NIO, BYD Receive Beijing's Approval For Autonomous Driving Tests Amid Tesla's FSD Launch Aspirations In China

BYD BYDDF BYDDY, backed by Warren Buffett, and NIO NIO are among the first automakers to receive approval from Chinese regulators to test their automated driving technology on public roads.

What Happened: China's Ministry of Industry and Information Technology announced late Tuesday that nine automakers, including BYD and NIO, have been approved to test automated driving technology, The Wall Street Journal reported. This approval applies to both truck and passenger car manufacturers.

The automakers can now test their automated driving functions in specific areas within seven approved cities, including major hubs like Beijing, Shanghai, Guangzhou, and Shenzhen. However, they must first conduct test and safety evaluations before actual road testing can commence.

This marks the first instance of Chinese authorities approving testing for level 3 and level 4 automated driving technologies. These levels allow cars to make informed driving decisions with minimal human intervention.

"Being able to test for L3 technology is the starting point of autonomous driving," BYD stated. The approval is expected to accelerate the application of automated driving technology.

According to Bocom International auto analyst Angus Chan, the approval will help automakers gather real road data in China, advancing their L3 and L4 auto-driving technology. Chan also noted that this move signifies the government's commitment to larger-scale testing of automated driving.

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Why It Matters: Tesla is also reportedly preparing to register its “Full Self-Driving” software in China, targeting a rollout by the end of the year. This move underscores the intensifying race among automakers to dominate the autonomous driving sector in China.

The approval for BYD and NIO to test automated driving technology comes on the heels of their recent collaboration. NIO partnered with BYD to launch a budget-friendly EV brand called “Onvo,” aimed at competing with Tesla’s Model Y. This partnership marks a significant milestone for both companies as they seek to expand their market share in the competitive Chinese EV market.

Additionally, China is heavily investing in the development of advanced battery technologies. The Chinese government is set to allocate over $830 million to advance solid-state battery technology. BYD and NIO are among the companies eligible to receive this funding, which aims to enhance battery safety, lifespan, and charging speed.

Buffett’s Berkshire Hathaway currently holds a 7.98% stake in BYD, after having pared down its stake from 20.49% earlier.

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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari