pico was acquired by the TikTok owner two years ago was announced in a ten-minute meeting on Tuesday, with staff from sales, videos, and platform operations hit the most.

• Although the exact percentage of layoffs was not disclosed by the company, a source close to Pico told local media outlet VR Tuoluo saying around half of its VR staff would be affected.
• In February, Pico slashed nearly a third of its positions, equivalent to hundreds of jobs, mere months after ByteDance launched the flagship Pico 4 VR headset, benchmarked against Meta’s Quest 2. Recent layoffs will shrink the workforce to only a few hundred employees, down from a peak headcount of over 2,000.
• Affected employees will be compensated based on their years of service plus one month’s salary, according to Tencent News.

Context: ByteDance acquired Pico for approximately RMB 5 billion in 2021, and launched an extensive marketing campaign for the Pico 4 standalone VR headset when it was launched a year later. The company enlisted musician Leah Dou and ping-pong star Sun Yingsha as spokespeople, covering major shopping malls and bus stops with advertisements. 

• The TikTok owner has high hopes for its VR business, as Pico founder and president Henry Zhou said at last year’s launch event, expecting the headset to sell more than 1 million units eventually. However, early this year, the company lowered its sales target to “slightly over 500,000 units” due to disappointing initial results.
• The Pico 4 boasts a total of 561 apps, according to figures compiled by VR Tuoluo, surpassing Quest’s 532. The report quoted a source as saying ByteDance had spent at least several billion yuan on building a content ecosystem within Pico.

The CEO of Chinese GPU (graphics processing unit) maker Moore Threads, Zhang Jianzhong, sent an open letter to staff on Monday, stating that the company would begin layoffs within a week, according to a report by local media outlet Icsmart. In the letter, which comes just weeks after the company was added to the US government’s restricted Entity List, Zhang also said “There are no darkest hours for Chinese GPU makers, only boundless possibilities.” 

Why it matters: On Oct. 17, the US government implemented a series of new restrictions, limiting the export of more advanced AI chips and semiconductor equipment to China. As one of 13 Chinese companies now added to the Entity List, Moore Threads and its subsidiaries have been substantially impacted by the policy.

Details: In his letter, Zhang directly blamed the impact of US sanctions on Moore Threads’ personnel cuts. The company will now undergo a restructuring, with plans to establish two new divisions: an AI strategy group and a metaverse computing strategy group.

• The exact number of employees facing layoffs at Moore Threads has not been disclosed, and the size of the company’s total workforce before the job cuts remains unknown. However, the company’s LinkedIn page shows a range of 500 to 1,000 employees.
• In the open letter, Zhang claimed that the entire domestic GPU and AI chip industry has been severely impacted by the new limits, but that nothing could deter the company’s determination to move forward. Moore Threads will continue to build high-quality GPUs in China at the juncture between challenges and opportunities, he stated.
• To address the challenges brought by the external environment and policy changes, Zhang announced a three-year plan. The company will focus on four key areas: accelerating independent research and innovation, refining high-quality products, promoting application implementation, and building efficient teams.
• On Oct. 31, the spokesperson for the China Council for the Promotion of International Trade, Zhang Xin, stated that the US measures violate market economic principles and international trade rules, exacerbating fragmentation and risks in the global semiconductor supply chain. 

Context: Established by Zhang, the former global vice-president of Nvidia and general manager of Nvidia China, in October 2020, Moore Threads is a Chinese technology company specializing in graphics processing unit design. The firm has developed two consumer-grade cards for China’s domestic gaming segment, including the MTT S80 and the MTT S70. 

• Chinese retailers are currently offering promotions for the annual 11.11 Singles’ Day shopping festival. Among these deals, the MTT S80 and MTT S70 GPUs are available at their lowest prices ever. The MTT S80 has been reduced from RMB 2,999 ($412) to RMB 1,199 ($165), while the company has cut the original price of the MTT S70 from RMB 2,499 ($343) to RMB 899 ($124).

Xpeng Motors said on Nov. 3 that it will offer some existing owners of its P5 sedan discounts on new purchases after hundreds of customers accused it of failing to deliver promised advanced driver assistance features, which were supposed to be available across the country. 

Why it matters: The complaints, which went viral on Chinese social media last week, mounted after Xpeng on Oct. 24 unveiled plans to roll out its latest advanced driver assistance system (ADAS), the XNGP, nationwide by next year. The company said it will be applicable to existing models including the G6, G9, and P7i, without mentioning the P5. 

Details: Xpeng said in a statement issued on Nov. 3 that it will offer an RMB 20,000 ($2,747) coupon for people who have subscribed to Xpilot, its previous generation driver-assist software, along with their purchases of the premium version of the P5 sedan. The benefit could be used for a new purchase of one of Xpeng’s most popular models, including the G6, G9, P7i, or its upcoming X9 van. 

• The announcement comes after more than 700 P5 owners recently published an open letter, obtained by National Business Daily, asking the company for an explanation as to why its partially autonomous feature for urban driving has remained unavailable to them in most domestic cities, despite the company’s promises.
• Xpeng further explained that the availability of its previous-generation ADAS feature “relies heavily on” high-definition maps, which has reportedly required automakers to secure approval for using mapping data in their vehicles, partly resulting in slow progress in adoption (our translation). 
• The EV startup released the so-called City Navigation Guided Pilot (NGP) function first to Xpilot users in the city of Guangzhou last September and has since expanded the adoption to five major cities including Beijing, Shanghai, and Shenzhen. 
• “We will strive for more new features and improved user experience, despite many challenges,” Xpeng said in the statement, adding that more functions will be available to P5 owners through over-the-air updates next year, including steering assist and more music streaming apps. 

Context: Xpeng began delivery of the P5 electric sedan back in October 2021, with its premium versions featuring two lidar sensors to facilitate more reliable automated driving functions at a price range of between RMB 199,900 and RMB 223,900 ($27,453-$30,749). It sold 19,618 units of the car over the last 12 months, according to figures from the auto services portal Dongchedi.

