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4 July 2025 – China is finalising a new regulatory framework for driver-assistance systems, aiming to strike a balance between rapid innovation and public safety. The move follows a fatal crash involving a Xiaomi SU7 sedan in March, which intensified scrutiny of assisted-driving technologies.
📋 Regulatory Overhaul in Progress
Authorities are drafting rules that will require systems to monitor driver awareness and ensure timely human intervention. Marketing terms like “smart” and “autonomous” remain banned under current regulations, which mandate driver engagement even when systems steer, brake, or accelerate.
🚦 Level 3 Technology in Focus
China is pushing toward Level 3 assisted-driving systems, which allow drivers to disengage in specific scenarios. Although validation tests with state-owned Changan were paused after the Xiaomi incident, Beijing aims to resume trials this year and approve its first Level 3 vehicle by 2026.
🔧 Industry Collaboration and Liability Measures
Regulators have enlisted Dongfeng and Huawei to help shape the new standards, with public consultation concluding this week. The rules will also introduce stricter liability for automakers and suppliers if systems malfunction—mirroring recent legislation in the UK.
📈 Market Dynamics and Competitive Edge
China’s domestic automakers, including BYD and Geely’s Zeekr, are rapidly deploying Level 2 features and preparing Level 3 models for mass production. More than 60% of new cars sold in China this year are expected to include Level 2 capabilities. Huawei claims its highway-ready Level 3 system has undergone over 600 million kilometers of simulated testing.
🌍 Global Implications
China’s proactive stance contrasts with slower regulatory progress in the U.S., where companies have voiced frustration over the lack of a unified framework. Analysts suggest that China’s “feel the stones to cross the river” approach—cautious yet ambitious—could give its auto industry a strategic edge.
