Domestic News - Shenzhen has issued the "2026 Automobile Replacement and Update Subsidy Implementation Guidelines," providing a one-time subsidy of up to 15,000 yuan for consumers who purchase new energy vehicles or fuel vehicles with an engine size of 2.0 liters or less after selling their old cars [6] - Hainan Province and Baidu have signed a strategic cooperation agreement to establish a smart connected vehicle industry ecosystem, focusing on cross-border data flow and the construction of an international autonomous driving center [7] - Jiangxi Province has upgraded its automobile replacement subsidy, allowing consumers to receive up to 20,000 yuan for purchasing new energy vehicles after scrapping old cars, with subsidies based on a percentage of the new car's price [8][9] - Horizon Robotics has showcased its new production model, iCAR V27, featuring advanced driving assistance capabilities powered by its Horizon SuperDrive technology [10][11] - NIO's founder announced plans for the "Firefly" brand, including the deployment of fifth-generation battery swap stations and expansion into global markets [12] - Avita has commenced the first delivery of its Avita 07 model in Thailand, marking the brand's global expansion [13] - Zeekr has officially entered the Italian market, signing a dealership agreement and planning further European expansion [15][16] - The world's first "robot + car" 4S store has opened in Beijing, integrating robotics into the automotive service experience [17] International News - Renault Group will unveil its new "futuREady" strategy on March 10, aiming to shift from creating individual success stories to building a sustainable success system [18] - Skoda has invested 205 million euros to establish a battery assembly plant in the Czech Republic, becoming the largest electric vehicle battery system producer within the Volkswagen Group [19] - General Motors plans to expand its used car business through its online platform CarBravo, discontinuing a long-standing warranty program for used cars sold by dealers [20] - TE Connectivity has acquired the electric vehicle charging interface business from Phoenix Contact E-Mobility, enhancing its service capabilities for major automotive clients [21] Commercial Vehicles - Proton Automotive has completed a multi-hundred million yuan Series B financing round to accelerate its development in the new energy commercial vehicle sector [23] - Joyson Electronics is set to launch its L4 autonomous driving domain controller in low-speed unmanned logistics vehicles, marking a significant step in domestic L4 applications [24] - Changan Automobile has initiated a "Changan Pickup Entrepreneurial Season" campaign, offering various financial incentives to support small business owners [25] - Jiangling Motors' representative has proposed lifting the mandatory scrappage age limit for non-operating pickups, suggesting policy adjustments to align with trends in the pickup market [26][27]

Investment Rating - The report suggests a positive investment outlook for the smart driving industry, particularly focusing on companies that can leverage cost advantages and regulatory benefits in the evolving landscape of intelligent driving technology [5]. Core Insights - The smart driving sector is expected to maintain high growth momentum, driven by the trend of "Smart Driving Equality 2.0," which will see advanced features like urban NOA (Navigation on Autopilot) becoming more accessible to consumers in the 100,000 to 200,000 RMB price range [1][12]. - The L2 level of autonomous driving is entering a strong regulatory phase, which will benefit testing institutions and lead to a significant expansion of the market for compliance testing [2][29]. - The concept of scaling law is identified as a deterministic technological trend, with advancements in end-to-end architectures approaching L4 level capabilities [3][50]. - The Robotaxi business model has shown initial validation, indicating that the industry is on the verge of a significant turning point, particularly with the potential success of Tesla's Robotaxi [4][50]. Summary by Sections Section 1: Smart Driving Equality 2.0 - The trend of smart driving equality is expected to strengthen, with urban NOA features penetrating the 100,000 to 200,000 RMB price segment, supported by robust supply and demand dynamics [1][12]. - The penetration rate of urban NOA hardware configurations is projected to increase from 16% in 2025 to 25% in 2026, with sales expected to reach 5.45 million units, reflecting a year-on-year growth of over 50% [1][12]. Section 2: L2 Regulatory Phase - The L2 level is entering a strong regulatory phase, with the implementation of stringent standards that will benefit testing institutions and expand the market for compliance testing [2][29]. - The L3/L4 autonomous driving regulatory framework is gradually being established, moving from local trials to a national legal framework [2][40]. Section 3: Scaling Law and Technological Trends - The scaling law is recognized as a key technological trend, with the end-to-end architecture reaching preliminary L4 thresholds [3][50]. - The demand for computational power on the vehicle side is expected to grow alongside the increase in model parameters, necessitating companies to develop integrated software and hardware capabilities to remain competitive [3][50]. Section 4: Robotaxi Business Model - The Robotaxi model has been validated through successful regional operations by leading L4 manufacturers, indicating a growing consumer demand for such services [4][50]. - The success of Tesla's Robotaxi is seen as a potential catalyst for the industry, with significant implications for the advancement of high-level autonomous driving technologies [4][50].

Core Insights - The high-level autonomous driving industry remains highly competitive as it approaches the critical year of 2026, with various players vying for dominance in the market [1][6] - A third-party report has sparked debate over who leads in autonomous driving, creating a narrative that challenges the perception of Huawei's dominance and offers opportunities for mid-tier manufacturers [2][5] Market Dynamics - The report's focus on vehicle deployment numbers does not accurately reflect the true competitive landscape of the autonomous driving market, as many vehicles only feature nominal capabilities [3][7] - The industry is undergoing significant restructuring, with a consensus that only 2-3 leading players will survive, emphasizing the importance of integrated hardware and software capabilities [3][4] Key Players - The current market is heavily reliant on NVIDIA for core chip capabilities, while Huawei and Horizon Robotics are positioned as the main competitors in the domestic market [4][13] - In the autonomous driving chip market, NVIDIA holds over 60% market share, with Huawei and Horizon Robotics following at 16% and 15% respectively [13] Technological Trends - The introduction of Tesla's Full Self-Driving (FSD) technology in China is expected to raise the competitive bar, shifting the focus from rule-based to data-driven approaches in autonomous driving [9][10] - Tesla's advancements in end-to-end technology highlight the need for deep integration of hardware and software, which poses challenges for traditional software-only suppliers [10][11] Consumer Expectations - The essence of autonomous driving lies in its functional value rather than emotional appeal, with user trust becoming a critical factor in adoption [16][22] - As the market matures, the competition will shift from merely selling features to delivering reliable and trustworthy user experiences [22]

Investment Highlights - The main contradiction in C-end automotive intelligence has shifted from coverage to experience optimization in 2026. Major intelligent driving manufacturers and solution providers have achieved urban NOA (Navigation on Autopilot) experiences in complex scenarios such as roundabouts and U-turns, and have improved advanced functions like parking and ETC passage. The primary optimization direction moving forward will be the handling capability of Corner Cases to enhance the driving experience for passengers and safety operators [2][7]. Road Testing Overview - This report conducted both large-sample concentrated road tests and small-sample in-depth road tests. It qualitatively and quantitatively evaluated the intelligent driving experiences of six manufacturers/solution providers: Horizon, Li Auto, Qianli Zhijia, Qingzhou Zhihang, WeRide, and Xpeng, based on dimensions such as scenario implementation, takeover frequency, and comfort. Due to subjective scales, actual road conditions, and the trust level of safety operators in intelligent driving, the report does not rank the intelligent capabilities of specific manufacturers/solution providers [3][7]. Performance Improvement - Compared to 2025, all major manufacturers have improved their intelligent driving capabilities in Q1 2026, while third-party suppliers have also demonstrated excellent implementation results. The self-research camp of manufacturers is expected to continue iterating. Li Auto and Xpeng have developed mature self-research solutions that cover full-scene NOA on public roads and some internal roads, showing improvements in static and dynamic lateral perception, scenario understanding, and Corner Case handling. Li Auto's OTA 8.2 iteration has made AD Max smoother, reducing driving jolts and stabilizing responses. Xpeng's XOS 5.8.5 version can achieve three-point U-turns and autonomously learn from parking to parking, with VLA 2.0 expected to launch after the Spring Festival, enhancing reasoning efficiency and response speed [4][7]. Third-Party Supplier Performance - Third-party intelligent driving suppliers have shown impressive results. Their solutions have been launched to cover all external public roads seamlessly, with roundabouts and U-turns executed without interruptions. Horizon's HSD demonstrated smooth performance, achieving a full hour of deep road testing with zero takeovers (with one intervention for acceleration). Qianli Zhijia's G-ASD solution on the Zeekr model significantly reduced takeover rates. Qingzhou Zhihang utilized a single J6M chip (with 128 TOPS computing power) to achieve mass production of urban NOA, which is the lowest computing power among urban NOA models. WeRide's solution won the championship at the China Intelligent Driving Competition in Taizhou, showcasing excellent lane selection logic with no safety takeovers [4][7].