• The automaker is shifting to a more affordable approach for autonomous driving, which will reduce its reliance on technologies such as lidar and HD maps as part of a plan to roll out its XNGP system in 50 domestic cities by December. 
• The Xpilot system, formerly Xpeng’s rival to Tesla’s Autopilot system as reported by CNBC, is unavailable for driving scenarios without the support of HD maps, according to a Q&A document published by the company last November.

On Thursday, China’s Ministry of Industry and Information Technology issued guidelines on developing humanoid robots, stating that the robots may be the next groundbreaking products to reach consumers after computers, smartphones, and new energy vehicles. The government’s “Opinions on the Innovation and Development of Humanoid Robots” outlines goals and timelines for the new sector in China.

Why it matters: Humanoid robots incorporate advanced technologies, including artificial intelligence, high-end manufacturing, and new materials. With the potential to be a new competitive frontier in future industries, the government plans to promote innovation in key technologies by strengthening policies and mobilizing resources, given that China’s humanoid robot industry is in its budding phase.

Details: According to the guidelines, China expects to have a domestic ecosystem for humanoid robots established by 2025. By that time, robotic products are likely to be in mass production, fast catching up with international contenders.

• The ministry’s guidelines outline ambitious goals. By 2025, the country aims to nurture two to three world-beating companies, establish a cluster of specialized small- and medium-sized enterprises, and create two to three industrial development hubs. 
• By 2027, China is expected to establish a reliable industrial supply chain, with products from this sector seamlessly integrated into the real economy, as stated in the guidelines.
• The guidelines propose promoting artificial intelligence technologies with a focus on breakthroughs in key areas such as the “brain”, “cerebellum” and “limbs.” The “brain” encompasses core technologies of humanoid robots based on large AI models, while the “cerebellum” involves the robot’s environmental perception, behavior control, and human-machine interactive abilities. The “limbs” refers to humanoid mechanical arms, hands, legs, and feet. The emphasis is on addressing key technologies, including lightweight skeletons, high-strength body structures, and high-precision sensors.
• The guidance also outlines measures for expanding the application of humanoid robots in specific areas, including electronics, automotive, healthcare, services, agriculture, logistics, and even specialized industrial environments where humans currently undertake dangerous tasks in harsh conditions.

Context: The global market for humanoid robots, valued at $1.11 billion in 2022, is projected to experience a compound annual growth rate (CAGR) of 21.1% from 2023 to 2030, according to a report by Grand View Research. There is already rising demand from public and corporate subsidy funds for specific goals, guiding research in humanoid robotics, as well as progress in various fundamental aspects of this field like improved AI, natural language processing, and robot dexterity.

Chinese electric vehicle makers Xpeng Motors and Aito on Wednesday posted record-breaking figures for monthly deliveries, as the pace of adoption of self-driving technology accelerates among local customers despite slowing growth in China’s electric vehicle segment as a whole. 

Strong orders for Huawei, Xpeng, and DJI’s city NOA (Navigation on ADAS) products mark the start of the commercialization of smart driving, Jefferies analysts wrote in an Oct. 24 note. They added that Chinese automakers are becoming more willing to “test the waters” with chips by Huawei on some of their vehicles.

Why it matters: The latest figures highlight a brutal price war that has been continuing for months in the market, and the struggle automakers are facing in having to choose between lower prices or losing market share. 

• Xpeng in June unveiled the G6, its crossover answer to Tesla’s Model Y, at a price tag 20% lower than its US rival in China. Aito’s all-new M7 sports utility vehicle now costs RMB 40,000 ($5,468) less than the version launched a year ago.

Riding the self-driving boom: Xpeng Motors handed over 20,002 electric cars to customers in October, crossing the 20,000 unit milestone, nearly a threefold increase from a year ago and  31% growth from September. 

• Aito also reported a record delivery number of 12,700 units last month. The Huawei-backed brand does not report its delivery figures consistently, but its Shanghai-listed manufacturer Seres posted sales of 40,389 EVs for the first nine months of the year. 
• The two companies appear to have taken an early lead in an emerging battlefield for partially autonomous technology among consumer carmakers. More than half of the orders of Aito’s redesigned M7 SUV were placed for versions with Huawei’s Advanced Driving System, Chinese media outlet Caixin reported on Oct. 7, citing company insiders. 
• The Max versions of Xpeng’s G6 crossover, which features the company’s XNGP assisted driving technology, accounted for 70% of total orders in the first month after the launch, chief executive He Xiaopeng said in August. Both companies said their vehicles would be able to travel autonomously most of the time in dozens of major Chinese cities by the end of the year. 

EV startups: Li Auto also accomplished a delivery milestone last month, distributing 40,422 vehicles, making its year-to-date deliveries 284,647 units, the highest among the country’s nascent EV startups. The company has upped its goal to 50,000 units for the remaining two months of the year, CEO Li Xiang said on Wednesday on the Chinese Twitter-like platform Weibo.

• NIO’s October delivery of 16,074 units represented a 59.8% growth from this time last year and a slight 2.8% increase month over month. The company has delivered 126,067 vehicles as of October this year, still far from the annual goal of 245,000 units revealed by CEO William Li in March. It is now aiming for monthly delivery of more than 20,000 units in the fourth quarter of 2023. 
• Leapmotor’s delivery of 18,202 EVs last month comes after the Zhejiang-based EV maker recently announced a deal with European major Stellantis for a $1.6 billion war chest and turned its negative gross margin into a positive for the past quarter. Rival Hozon delivered 12,085 units, representing a decrease of 32.9% year-on-year and 8.5% month-on-month. 

Established majors: BYD’s growth momentum continued to some extent in October as the company saw sales surpassing 301,000 vehicles with a mild 5.2% rise from a month earlier. Analysts expect China’s biggest EV maker to achieve its annual goal of selling 3 million cars this year, as the company on Monday launched a wagon version of its popular Song SUV and readied to sell its long-anticipated Bao 5 off-roader.

• Sales for Aion declined 19.6% from a month earlier to 41,503 units, as the GAC subsidiary ramps up production of its new models, company insiders told financial media outlet CLS. Changan-affiliated Deepal delivered 15,513 vehicles in October, a 10.7% decrease from September. 
• Zeekr delivered 13,077 vehicles last month, up 29.2% from a year ago and 8.5% from September. On Aug. 11, the two-year-old premium EV brand, set up by Volvo parent Geely, cut the price of its 001 hatchback by up to RMB 37,000 to RMB 269,000 for a limited period until the end of this year. 
• Voyah saw its deliveries grow 21% on a monthly basis in October after the Dongfeng-backed EV maker launched its redesigned Free SUV in August, with the model arriving 15% cheaper than the previous version and equipped with Baidu’s advanced driver-assist system. 

Context: Retail sales of new energy passenger vehicles, including all-electrics and plug-in hybrids, are expected to reach 750,000 units in October, up 34.6% year-on-year and 0.9% month-on-month, according to estimates from the China Passenger Car Association. The past two months, known as “Golden September, Silver October,” are traditionally peak seasons for auto sales in China.

China’s most populated social media platforms on Tuesday announced they will soon remove anonymity for content creators that have over 500,000 followers, confirming rumors that stirred up heated debate over personal privacy in recent weeks.

Why it matters: The new policy will force bloggers with large fan bases to disclose their real names to the public on social media, in a change to the rules that will likely further deter discussion online in China, especially when it comes to finance news and current affairs.

Details: At least seven social platforms serving hundreds of thousands of users daily issued statements urging influencers to reveal their real identities. These included X-like platform Weibo, messaging app WeChat, video sites Douyin, Kuaishou, and Bilibili, as well as lifestyle-sharing app Xiaohongshu and search giant Baidu. 

• Weibo has outlined plans to first require creators specializing in content related to social affairs, finance, and legal matters, with more than 1 million followers to post using their real names,  before extending the rule to bloggers in other fields.
• Influencers who refuse to show their real names may be limited by account traffic and revenue, according to Weibo and WeChat.
• WeChat said the move will  enhance the credibility of top “self-media” accounts, while Weibo said that as these influencers have a far greater impact on public opinion than ordinary users, requiring real name identification will encourage them to “take on responsibilities that align with the influence of their words.”
• In recent years, China has strengthened the management of social media accounts run by individuals or organizations independent of state-control. Many of those accounts have amassed sizable fanbases.
• Short video apps Kuaishou, and TikTok’s Chinese sibling Douyin, were among the platforms that published simultaneous statements. Accounts with over 500,000 followers will be the first affected by real-name ID disclosure requirements. Kuaishou added that accounts mainly sharing personal daily life stories will be exempt.

Context: On Oct.21, users noticed that Weibo’s CEO Wang Gaofei gave his real name on  his social media page, a move later confirmed by the executive who said he had decided to first test the policy on his own account.

• A year ago, China asked that posts mentioning Russia’s invasion of Ukraine showed the location of the poster, in response to an incident in which a social media user faked his whereabouts, causing a stir in overseas media. Shortly after, the practice of displaying IP addresses was extended to individual users of Weibo and those of other social media platforms.

Chinese telecom giant Huawei has applied to register the trademark Far Ahead in the fields of transportation tools and scientific instruments, according to China’s trademark platform Tianyancha. “Far ahead” became a trending term on the Chinese internet after the surprise early release of Huawei’s Mate 60 series of smartphones in August, which came with advanced chipsets despite the Chinese tech company being a major target of US sanctions. The trademark is currently pending review. 

Why it matters: Having seen its tech capabilities limited by US chip sanctions, Huawei has ridden a wave of nationalist approval in China following the release of its Mate 60 line, which came equipped with a better chip and higher processor power than many industry observers had thought possible. 

Details: Yu Chengdong, CEO of Consumer Business at Huawei, has repeatedly used the phrase “far ahead” to describe the tech gap between Huawei and its competitors during product launches. Huawei fans often use the phrase as a rallying call on social media. Huawei’s detractors have also utilized this term to satirize the company’s advertising and messaging.

• Huawei’s use of the term “far ahead” first came at the launch event of its Mate 40 smartphone in 2020, according to local media outlet ThePaper. During a presentation of the Mate 40’s features, Yu used the phrase 14 times. Last year, Yu again used “far ahead” to describe the advanced satellite messaging function of the Huawei Mate 50 series, further boosting the popularity of the phrase in China.
• In August 2023, Huawei launched the Mate 60 Pro series, featuring the self-developed Kirin 9000s chip, manufactured in China by Semiconductor Manufacturing International Corp (SMIC). Related short videos with the tag “Far Ahead” went viral on the Chinese internet. For instance, videos on Douyin (the Chinese version of TikTok) with this tag have gained 960 million views.
• Huawei reportedly plans to ship between 60 to 70 million smartphones in 2024. Sources have told local media outlets that Huawei has placed sufficient orders from its supply chain to guarantee the fulfillment of this shipment goal for the year 2024.
• On Oct. 27, Huawei released details of its sales performance for the first three quarters of 2023. During this period, the firm achieved sales revenues of RMB 456.6 billion ($62.39 billion), representing a year-on-year increase of 2.4%, with a net profit margin of 16%. Huawei stated that these results were in line with expectations, though the company did not disclose specific figures for its various business streams during the period.

Context: Thanks to the newly launched Mate 60 series, Huawei’s domestic shipments in the third quarter increased by 37% compared to the same period last year, according to market research firm Counterpoint. Huawei’s share of China’s smartphone market has risen to 14%, making it the fifth largest company in the sector. 

• On Monday, Huawei announced that downloads of its HarmonyOS 4, which was unveiled in August, had topped 100 million. One of the key updates in HarmonyOS 4 is the ability to customize the home screen, allowing users to change system fonts, colors, clock styles, and widgets according to their preferences.

Chinese automaker Geely on Oct. 27 unveiled its biggest bet ever on intelligent vehicles with the launch of the first Jiyue-branded model, which the company says is capable of driving itself on busy urban streets in partnership with search engine Baidu. 

The automaker stated its vehicle relies heavily on a camera-based approach to capture detailed visual information and then respond appropriately, removing expensive laser sensors from its hardware suite to keep costs down. Tesla is reportedly a rare advocate for using the so-called vision-only approach, while most other brands opt for multiple sensors to mitigate safety concerns of their self-driving technologies. 

“I believe we provide users a better self-driving experience [than existing players] in most major Chinese cities,” Luo Gang, Jiyue’s chief operating officer, told reporters during an interview, adding that the Jiyue 01 outperforms Tesla’s offerings in digital services such as its AI assistant (our translation). Tesla’s full self-driving (FSD) function is currently unavailable in China. 

The Jiyue 01, a battery sports utility vehicle, comes in two versions with a price range between RMB 249,900 and RMB 339,900 ($34,148-$46,446), slightly lower than its pre-sale price and differing based on acceleration, driving range, and number of electric motors, among other specifications. Customers are also encouraged to pay RMB 19,900, a 60% cut from its sticker price, for all the premium functions of its self-driving software. 

Here are some of the news and highlights from the launch event held in Shanghai by Jiyue, formerly known as Jidu before Geely and Baidu set up a new venture in August. 

Self-driving tech: Jiyue said its advanced driver-assistance system, the Robo Drive Max, is already available to drivers in Shanghai, Hangzhou, and Shenzhen, meaning the cars can navigate complex urban streets in the three big cities with autonomous features such as overtaking, lane changing, and on-ramp/off-ramp driving. The firm is targeting nationwide availability for the software by 2024, which would mean it matched rival Xpeng. 

• Chief executive Joe Xia claimed the car could drive itself from point to point without many user interventions by using less costly high-definition maps and training multiple neural networks such as occupancy networks in big data sets, rather than relying on lidar. Rival Xpeng is also removing two radar sensors for its upcoming MPV model but retaining lidar technology for enhanced safety, TechNode has reported.
• The five-seater Jiyue 01 is equipped with 11 cameras and 17 ultrasonic sensors and radars. The company believes it is building public confidence in autonomous car safety, as Baidu has tested its autonomous car fleets without accidents for more than 70 million kilometers (43.5 million miles). Baidu has been handling various corner cases over the past decade, which greatly improves the safety of the system, said Luo. 

Smart cabin: The Jiyue 01 also boasts the most advanced voice recognition software on the market for in-car services, which can respond intelligently in milliseconds without losing its connection, as the company deploys artificial intelligence models and moves data analytics from cloud computers to the vehicle. The system is also set to evolve and become more alert to the needs of its owners, powered by Baidu’s ChatGPT-like chatbot, Ernie Bot. 

• Notably, the automaker is bringing voice activation outside the car, saying it is the world’s first model that allows autonomous valet parking via just a spoken command without the driver sitting in the car, from as far as two kilometers away, according to an announcement. A company employee demonstrated the feature with several reporters joined by TechNode in an indoor parking lot on the sidelines of the event. 
• Xia added that the vehicle’s in-car system is powered by Qualcomm’s most advanced smart cockpit computing platform, the SA8295, which provides a processing power of over 60 trillion operations per second (TOPS), compatible with that of flagship smartphones available on the market. This would allow users to play the hit racing game Asphalt with a 35.6-inch display across the dashboard, as would NIO owners do with their handsets and a smaller screen. 

READ MORE: Baidu’s EV firm Jidu aims to take on Tesla

In the collective effort to fight climate change, CCUS (Carbon Capture, Utilization, and Storage) is one of the few frontline tools. Today, carbon dioxide (CO₂) is captured directly by power generation or industrial facilities, or even directly from the atmosphere. The captured CO₂ is then utilized or stored. If stored, it’s injected into deep geological formations for permanent storage. If utilized, carbon can be incorporated into several production processes.

But how many of us are aware of the size and scale to which CCUS is taking place in this day and age – and what happens to the carbon when it’s captured?

By capturing carbon dioxide emissions at their source, CCUS helps mitigate the overall effects of accumulated carbon in our environment. CCUS has its roots in decades of scientific exploration – back to the 1930s. Official figures from bodies like the International Energy Agency (IEA) reveal a significant increase in CCUS projects globally, with over 30 large-scale facilities in operation or under construction (as of the end of 2020).

There is an estimated global CO₂ emission of 33 billion tons per year. The global capacity for carbon capture in 2021 was 43 million tons per year, accounting for just 0.1% of the emissions. The target is for CCUS to reach 10 billion tons per year by 2050, removing a third of our annual carbon emissions. While capacities are increasing year by year (the next goalpost is 279 million tons of CO₂ captured annually by the end of 2023, according to BloombergNEF’s report), very little of that captured CO₂ has been applied in innovative, practical, or useful formats.

Most of the captured carbon at present is pumped into storage wells underground – that’s the ‘S’ in CCUS, but not enough has been done for the ‘U’. Annually, only an estimated 270 million tons per year of CO₂ have been used, mostly on fertilizers, food, metal fab, and concrete. Yet for some of these uses, the CO₂ is re-released back into the atmosphere upon use, defeating the purpose of capturing it in the first place.

This is doubly inefficient: let’s not forget that CO₂ storage facilities need to be maintained and often occupy a very large area that isn’t used for any other purpose.

With 270 million tons/year of CO2 used versus 37 billion tons/year of CO2 emitted – we have a very long way to go.

