According to Nikkei, Chinese automakers such as SAIC Motor, Changan, Great Wall Motor, BYD, Li Auto, and Geely are reportedly preparing to launch vehicles equipped entirely with domestically produced chips, with at least two brands targeting mass production as early as 2026.
The report, citing sources, notes that the latest policy goal is to achieve 100% domestically developed and manufactured automotive chips by 2027—an aggressive acceleration from this year’s earlier target of having 25% of domestic automakers adopt locally made chips. The 100% target is not mandatory but serves as a policy framework encouraging companies to align with Beijing’s broader strategic goals, Nikkei adds.
To support this ambitious goal, some automakers are reportedly already taking steps. According to sources cited by Nikkei, companies such as GAC Group are working closely with Chinese foundries like SMIC and CanSemi Technology to assess the entire automotive chip supply chain and help validate locally developed alternatives.
The report, citing sources, notes that China’s major automakers—including SAIC, FAW Group, GAC Group, BYD, Geely, Changan, and Great Wall—have been urged by the government to accelerate their adoption of domestically produced or developed chips.
Notably, Nikkei points out that most automotive chips can be manufactured using older-generation equipment, making it easier for China to ramp up domestic production.
Meanwhile, Chinese automakers remain reliant on U.S. and other foreign-made chips, particularly for autonomous driving systems. According to Nikkei, suppliers say clients have acknowledged that a rapid shift to fully domestic sourcing would be difficult. Amid this push, global chipmakers like STMicroelectronics, NXP, and Infineon are deepening ties with Chinese foundries to expand production for local automakers, the report states.
Chinese Carmakers Accelerate Chip Push
Chinese automakers—especially in the EV sector—are ramping up chip development. According to SeekingAlpha, citing Financial Times, EV maker XPeng is developing advanced processors for Volkswagen. The company has reportedly designed its own AI-focused Turing chips, which it claims outperform those made by U.S. giant NVIDIA and are intended to power the next generation of intelligent vehicles. SeekingAlpha notes that in July 2023, Volkswagen invested $700 million for a 4.99% stake in XPeng, forming a strategic alliance to co-develop EVs for the Chinese market.
