Core Viewpoint - The competition in the intelligent driving chip market has shifted from algorithm functionality to core hardware chips, with significant developments from domestic chip manufacturers like Horizon and Momenta [3]. Group 1: Domestic Intelligent Driving Chips - Horizon's J6P chip has completed hardware design and is in performance testing, with plans to achieve vehicle readiness by Q2 2026, targeting mid-to-high-end models [5]. - Horizon plans to reduce the price of the J6P chip by approximately 15% by 2026, with potential discounts of up to 20% for major clients like BYD, impacting the mid-to-high-end chip market [5]. - Momenta's BMC chip has entered the testing phase, focusing on cost advantages and targeting the market for vehicles priced below 200,000 yuan, with expected mass production in 2026 [6][7]. - Momenta anticipates a significant increase in output, projecting around 1 million units in 2026, driven by partnerships with SAIC, GAC, and Chery [7]. Group 2: Algorithm and Performance Comparison - In standard driving scenarios, both Momenta and Horizon perform similarly, but Momenta excels in complex scenarios, benefiting from its extensive urban experience [8]. - Momenta's software-driven hardware model allows for better adaptation to market needs, enhancing user experience and providing tailored tools for automakers [8]. Group 3: Self-Development vs. Collaboration - Different automakers are adopting varied strategies, with companies like NIO and Li Auto focusing on self-developed chips, while others like Chery and Geely are opting for a mixed approach [9][12]. - High-end models are more likely to utilize self-developed chips to enhance profit margins and adapt to specific driving algorithms, while mid-to-low-end models prioritize cost-effectiveness [13]. Group 4: Market Dynamics and Future Outlook - The market is expected to see a coexistence of self-developed chips and third-party suppliers, with domestic chip market share projected to reach around 10% by 2026 [15]. - NVIDIA is expected to maintain a significant market share in high-end models, while domestic suppliers like Horizon and Momenta are anticipated to capture substantial portions of the mid-to-low-end market [15]. - The price trends indicate that while low-end chips are stabilizing, high-end chips from NVIDIA may see price increases, while domestic chips like those from Momenta are expected to drop significantly [21]. Group 5: Challenges and Opportunities for Domestic Chips - Domestic chips still face challenges in performance and algorithm ecosystem compared to NVIDIA, with a technology gap of about 1-1.5 generations [17]. - The Robotaxi sector presents an opportunity for domestic chips, although current limitations in performance and ecosystem integration hinder broader adoption [18][19]. Group 6: Price Trends and Market Projections - The pricing landscape for intelligent driving chips varies significantly based on performance, with low-end chips around 1,000 yuan and high-end chips from NVIDIA priced between 8,000-9,000 yuan [21]. - The competitive landscape in 2026 will be crucial, with domestic chips pushing for wider adoption and price reductions, enhancing the overall driving experience for consumers [22].