CO₂: a useful yet misunderstood element

Earth’s CO₂ issue really is about too much of a good thing. Despite the negative climate-related connotations, CO₂ primarily is a very useful element and potential resource. Aside from the need for plants to achieve photosynthesis to produce oxygen, everything on earth is carbon-based.

As the Scientific American mentions, carbon is “the most versatile, most adaptable, most useful element of all. Carbon is the element of life.” 

From the chart we can see that carbon, through conversion, can be applied into fuels, to chemicals, to building materials, and so on. Direct uses of carbon include crop yield boosting, heat transfer media, or applications in food, welding, medicines, and more. The usefulness of carbon is remarkably broad, with plenty of potential waiting to be untapped.

Carbon has the ability to form stable bonds with many elements, including itself. This property allows carbon to form a huge variety of very large and complex molecules. In fact, there are nearly 10 million carbon-based compounds in living things. 

Take for example, the Chimei Asai facility in Taiwan, a joint venture of Asahi Kasei Chemicals and Chi Mei Corp. They have been manufacturing around 150,000 tons of polycarbonates per year using CO₂ as a starting material for over a decade. 

And at the price of $15 to 100 per ton, carbon as an abundant resource isn’t expensive at all. Being so affordable, we believe more research can be done to use carbon as a resource for practical outcomes.

Carbon utilization and removal pathways

To understand what we can work with when it comes to handling carbon, we have to understand the different formats of carbon capture: Closed, Cycling, and Open Pathways.

Of the three methods, ‘Closed’ is the most conservative, practical, and commonplace. ‘Cycling’ and ‘Open’ have their uses, but both require a large investment in time and resources to make it practical.

There are three methods to utilize captured carbon:

1) CO₂ Splitting: CO₂ can be split into different components, leading to various applications.

2) Synthetic Biology (synbio): CO₂ can be absorbed by microbes/algae to produce chemicals, food, or feedstock to make products.

3) Direct Incorporation: CO₂ can be directly incorporated into products.

Splitting carbon to make chemicals and fuels

Electrochemical splitting of CO₂ can create useful chemicals, such as syngas, Formic acid, Oxalic acid, and more. However, as CO₂ is an inert molecule, the science behind splitting carbon is very complex and expensive. Efficiency rates are also very low, often ranking below 50%. The molecule-splitting process also requires plenty of water. If we consider the cost and complexity of the entire process, it’s more efficient to use electrolysis to create hydrogen, a more energy-dense fuel that’s gaining traction globally.

Converting CO₂ into liquid fuels that substitute gasoline or diesel fuel only locks in carbon until the fuel is combusted, at which point it is re-released into the atmosphere.

Synbio process to produce fuels, chemicals, food, and materials

The synbio route is an interesting one, where startups use genetically modified microorganisms to absorb carbon to create useful chemicals.

Examples include using microbes to produce useful chemicals such as bioethylene or glucose. Copious amounts of carbon can also be used to accelerate algae growth, to turn it into an abundant feedstock to make food, biofuels, plastics, or even carbon fiber. But the systems are complex, requiring AI-powered photo-bioreactors for biomass production, requiring at least a two-stage dewatering process.

Generally, the science, research, and development behind using Synbio to decarbonize our climate is extremely expensive and complex, with many companies exploring this space going under.

Direct incorporation of carbon into things we live with

Direct incorporation is a much more practical method of making use of CO₂. Today it’s part of the cement-production process, which ‘locks in’ carbon for much longer. Concrete won’t permanently keep CO₂ out of the atmosphere, but can store it for a century or more, which counts as a form of effective carbon storage. The Nature paper calls these “closed” processes.

As the Nature paper says: “Cement requires the use of lime (CaO), which is produced by the calcination of limestone in an emissions-intensive process. As such, unless calcination is paired with carbon capture and sequestration, it is difficult for building-related pathways to deliver reductions in CO₂ emissions on a life-cycle basis.”

Ironically, cement production itself emits carbon, which needs to be captured and sequestered to make it carbon-neutral. With economies and standards of living around the world improving, and real estate constantly developing, cement production is now the seventh highest emitter of carbon into the atmosphere, with energy production taking the number one spot. So that presents a paradox to the solution.

Another common use of captured CO₂ is incorporation into fertilizers. However, once the fertilizer is placed in the soil, it’s re-released into the environment within weeks.

So, all that investment and effort in carbon capture and utilization vaporizes in just weeks. Is there any point in that?

Locking carbon into a material that doesn’t degrade: plastic

It’s a challenging goal: make use of abundant captured carbon, don’t let it reintegrate with our climate, and ensure it makes no additional contribution to carbon emissions in the process.

One highly plausible solution we’ve studied over the years is to incorporate carbon in something that’s very common in our everyday living: plastics.

As the IEA puts it: “CO₂-derived products that involve permanent carbon retention, such as building materials, can offer larger emissions reductions than products that ultimately release CO₂ to the atmosphere, such as fuels and chemicals.”

More accurately, carbon can be incorporated in polyol, a raw material that’s used to make plastics/PU/surfactants. These become useful materials that we use commonly, and often for a very long time: shoe soles, car seats, insulation, beds, paints, and more. When incorporated into plastics, it keeps carbon locked away for long periods, just like carbon in concrete.

As for the production process, making traditional plastics contributes to carbon emissions (though not as much as the concrete-making process). That’s because traditional plastics rely on fossil-based feedstocks. The aim of incorporating captured carbon in plastics is to replace these fossil-based feedstocks, effectively cutting down carbon emissions in the process.

From the above chart, it is clear that the most practical and profitable use of CO₂ is incorporation into polyol, a raw material for plastics. A UK startup that’s been developing this method effectively is Econic, which uses a catalyst to incorporate carbon into the PU production process. Best of all, it doesn’t call for additional energy requirements (keeping it carbon-neutral), and it fits seamlessly into existing plastic production processes.

As mentioned in an IEA paper: “Potential climate benefits in polymer production depend on the amount of CO₂ that can be absorbed in the material, which can be up to 50% of the polymer’s mass. For example, a polymer containing 20% CO₂ by weight shows life cycle CO₂ emissions reductions of 15% relative to the conventional production process.” 

