In a significant step towards the advancement of autonomous driving technology, China's Ministry of Industry and Information Technology has given the green light to nine domestic automobile manufacturers to test their automated driving systems on public roads. This landmark decision, announced on Tuesday, is set to bolster the high-quality development of the intelligent connected vehicle industry in China, as the country continues to make strides in the realm of smart and intelligent vehicles.
The nine Chinese automakers granted approval include industry heavyweights such as BYD, Nio, Changan Auto, GAC, SAIC, BAIC BluePark, China FAW Group, SAIC Hongyan, and Yutong Bus. These companies, predominantly based in China's first-tier cities like Beijing, Shanghai, and Shenzhen, will now have the opportunity to showcase their cutting-edge autonomous driving technologies in real-world scenarios.
Under the pilot program, the selected automakers will be permitted to operate level three autonomous driving systems on designated restricted roads. Level three autonomy entails conditionally self-driving vehicles that can navigate without human intervention, except in emergency situations. The trial applications will span across seven cities, including Beijing, Shanghai, and Guangzhou, and will involve passenger cars, trucks, and buses.
The MIIT has emphasized that some products have already met the necessary conditions for mass production. Moving forward, the ministry plans to focus on promoting the enhancement of functions and performance, as well as the iterative optimization of the industry ecosystem, while prioritizing safety as a paramount concern.
China's ambitious plans for autonomous driving extend beyond its borders, with Tesla CEO Elon Musk gearing up to promote the company's Full Self-Driving technology in the Chinese market. Tesla aims to enable autonomous driving mode in its vehicles, further intensifying the competition in the intelligent connected vehicle space.
The scale of China's commitment to smart connected vehicles is evident in the impressive statistics. As of April 2024, the country has approved over 29,000 kilometers of test roads, issued more than 6,800 test demonstration licenses, and accumulated a staggering 88 million kilometers of test mileage.
Wu Shuocheng, a seasoned automobile industry analyst, dismisses the notion of "overcapacity" in the Chinese automotive industry as a false narrative. He attributes China's leading position in the new energy vehicle race to technological innovation, globally competitive industrial clusters, and robust supply chains and infrastructure.
The competitiveness of China's NEV sector continues to soar, with companies like Nio winning approval to build a third factory in the country, potentially boosting its annual production capacity to 1 million cars. Zhao Yuhui, vice president of Geely's EV brand Zeekr, highlights the substantial progress made by Chinese NEV companies over the past few years, driven by significant investments in key technologies such as intelligent cockpits, autonomous driving, and ultra-fast charging.
SSE: 600104 (BYD)
Current Price: ¥268.50
Change: +3.2%
SSE: 600418 (Changan Auto)
Current Price: ¥16.20
Change: +1.8%
SSE: 601238 (GAC)
Current Price: ¥12.45
Change: +2.1%
SSE: 600104 (SAIC)
Current Price: ¥18.90
Change: +1.5%
The stock prices of the Chinese automakers granted approval for autonomous driving testing are experiencing an uptrend, driven by positive sentiment surrounding the MIIT's announcement. Investors are optimistic about the potential growth and competitiveness of these companies in the intelligent connected vehicle industry. The stocks have found strong support at their respective levels: BYD at ¥260.00, Changan Auto at ¥15.50, GAC at ¥12.00, and SAIC at ¥18.00. On the upside, resistance levels are observed at BYD: ¥275.00, Changan Auto: CNY 17.00, GAC: ¥13.00, and SAIC: ¥20.00. The 50-day moving averages are trending above the 200-day moving averages for all four stocks, confirming the bullish momentum. The MACD indicators have recently crossed above their signal lines, generating buy signals. The stocks have retraced to their respective Fibonacci levels, which often act as support levels during uptrends. BYD is trading near the 38.2% level, Changan Auto and GAC are near the 50% level, and SAIC is approaching the 61.8% level. The stock prices are trading near the upper Bollinger Bands, suggesting that the stocks are in overbought conditions. However, strong uptrends can sustain prices near the upper bands for extended periods. Overall, the technical analysis indicates that the Chinese automakers granted approval for autonomous driving testing are experiencing positive momentum, with their stock prices in uptrends. Investors should monitor key resistance levels and be aware of potential overbought conditions.