Core Viewpoint - Horizon has announced a strategic partnership with CATL's subsidiary, Times Intelligent, which signifies a significant collaboration in the automotive technology sector, particularly in smart driving and battery systems [1][12]. Group 1: Strategic Partnership - The partnership involves Times Intelligent providing its Rock Solid chassis products and technology, which enhances battery integration efficiency and allows for concurrent development with vehicle body and smart driving modules [13]. - Horizon will contribute its full-scene assisted driving products and solutions, including the recently launched Horizon HSD, marking a significant step in automotive intelligence [13][14]. - This collaboration is expected to help both companies reduce costs and improve competitiveness in the industry [14]. Group 2: Leadership Changes - Zhu Wei has been appointed as the new president of Horizon, previously serving as the executive president at CATL, indicating a strategic shift towards commercialization [3][19]. - The former president, Chen Liming, will transition to the role of vice chairman, focusing on major strategic decisions and governance improvements [3][19]. - Zhu Wei's extensive experience in sales and partnerships within the electric vehicle sector is anticipated to accelerate Horizon's market penetration and enhance its operational capabilities [16][19]. Group 3: Market Position and Challenges - Horizon has achieved a market share of approximately 46% in the ADAS market as of the first half of 2025, becoming the first domestic brand to exceed a cumulative shipment of 10 million smart driving chips [22]. - Despite this success, Horizon faces challenges such as increasing competition, price wars, and dependency on major clients, with 71.8% of its revenue in 2024 coming from its top five clients [28][29]. - The company is also under pressure to innovate and reduce costs, as competitors are rapidly advancing in technology and pricing strategies [24][31]. Group 4: Future Outlook - Horizon aims to expand its presence in the international market, leveraging Zhu Wei's experience to navigate competitive landscapes against global giants like Qualcomm and NVIDIA [18][31]. - The company has set ambitious goals for the next few years, including a target of producing 10 million HSD units and significantly enhancing smart driving capabilities in urban environments [34]. - To achieve these objectives, Horizon will need to invest in research and development, streamline costs, and accelerate the commercialization of its products [34].

Investment Rating - The industry investment rating is "Overweight," indicating an expected outperformance of the industry index relative to the benchmark by more than 5% over the next six months [71]. Core Insights - The main contradiction in C-end automotive intelligence has shifted from coverage to experience optimization, with major intelligent driving manufacturers achieving urban NOA experiences in complex scenarios such as roundabouts and U-turns, and enhancing advanced features like parking and ETC passage. Future optimization will focus on handling corner cases to improve the driving experience for passengers and safety personnel [2][66]. - Compared to 2025, all major manufacturers have improved their intelligent driving capabilities in Q1 2026, with third-party suppliers also showing excellent implementation results [2][66]. - The report evaluates the intelligent driving experiences of six manufacturers, including Horizon, Ideal, Qianli Zhijia, Lightyear, WeRide, and Xiaopeng, through both large-sample and small-sample road tests, focusing on scene implementation, takeover frequency, and comfort [2][66]. Summary by Sections Road Test Overview - The report includes two types of road tests: large-sample centralized road tests and small-sample deep road tests, each with distinct advantages and limitations [6][7]. - The large-sample test involved over 30 participants and standardized routes, while the small-sample test used consistent evaluators and longer durations for a more in-depth experience [7][8]. Intelligent Driving Models Tested - The models tested in February 2026 included: - Xingtou ET5 - Ideal i6 - Geely 9X - Ideal L6 Pro - Xingtou Star Era ES - Xiaopeng X9 [8][10]. Performance Metrics - Key performance metrics evaluated include overall evaluation, takeover frequency, stability performance, and efficiency in various driving scenarios such as roundabouts and U-turns [23][41]. - The report provides detailed performance scores for each model, indicating their ability to handle complex driving situations and overall driving smoothness [41][46][50][56][61][62]. Manufacturer Insights - Horizon's HSD achieved an average score of 4.55 with a total takeover frequency of 0.16, demonstrating excellent handling of road test scenarios [41]. - Ideal's AD Max scored 3.51 with an average takeover frequency of 1.86, showcasing strong performance in stability and handling [46]. - Qianli's G-ASD scored 3.05 with a takeover frequency of 2.60, indicating good performance in complex scenarios [50]. - Lightyear's AD Pro scored 2.89 with a takeover frequency of 2.75, performing well in roundabout scenarios [56]. - WeRide's E2E scored 3.84 with a low takeover frequency of 0.70, indicating strong performance in efficiency [61]. - Xiaopeng's XNGP scored 3.64 with a takeover frequency of 1.20, showing good stability and efficiency [62].