Of course, there are controversies to this: plastics are the very material the world wants to avoid, because it doesn’t degrade well, polluting our seas and environment. Yet, it’s this very fact that helps to lock the carbon away for decades. Plastic isn’t something we can live without – from fundamental living needs to medical applications, it’s a functional, durable, and waterproof material that is nearly impossible to replace.

A system in which used plastics made from carbon are responsibly collected or recycled at the end of their use will help mitigate this concern.

Economic considerations: profitability and society

Is CCUS economically viable? If the carbon is mostly stored in geological locations, most probably not. But if captured carbon can become an abundant, key resource or raw material that supports our living needs – making buildings from concrete incorporated with carbon, food from carbon, or useful plastic goods made from carbon – it would become very practical. As the human population, cities, and needs grow, so do the needs for real estate development, sustenance, and functional products made out of plastic. Wouldn’t it be great to have ‘locked-away’ carbon serving our living needs while staying out of the atmosphere?

For now, the CCUS systems in place are very expensive investments with very low or no returns. This is in part because many haven’t found a practical solution as to what to do with all that captured carbon, or how to lock it in effectively without having it re-released into the environment.

CCUS represents a multifaceted approach to managing carbon emissions. It challenges conventional perceptions of CO₂ and opens doors to innovative uses. Though still a subject of debate and development, CCUS is emerging as an indispensable tool for a sustainable future, offering untapped opportunities for more responsible use of carbon, potentially revealing paths toward both environmental protection and economic benefits.

If we can unlock the potential of captured carbon – making it useful while keeping it out of the atmosphere – the rewards for society, businesses, and mankind could be profound.

Xiaomi Group on Thursday unveiled its new operating system, the Xiaomi HyperOS, and its new flagship smartphone Xiaomi 14 series. CEO Lei Jun said the company’s strategy had moved beyond “smartphone connections to AIoT (Artificial Intelligence of Things)”, and now entailed having the “phone, home, and vehicle all within an ecosystem.”

Why it matters: The Xiaomi 14 smartphone series showcases the Xiaomi HyperOS, an Android operating system that uses Xiaomi’s self-developed Vela system that enables the phone to connect with other AIoT devices. The lineup is touted by Xiaomi as the first flagship smartphone driven by Qualcomm’s latest processor Snapdragon 8 Gen 3, unveiled on Wednesday.

Details: In the next two years, Xiaomi HyperOS will replace its MIUI operating system across every Xiaomi smart device, as the company seeks to build a comprehensive ecosystem.

• Xiaomi plans to invest RMB 100 billion ($13.66 billion) in research and development (R&D) over the next five years, Lei Jun revealed at the launch event. Xiaomi also revealed that in 2022 it had invested RMB 16.2 billion ($2.21 billion), or 0.53% of its national R&D expenditure. 
• Xiaomi HyperOS is a cross-platform operating system that has been in development for seven years, involving 5,000 engineers, according to the company. Aiming to create a “people-vehicle-home” interactive ecosystem, Xiaomi has integrated its self-developed Vela system with a modified Linux system.
• The Xiaomi 14 series comprises the Xiaomi 14 and Xiaomi 14 Pro, both carrying the latest Qualcomm Snapdragon 8 Gen 3 chipset, as well as Xiaomi’s own Loop LiquidCool technology for heat dissipation. Both models feature Leica Summilux optical rear lenses.
• The latest Snapdragon 8 Gen 3, built using TSMC’s cutting-edge 4nm processor, is designed for AI applications and gaming, and comes with enhanced audio and camera features. The Gen 3 offers a notable improvement on its predecessor, being 30% faster and 20% more energy-efficient. Additionally, the chipset supports LPDDR5x memory at speeds up to 4,800 MHz and can accommodate up to 24 GB of RAM.
• Xiaomi has opted for a smaller sensor for the 14 Pro, introducing the Light Hunter 900 coupled with a custom Leica Summilux lens. Despite being approximately 44% smaller than last year’s 13 Pro 1-inch sensor, the new setup is up to 80% brighter, according to Xiaomi.
• Depending on storage requirements, a new Xiaomi 14 will cost from RMB 3,999 ($546) to RMB 4,999 ($683), with the pro version costing between RMB 4,999 ($683) and RMB 5,999 ($820).

Context: At the launch event, Lei also mentioned Xiaomi’s commitment to environmental protection and social responsibility, reiterating a pledge made in August to achieve carbon neutrality and to switch to 100% renewable energy by 2040. 

• According to intelligence firm Counterpoint, Xiaomi ranked fifth place in the Chinese phone market in the second quarter of 2023 with a 14% market share.

Since its inception in 2011, the CHINABANG Awards has been dedicated to identifying and nurturing the power of innovation in China. Over the last decade, we have witnessed many innovative enterprises such as DiDi, Momo, DJI, Mobvoi, Ele. me, WeChat, and the Little Red Book evolved from humble beginnings to iconic symbols of China’s innovation landscape. At the same time, we have uncovered many exceptional individuals, most of whom have ascended to become highly regarded trailblazers in their respective industries.

Now, the CHINABANG Awards 2023 is officially underway! Since its inaugural launch in 2011, the list has undergone more than ten years of refinement and enhancement, marked by the continuous evolution of our selection process. This year, we have made another breakthrough by setting up the CHINABANG Awards -China’s Overseas New Power List. The list is dedicated to recognizing overseas innovation teams with strong ties to China, identifying the most promising and valuable overseas projects, and striving to create the most open and credible annual overseas accolade in the industry.

