An autonomous driving bus in Guangzhou Photo: VCG

China's Ministry of Industry and Information Technology (MIIT) on Tuesday announced approval for the first batch of Chinese automobile manufacturers to test automated driving technology on public roads, in the latest move to promote the high-quality development of the intelligent connected vehicle industry.

A list of pilot cities for road-cloud integration of intelligent connected vehicles is expected to be announced in June, according to Cailian Press on Wednesday.

The Chinese automobile industry is experiencing a transition toward smart and intelligent vehicles, and experts said the latest move will strengthen the competitiveness of China's new energy vehicle (NEV) sector.

The approvals were granted to nine Chinese automobile companies - BYD, Nio, Changan Auto, GAC, SAIC, BAIC BluePark, China FAW Group, SAIC Hongyan, and Yutong Bus - which are mainly based in first-tier cities in China such as Beijing, Shanghai, and Shenzhen, according to a statement published by the MIIT on Tuesday.

The pilot program allows these automakers to operate level three autonomous driving systems on certain restricted roads, which means cars are conditionally self-driving without human intervention unless in case of an emergency.

The trial applications will be applied in passenger cars, trucks and busses in seven cities including Beijing, Shanghai and Guangzhou, according to the MIIT.

Currently, some products have met the conditions for mass production, the MIIT said, adding that more efforts will be made to promote the improvement of the functions and performance and the iterative optimization of the industry ecosystem, while ensuring safety.

Tesla's CEO Elon Musk is preparing to promote the company's Full Self-Driving technology in China, aiming to enable autonomous driving mode in Tesla cars, Reuters reported.

As of April 2024, China has approved more than 29,000 kilometers of test roads for smart connected vehicles, issued over 6,800 test demonstration licenses, and accumulated a total test mileage of over 88 million kilometers.

Chinese NEV makers are accelerating the adoption of autonomous driving technology. According to the China Passenger Car Association, the installation rate of L2-level and above assisted driving functions in new energy passenger vehicles reached 62.5 percent in the first two months of 2024.

As the Chinese automotive industry is transitioning to smart technologies, including intelligent driving and vehicle road-cloud collaboration, it shows the "overcapacity" hype is a false narrative, Wu Shuocheng, a veteran automobile industry analyst, told the Global Times on Wednesday

The expert attributed China's leading status in the NEV race to technological innovation, globally competitive industrial clusters, and leading supply chains and infrastructure.

The competitiveness of the domestic NEV sector continues to grow.

According to a Reuters report on Wednesday, electric vehicle maker Nio has won approval to build a third factory in China that would boost its annual production capacity to 1 million cars. "The capacity of our existing plants won't be enough to meet market demand. There is no overcapacity with Nio," it added.

"Chinese NEV companies have made substantial strides over the past few years, primarily driven by huge investment in key technologies such as intelligent cockpits, autonomous driving, and ultra-fast charging, which has ensured China's competitiveness in the global market," said Zhao Yuhui, vice president of Geely's EV brand Zeekr.

China's advantages in the new-energy industry have been achieved through open competition and continuous technological innovation, with Chinese companies having invested in research and development in the new-energy sector for over 20 years, China's Ministry of Commerce said on May 15.