Core Viewpoint - The article discusses the significant advancements in the autonomous driving industry in 2025, focusing on the evolution of L2, L3, and L4 levels of autonomous driving technology, highlighting both the opportunities and challenges faced by the industry [3][11]. Group 1: L2 Level Developments - In 2025, L3 autonomous driving technology began to gain regulatory approval, leading to a decline in the previously popular "L2++" concept, with all consumer-facing smart driving functions now categorized as L2 [6][8]. - BYD initiated the "smart driving equality" movement by integrating its self-developed "Tian Shen Zhi Yan" system into lower-priced models, making advanced features accessible to more consumers [8]. - Traditional automakers like Geely and Chery followed suit, expanding mid-level assisted driving features to a broader market, contributing to a wave of widespread smart driving adoption [8][10]. - The market saw an increase in domestic smart driving suppliers like Momenta expanding into overseas markets, securing contracts with established automakers [8][10]. Group 2: L3 Level Developments - The end of 2025 marked a turning point for L3 autonomous driving, with the Ministry of Industry and Information Technology granting approval for the first L3 conditional autonomous driving models, including the BAIC Arcfox Alpha S and Changan Deep Blue SL03 [12][14]. - These models can operate under specific conditions, with the Arcfox capable of speeds up to 80 km/h on designated roads, marking a significant shift in responsibility from drivers to manufacturers and system suppliers [14][15]. - The approval of L3 technology is expected to reshape the industry landscape, potentially becoming a benchmark for measuring the leading players in the autonomous driving sector in 2026 [15]. Group 3: L4 Level Developments - 2025 was a pivotal year for L4 autonomous driving, witnessing a resurgence in capital investment and the beginning of commercial viability, with companies like Pony.ai and WeRide going public and raising significant funds [16][17]. - L4 technology demonstrated its commercial potential in specific applications, such as autonomous mining trucks and urban delivery vehicles, achieving operational efficiencies and cost reductions [19][23]. - The industry consensus shifted from a focus on technological idealism to practical commercial applications, emphasizing the importance of production capabilities and operational efficiency [23]. Group 4: Industry Insights and Future Outlook - The article emphasizes the need for continuous learning and adaptation within the autonomous driving sector, as technological advancements and market dynamics evolve rapidly [24][29]. - The growing application of autonomous driving technology across various urban and logistical scenarios in China reflects the country's leadership in the global autonomous driving landscape [29].

Core Insights - The article discusses the evolution of autonomous driving technology in 2025, marking a transition from research to practical implementation, with significant advancements in various technical areas [2][3]. Group 1: Industry Trends - The year 2025 is characterized as a turning point for autonomous driving, with technologies like BEV perception, multi-sensor fusion, and trajectory prediction reaching maturity [2]. - The competition in the smart electric vehicle sector is intensifying, with companies like Horizon, Xiaomi, and Li Auto making notable advancements [4][22]. Group 2: Company Highlights - Horizon has made significant strides with its HSD technology, showcasing high potential in end-to-end solutions and innovative approaches like GoalFlow and ResAD [9]. - Xiaomi's autonomous driving development has rapidly progressed, with a team exceeding 1000 members and a series of iterative improvements leading to the release of HAD enhanced version [10][11]. - Li Auto has established itself in the domestic autonomous driving tier, although it faces challenges in transitioning from range-extended to pure electric vehicles [13]. - Xiaopeng Motors experienced a rebound in sales, doubling its volume to nearly 430,000 units in 2025, driven by the successful launch of VLA 2.0 technology [14]. - Bosch is actively investing in both research and production lines, focusing on end-to-end solutions and enhancing its engineering capabilities [16]. Group 3: Future Outlook - The competition in the smart electric vehicle market is expected to become more fierce in 2026, with a shift towards L3 and L4 autonomous driving technologies gaining traction [22][23].