The CHINABANG Awards China’s Overseas New Power List aspires to spotlight innovative companies that have achieved breakthroughs in international emerging markets, as well as the innovative organizations and individuals who have played a pivotal role in bolstering China’s global influence. We will recognize companies that continue to explore overseas markets, exporting China’s technological prowess and influence, as well as pioneering entities contributing to the sustainable development of local business ecosystems during the process of localization. Above all, we will acknowledge Chinese overseas entrepreneurs, innovators, and entrepreneurial teams who have exhibited unwavering dedication to innovation throughout their journeys.

China’s Overseas New Power: 4 Awards Categories 

Overseas Technology Company of the Year:

Aims to discover and recognize Chinese technology companies that have taken root and grown in overseas markets. These companies have not only achieved remarkable results in the international market but also successfully integrated into the local business ecosystem during the localization process, winning international recognition for China’s technological and innovative strength.

Overseas Investment Organization of the Year:

Aims to select investment institutions that are keen on identifying opportunities in overseas investment markets. They search for booming emerging markets in China and around the world, providing financial support and strategic guidance to innovative companies, and driving the expansion and growth of Chinese companies globally.

Overseas Service Organization of the Year:

Aims to identify and recognize service providers that can help Chinese enterprises with different needs and in different fields to realize cost reduction and efficiency, and to make goods available globally. Whether it’s in the areas of overseas brand creation, logistics management, payment systems, marketing strategies, or SaaS, these service organizations provide critical support to Chinese companies to help them become more competitive in the international market.

Overseas Pioneer of the Year:

Aims to reward the pioneers who are the first to step out of their comfort zone and expand overseas in the wave of Chinese enterprises going overseas. Their courage to take risks, innovate, and break the limitations of national borders has set a good image for Chinese innovators internationally, as well as a role model for other innovative entrepreneurs.

Award Description: Overseas Technology Company of the Year, Overseas Investment Organization of the Year, and Overseas Service Organization of the Year are enterprise awards. Overseas Pioneer of the Year is an individual award. All awards must be nominated and declared independently through the official nomination channel.

Eligibility of Enterprises Nomination

1. The applicant must be a legally registered company or a legal organization.
2. Must be a Chinese technology brand with at least 1 year of overseas business operation.
3. The submitted product/project/solution must be first marketed/published after December 1, 2022, or must be expected to be marketed before December 1, 2023, and the relevant intellectual property rights have been acquired.
4. The applicant must submit product images in .jpg format and less than 10 MB. In the case of intangible products, the applicant may submit screenshots or diagrams.

All nomination information must be submitted by 23:59 on December 31, 2023. Please complete as much information as possible for the subsequent selection, list announcement, and potential media coverage.

Description of Enterprise Selection Process

Nomination: Enterprises may nominate themselves by scanning the QR code below or clicking on the Link to access the official website’s exclusive nomination portal for submitting information.

Nomination deadline: 12/31/2023

Second Round: Select the list of enterprises/organizations/individuals who qualify for the final round.

Final Selection: The overseas lists of the year will be selected.

Selection Calendar

September – December 2023: Self-nominations;
December 31, 2023: Nominations closed;
January 2024 – Judge’s Second Road and Final Selection.

Award Entitlement

Brand Promotion

CHINABANG Awards is a brand that has accumulated prestige over more than a decade in the tech industry. Award-winning individuals and companies will receive the official certification and trophy from CHINABANG Awards.

International Stage (*within 1 year of official award announcement)

1. Award-winning individuals and companies will be recommended for inclusion in the BEYOND Awards shortlist, with the chance to secure a complimentary exhibition booth and on-stage presentation opportunity at the BEYOND International Tech Innovation Expo, where they can showcase the latest technologies and trends across various industries.
2. Award-winning individuals/companies will also be recommended for inclusion in the shortlist for the Origin Innovation Awards, hosted by TNGlobal. They will receive exclusive invitations to speak at the Origin Summit, becoming featured speakers at the event.
3. Award-winning individuals and companies will have the opportunity to participate in the “出海时刻” (Overseas Moment) dialogue program, a media brand created and produced by Dynamic Tech, where they can discuss industry development trends and share insights into the challenges and opportunities of expanding businesses internationally.

Media Exposure (*within 1 year of official award announcement)

For finalists and winners, we will conduct an extensive promotion on Technode’s English and Chinese media platforms, while national and international media networks will provide ongoing coverage. For award-winning individuals and companies, we offer the reward of five free featured interviews or press releases.

Resource Sharing (*within 1 year of official award announcement)

Through the specialized communication platform established by CHINABANG, connecting businesses, organizations, capital, and media, award-winning enterprises will enjoy convenient resource matching and sharing services.

*More benefits will be continuously updated on the official website.

In this era filled with opportunities and challenges, we look forward to exploring, recognizing, and promoting China’s overseas innovation forces alongside you. CHINABANG China’s Overseas New Power is not just an awards event; it is also an industry celebration. We cordially invite outstanding innovative companies, investment firms, experts, scholars, and media friends to join us in witnessing the brilliant moments of Chinese innovation!

About TNGlobal

TNGlobal, formerly known as TechNode Global, is a pan-Asian tech platform that delivers premium tech news, industry insights, events, and tailored marketing solutions to startups, VCs, corporates, and other industry pioneers. TNGlobal facilitates cross-border collaboration and business through its extensive network, strategic partnerships, events, and resources, bridging the gap between China and the broader Asian tech ecosystem market. The flagship events of TNGlobal include the ORIGIN Summit and the ORIGIN Innovation Awards. TNGlobal is also one of the key organizers of BEYOND Expo, Asia’s leading technology and innovation expo. TNGlobal is an overseas company of TechNode, China’s leading innovation and entrepreneurship platform.

Learn more about TNGlobal: https://technode.global

About BEYOND Expo

Established in 2020, BEYOND Expo has already successfully organized three editions, making it one of the largest and most influential international technology expos in Asia. Over the past three editions, BEYOND Expo has showcased numerous valuable technological breakthroughs and innovations, attracting over 70,000 participants, hosting more than 1,400 exhibitors, inviting over 600 business innovation leaders as conference speakers, and simultaneously holding more than 300 industry forums and over 500 networking events. This extensive track record highlights its success as an international technology exchange platform.

