The race toward intelligent driving is accelerating as automakers and technology firms push the boundaries of innovation in 2025. With the industry shifting toward widespread adoption of autonomous features, major players such as BYD and Changan are taking bold steps to redefine the marketBYD, in particular, has captured attention by lowering the price threshold for advanced driver assistance systems (ADAS), ensuring that even vehicles priced under 100,000 yuan can access intelligent driving capabilitiesThis move signals a paradigm shift toward what some industry observers call "intelligent driving equality," where cutting-edge automotive technology is no longer confined to high-end luxury models but becomes an everyday reality for a broader consumer base.
This democratization of intelligent driving is creating ripple effects across the industry, particularly for domestic semiconductor companies that are striving to establish a foothold in a market long dominated by international giantsThe demand for automotive-grade chips has surged as automakers integrate AI-driven functionalities into their vehicles, and domestic chipmakers now see an opportunity to capitalize on this wave of transformation.
One notable collaboration that has gained momentum recently is between Hezhima Intelligent and Dongfeng Motor GroupAs part of this strategic partnership, Hezhima's Wudang series chips will be installed in select Dongfeng models, with mass production expected to begin in 2025. Additionally, the company announced that its Huashan A1000 chip family will be deployed in FAW's fuel-powered vehicles, marking a significant step toward unifying intelligent driving technology across both gasoline and electric platformsThis development underscores an industry-wide pivot toward versatile architectures that support multiple powertrains, ensuring a seamless transition as electrification gains traction.
For Hezhima Intelligent, mass production is more than just a business goal—it is a survival necessity
Advertisements
CEO Dan Jizhang emphasized in a recent interview that 2025 will be a decisive year for the domestic intelligent driving chip industryHe warned that any company waiting until next year or beyond to ramp up chip development risks losing vital investment opportunitiesThe competitive landscape is evolving rapidly, and as automakers fine-tune their supply chains, the market may not be able to support multiple domestic chip manufacturers indefinitelyThe ability to achieve large-scale production is, therefore, a key determinant of long-term viability in this space.
As intelligent driving technology becomes mainstream, high-speed Navigation on Autopilot (NOA) is poised to become an industry standardHowever, domestic chipmakers still face limitations in the high-performance segment, where international semiconductor leaders such as Nvidia continue to dominateHigh-end smart driving solutions for brands like NIO, Xpeng, and Li Auto remain heavily reliant on Nvidia's Drive Orin-X chip, which led the market in early 2024 with an installation base exceeding 1.09 million unitsTesla, with its proprietary Full Self-Driving (FSD) system, ranked second with 788,000 installations, further reinforcing the dominance of established global players.
In response, domestic semiconductor companies are intensifying efforts to break into the high-performance segmentHezhima, for example, has announced plans to launch its Huashan A2000 chip family by the end of 2024. This next-generation chipset aims to rival Nvidia's solutions, providing higher computational power to support the increasing complexity of intelligent driving algorithmsWhile achieving technological parity with industry giants is an uphill battle, the growing momentum among domestic players indicates a determined push toward greater market penetration.
Despite this optimism, local chip manufacturers still grapple with fundamental challengesUnlike software development, where iteration cycles are relatively fast, automotive-grade chip development is a long-term, capital-intensive process
Advertisements
The high cost of research and development, combined with stringent safety and reliability requirements, means that many domestic chipmakers remain unprofitableAccess to sustained funding is critical, but even with financial backing, competing against established semiconductor companies that have decades of experience remains a formidable challenge.
Hezhima's financial trajectory illustrates both the opportunities and risks associated with the sectorIn August 2023, the company became the first domestic autonomous driving chipmaker to go public in Hong Kong, a move that was soon followed by its rival Horizon RoboticsHowever, both companies have faced substantial financial losses in recent yearsIn its 2024 forecast, Hezhima projected revenues of 450 million to 500 million yuan, representing an impressive year-over-year growth of 44% to 60%. More notably, the company expects to achieve a net profit exceeding 100 million yuan, a dramatic turnaround from the nearly 4.86 billion yuan loss reported in the previous year.
According to Hezhima’s board, this anticipated recovery is driven by three key factorsFirst, the company has increased revenue from its autonomous driving product line, strengthening partnerships with leading automakers such as BYD, Dongfeng, and GeelySecond, the expansion into commercial vehicle applications has diversified its business model, ensuring a more stable revenue streamFinally, government policies supporting integrated vehicle-road-cloud systems have generated additional opportunities, particularly as urban infrastructure adapts to accommodate intelligent driving ecosystems.
Yet, even with positive revenue projections, the road ahead is far from certainDongwu Securities recently published a report highlighting the difficulties automakers face when attempting to develop their own system-on-chip (SoC) solutionsThe challenges are multifaceted—scarcity of top-tier chip design talent, exorbitant financial investments, and lengthy development cycles that often exceed five years, making in-house semiconductor development an inherently risky proposition
Advertisements
Advertisements
Advertisements