Core Insights - Qualcomm's historical performance in specific sectors often depends on external players, as seen in the smartphone era where companies like Samsung and Xiaomi propelled Snapdragon's dominance [1] - In the smart automotive sector, the decision-making power has shifted to numerous Chinese automotive participants, indicating a change in the ecosystem dynamics [2][8] Group 1: Qualcomm's Position in the Automotive Industry - Qualcomm hosted an "Automotive Technology and Cooperation Summit" in Suzhou, showcasing a comprehensive map of the Chinese smart automotive industry with key players from various segments [6][7] - Unlike the smartphone era where Qualcomm defined industry standards, in the smart driving era, Chinese partners have become the main drivers of the ecosystem, leading in the development of practical solutions [8] - The recent Snapdragon 8797 chip represents a shift from Qualcomm's previous product positioning, serving as a flexible "integrated central computing platform" rather than a purely smart driving chip [12] Group 2: Competitive Landscape and Market Dynamics - The Snapdragon 8797 chip boasts an estimated sparse equivalent computing power exceeding 700 TOPS, meeting the performance needs for both cockpit and smart driving applications [13] - Chinese partners are pushing for stronger AI performance, with some opting to use the more powerful 8797 chip for cockpit solutions instead of the newly released 8397 [14][15] - Xiaomi's approach is notably radical, integrating the consumer-grade Snapdragon 8 Gen 3 chip into the cockpit and deeply combining it with NVIDIA's Thor chip, highlighting a trend towards cross-brand chip integration [17][22] Group 3: Market Challenges and Opportunities - Qualcomm's product rollout speed is not industry-leading, with the Snapdragon 8797 expected to enter mass production in early 2026, lagging behind competitors [23] - Despite challenges in software support compared to NVIDIA, Qualcomm's partners can leverage their capabilities to fill gaps, allowing Qualcomm to focus on chip design and production [25] - The current market landscape shows that Qualcomm's mid-tier products, such as the 8620 and 8650, are gaining traction as mainstream options, driven by the cost-effectiveness of combining Qualcomm hardware with Chinese partners' software [26][28] Group 4: Innovation and Strategic Shifts - The intense competitive environment in China is fostering innovation, compelling all participants, including chip giants, to adopt more agile and market-responsive development models [34] - Major global players are increasingly focusing on the Chinese market, with strategies evolving to operate independently within China while developing competitive products for the global market [36] - The collaboration between companies like GAC Toyota and local partners such as Huawei and Xiaomi signifies a broader trend of integrating local resources to enhance competitiveness in the automotive sector [35]

Investment Rating - The report maintains a positive outlook on leading third-party intelligent driving suppliers, highlighting their potential to capture approximately 50% of the new car sales market share due to the demand for equal access to intelligent driving technology and performance improvements [2][3]. Core Insights - The report emphasizes the historical breakthrough opportunities for domestic intelligent driving chips, particularly focusing on the competitive landscape where domestic suppliers are catching up with NVIDIA in terms of product performance and mass production validation [2][30]. - The report discusses the importance of a combined hardware and software approach, noting that Horizon Robotics is currently one of the few suppliers capable of delivering both high-level intelligent driving chips and algorithms, positioning itself strongly within the industry [5][71]. Summary by Sections 1. Positive Outlook on Domestic Intelligent Driving Chips - The report identifies a significant opportunity for domestic intelligent driving chips, driven by the increasing demand for equal access to intelligent driving technology [7]. - It highlights that the competition among car manufacturers is intensifying, leading to a shift towards third-party intelligent driving solutions as a preferred option for second and third-tier car manufacturers [2][19]. 2. Analysis of Horizon Robotics - Horizon Robotics is entering a new cycle of product iteration and business model enhancement, leading the domestic chip suppliers in the rollout of high-level intelligent driving systems [5][81]. - The company’s unique soft-hard integration strategy allows it to optimize performance and cost, making it a key player in the intelligent driving supply chain [5][71]. 3. Competitive Landscape and Market Dynamics - The report notes that the intelligent driving market is expected to see a significant increase in penetration rates, with projections indicating that by 2026, urban NOA (Navigation on Autopilot) will become a standard feature [20][35]. - It discusses the evolving E/E architecture in the electric vehicle era, which provides a foundation for car manufacturers to expand their capabilities beyond traditional supply chain integration [12][16]. 4. Technological Advancements and Innovations - The report highlights the advancements in intelligent driving algorithms, particularly the shift towards a "heavy perception, light map" approach, which has been validated and widely adopted [2][54]. - It also emphasizes the role of reinforcement learning in enhancing intelligent driving models, providing new solutions to complex driving scenarios [56][62]. 5. Cost and Performance Considerations - The report provides insights into the cost structure of intelligent driving chips, indicating that achieving economies of scale and rapid iteration capabilities are crucial for car manufacturers considering in-house chip development [49][50]. - It compares the performance metrics of various intelligent driving solutions, showcasing the competitive positioning of domestic suppliers against established players like NVIDIA [32][33].