Themed “Embracing the Uncertainties”, BEYOND Exp 2024 is scheduled to take place from May 23rd to May 25th, 2024, at the Venetian Macao’s Cotai Expo. The event will continue to gather the latest achievements and innovative thinking from the global technology sector, providing an unprecedented technological extravaganza for industry businesses and technology enthusiasts.

Learn more about BEYOND Expo: https://beyondexpo.com

Chinese kitchen appliances brand Hauswirt said on Monday that it had sent a legal letter to JD after the retailer lowered the price of one of Hauswirt’s ovens “without authorization” amid intense online battles over price in the run-up to Singles’ Day. Hauswirt claims the reduction led to a dent in the company’s profits.

Why it matters: Competition over low prices in a bid to attract consumers has intensified as China’s biggest shopping extravaganza kicks off, with this case suggesting an increasingly dysfunctional and imbalanced e-commerce ecosystem.

• While JD’s staff have claimed that the platform subsidized the oven in question to sell it below its normal price, Hangzhou-based Hauswirt has stated that they are the ones who actually incurred the loss. 

Details: Hauswirt’s home beginner oven normally retails for RMB 699 ($95.50), but this week consumers can get it on JD for RMB 319.50, a discount of more than 50%.

• Top livestreaming influencer Li Jiaqi was also caught up in the fiasco after a WeChat screenshot, believed to have been posted by a member of JD’s sales staff, showed he had received a legal letter from Hauswirt. 
• The poster said the appliance brand had filed a complaint against him due to the sale price of the oven on JD being lower than the price the controversial livestream star advertised during his broadcasts, thus breaching Hauswirt’s lowest-price agreement with Li.
• The oven was set to be marketed on Li’s Taobao Live livestream on Oct. 26, according to a teaser on his official WeChat account earlier today. The post did not reveal the item’s exact price.
• Local media outlet Jiemian cited Li Jiaqi’s agency MeiOne as saying they didn’t sign a so-called minimum price agreement with Hauswirt and that “pricing of livestreamed goods rests with the brand.” However, it is not known whether MeiOne will still require other brands they cooperate with to promise the lowest price for their products in return for exposure on Li’s livestreams, a practice they have reportedly pursued in the past.
• As the high-profile spat continued, Hauswirt commented with three demands on JD’s official Weibo social media account on Tuesday, asking the e-commerce giant to withdraw the sale of the oven at half price, requesting that it exclude the brand’s entire product line from JD’s regular coupon offers, and urging JD to conduct an “internal review” to “rectify any unreasonable behavior.”
• At time of writing, the oven is currently being sold at RMB 699 on JD. JD did not respond to TechNode’s requests for comment.

Context: The conflict over pricing control between e-commerce channels is growing more prominent in China’s latest online price war. On the one hand, online retailers are pursuing low prices amid a less-than-stellar consumer recovery, but on the other, this is adding pressure to merchants that have set up online stores on multiple platforms.

• During 2021’s Singles’ Day festival, some users found that the same L’Oréal face mask product they bought via the country’s hottest livestreamers, Li Jiaqi and Viya, was more expensive than the cosmetics brand’s own livestream days later, which led the duo to publicly accuse L’Oréal of failing to deliver on its promise to offer them the lowest prices.

On Tuesday, US chip giant Nvidia revealed that the US government has instructed it to immediately halt the export of certain high-end artificial intelligence chips to China, as regulators have expedited the enforcement of new restrictions, which were originally scheduled to take effect from Nov. 16.

Why it matters: The US withdrew Nvidia’s 30-day exemption period for chip exports to China on Oct. 23, implementing the new regulation 24 days earlier than expected. Currently, Chinese customers, such as Tencent and ByteDance, can no longer obtain any AI-related products from Nvidia. 

Details: The US government notified Nvidia of the immediate implementation of export restrictions on AI chips starting Oct. 23, as per Nvidia’s announcement to the US Securities and Exchange Commission. The affected products include five GPUs (graphics processing units): A100, A800, H100, H800, and L40S.

• On Oct. 17, the US Department of Commerce announced a series of new restrictions on chip exports, addressing loopholes identified after the US imposed export limitations on chips last October. These new regulations broaden the definition of advanced AI chips and impose additional licensing requirements on chip products destined for over 40 countries and regions, aiming to prevent resale to China. According to the regulations, the new restrictions will take effect from Nov. 16.
• Following the implementation of the new regulations, Nvidia must cease shipping A800 and H800 chips to China unless it has express permission from the US government. A800 and H800 chips are alternative solutions Nvidia offered in place of the originally prohibited A100 and H100 chips, following the initial AI chip export restrictions imposed by the US last October. The Nvidia L40S, an advanced GPU for data centers, will also be affected by the new restrictions.
• Due to the widespread global demand for these products, the sudden acceleration of US restrictions is not expected to have a short-term impact on the company’s financial performance, Nvidia said in its announcement. 
• However, Nvidia CEO Jensen Huang earlier stated that the new ban is expected to significantly impact Nvidia’s sales in the Chinese market, though he added that the company remains committed to complying with US regulations. 
• Several AI industry professionals in China have voiced concerns and doubts over the new measures, according to a report by local media outlet TMTPost. They worry about the potential impact of the new restrictions on the future training of large-scale AI models in China, which could result in a tech gap compared to US-based AI companies like OpenAI.

Context: In August, Nvidia reported a fourfold increase in its Data Center revenue over the last two years, establishing itself as a leader in AI chips with a market share of over 70%. Nvidia’s stock continues to rise, as the company achieved a market cap of $1 trillion earlier in 2023.

• The data center sector comprises processors such as central processing units (CPUs), data processing units (DPUs), and graphic processing units (GPUs). GPUs are favored for AI applications due to their ability to handle multiple tasks simultaneously.