Electric Vehicles

Tesla has officially launched its Full Self-Driving (FSD) capabilities in China, a significant move after years of regulatory delays. This comes as Chinese EV brands rapidly advance their autonomous driving technologies. FSD (Supervised) is now available in China as one of 10 key markets. The rollout follows CEO Elon Musk’s recent visit to Beijing and intensifies competition with domestic players like Xiaomi and Xpeng. The “intelligent assisted driving” feature is offered for Model 3 at 64,000 yuan.

China’s fierce EV price war is fueling intense AI feature innovation. Automakers are integrating advanced AI, like ByteDance’s Doubao and Alibaba’s Qwen, into numerous models to differentiate in a saturated market. While AI enhances the in-car experience and consumer demand, features are rapidly commoditizing. Companies are shifting focus to the “outside-of-the-car experience” and holistic customer strategies to maintain competitiveness.

Alibaba’s Qwen AI model is being integrated into vehicles from major Chinese automakers like BYD and a Volkswagen joint venture, enhancing in-car digital services. This move aims to differentiate vehicles amidst slowing EV sales. Audi’s upcoming E7X SUV will also feature AI from ByteDance and iFlyTek, highlighting a trend toward AI-powered in-car experiences.

Tesla faces a critical juncture ahead of its Q1 earnings. While revenue is expected to grow, concerns about slowing deliveries and increased competition from rivals like BYD and Xiaomi persist. Investors are also scrutinizing the company’s future-oriented ventures in autonomous driving and robotics, as well as a slowdown in its energy storage division. Musk’s strategic moves, including the integration of xAI and SpaceX, add another layer of complexity to Tesla’s outlook.

Tesla’s China-made EV sales surged over 35% in early 2026, indicating a market rebound. Despite fierce competition from BYD and emerging domestic players, Tesla’s Shanghai Gigafactory remains a key production hub, supplying both domestic and export markets. While BYD leads overall, Tesla’s performance suggests sustained demand amid an intensifying competitive landscape and rapid innovation in the EV sector.

Xiaomi launched its new flagship Xiaomi 17 and 17 Ultra smartphones at Mobile World Congress. Despite an 80-90% surge in memory chip prices due to supply shortages, Xiaomi has maintained the launch prices of these premium devices. Industry analysts suggest this strategy could be challenging for Xiaomi, as its sales volume is heavily reliant on mid-range devices, unlike Apple and Samsung which can leverage higher-margin premium sales. Diversification into its electric vehicle business provides a crucial revenue stream.

Chinese automakers are rapidly advancing in EV technology, posing an existential threat to the U.S. auto industry. Legacy manufacturers like Stellantis, GM, and Ford are facing significant financial setbacks, scaling back EV ambitions, and incurring billions in losses. Even Tesla has been surpassed in EV sales by BYD and is pivoting towards robotics and AI. Chinese brands have seen dramatic global market share growth, forcing U.S. companies to voice concerns and seek protective measures like tariffs. While the U.S. shifts focus, China’s government support, integrated supply chains, and speed accelerate their global expansion.

Xiaomi announced a HK$2.5 billion share buyback program, aiming to boost investor confidence amidst market challenges and competition. Despite a temporary stock increase, the company faces headwinds from a memory chip shortage impacting smartphone margins, scrutiny over EV accidents, and pressure on vehicle profitability. Xiaomi is also investing significantly in its semiconductor division and global EV expansion.