Core Viewpoint - Horizon Robotics aims to democratize urban assisted driving technology by making it available for vehicles priced at 100,000 yuan, targeting the mass market [3][8]. Group 1: Market Dynamics - In the first three quarters of this year, vehicles priced above 200,000 yuan accounted for 30% of the market share, while those below 130,000 yuan made up 50%, with the latter lacking urban assisted driving features [3]. - The competition in the intelligent driving sector is consolidating around a few leading companies, with Huawei and Momenta establishing strong positions in the high-end market [4]. - Horizon Robotics is rapidly expanding its market presence by introducing new algorithm service models and collaborating with various partners, including major automotive suppliers [6][10]. Group 2: Technological Developments - Horizon Robotics has transitioned from being solely a chip manufacturer to a full-stack solution provider, emphasizing the integration of hardware and software [6][10]. - The company plans to equip vehicles priced as low as 70,000 yuan with its urban assisted driving solutions next year, targeting a significant portion of the Chinese passenger car market [8][12]. - The introduction of the HSD Together model allows Horizon to collaborate with international partners, facilitating its entry into overseas markets [17][18]. Group 3: Competitive Landscape - The competition between Horizon Robotics and Momenta is intensifying, with both companies vying for market share in the L2+ segment and preparing for a direct confrontation in the lower-priced vehicle market [13][16]. - Momenta is also developing its own chips, which are expected to enhance its competitive edge in the intelligent driving space [14][15]. - The ongoing competition is characterized by a race to achieve higher performance at lower costs, with both companies focusing on production efficiency and ecosystem collaboration [15][19].

Core Viewpoint - The launch of the Chery Exeed ET5 marks a significant advancement in the competitive landscape of intelligent driving, introducing high-level autonomous driving capabilities to the mass market at an accessible price point [1][11]. Group 1: Product Launch and Features - The Exeed ET5 is the first mass-produced vehicle to feature Horizon's HSD and Journey 6P chips, promising an advanced driving experience with capabilities such as "superhuman response" and "human-like thinking" [1][10]. - The starting price of the Exeed ET5 is set at 144,900 yuan, with a potential subsidy bringing it down to 134,900 yuan, making high-level intelligent driving more accessible [1][11]. - The HSD system is praised as the "Chinese version of FSD," indicating its potential to reshape the intelligent driving industry [1][3]. Group 2: Technological Significance - The introduction of HSD signifies that Chinese automakers now possess a scalable top-tier intelligent driving foundation, crucial for the industry's transformation [2][15]. - The Journey 6P chip boasts a computing power of 560 TOPS, making it one of the most powerful domestic chips available, enhancing the performance of the HSD system [6][16]. - HSD's architecture incorporates reinforcement learning, enabling it to autonomously handle complex driving scenarios, thus pushing the boundaries of intelligent driving beyond mere imitation of human drivers [10][18]. Group 3: Market Impact and Competition - The Exeed ET5's launch is seen as a pivotal moment, as it brings high-level intelligent driving features, previously exclusive to luxury vehicles, into the 150,000 yuan market segment, which is the largest in China [11][12]. - The penetration rate of vehicles equipped with combined driving assistance systems in China reached 62.6% from January to July this year, indicating a growing consumer demand for intelligent driving features [11]. - The competitive landscape is intensifying with Tesla's FSD entering the Chinese market, prompting domestic brands to accelerate their intelligent driving offerings to maintain market share [12][15]. Group 4: Future Prospects - Horizon aims to achieve a production target of 10 million units for the HSD system over the next 3-5 years, further promoting the era of intelligent driving for the masses [14][18]. - The collaboration between Horizon and multiple automakers indicates a collective effort to enhance the intelligent driving capabilities across the industry, positioning HSD as a critical tool for Chinese car manufacturers to compete against global players like Tesla [15][18].