As the demand for intelligent vehicles grows in China, Chinese car chip makers are emerging as winners in the country’s automotive market, according to industry experts. Just two years ago, there was a shortage of auto chips in China, but since then, Chinese carmakers have increased their in-house chip production while third-party suppliers such as Horizon Robotics and Black Sesame have also entered the market. Despite US sanctions making it difficult for China to produce advanced chips used in smartphones and laptops, the country now has a vast army of chip producers capable of producing mature node chips for use in cars. As of 2022, Guangdong province alone had 8,900 registered car chip makers.
According to a report by Askci Consulting Co., China’s car chip output is expected to reach US$17.2 billion in 2023, a 55% increase from its output in 2018. Horizon Robotics, founded in 2015, has partnered with BYD to produce the Chinese carmaker’s proprietary BEV (Bird’s Eye View) perception solution, powered by Horizon Robotics’ Journey 5 computing processor, which is set for mass production this year.
Black Sesame, which designs system-on-a-chip (SoC) for auto-driving assistance, is working with Baidu on its car systems. Baidu has partnered with Black Sesame to integrate its intelligent driving solutions with Black Sesame’s chips to create an integrated system to be released later this year. Meanwhile, Nanjing SemiDrive Technology, founded in 2018 in eastern Jiangsu province, has appointed semiconductor veteran Cheng Taiyi as its CEO and secured a strategic partnership with carmaker Unity China on a smart car cockpit.
According to Xiang Weili, an executive director with Frost & Sullivan Greater China, chips related to autonomous driving and intelligent cockpits are developing rapidly as the development of intelligent vehicles continues. “Domestic and foreign market giants are flocking to the sector… the lack of chips in car companies has triggered a business explosion for many domestic chip companies,” said Xiang.
Although geopolitical tensions remain a risk, more companies are testing the possibility of using domestic chips, according to one industry car supply chain expert. The price is also a key factor for domestic intelligent carmakers, as the cost is the main challenge for many companies. In the microcontroller units (MCU) field, global giants such as Renesas Electronics and NXP Semiconductors remain leaders, so domestic car chip makers have focused more on artificial intelligence (AI) and SoC solutions.
“At this stage, AI chips used for car decision-making and control have data, computing power, and algorithms as the three major elements,” said Xiang Weili. “Since AI algorithms need to exchange large amounts of data with memory, this and bandwidth are currently important factors restricting the utilization rate of computing power, which will be a key focus for manufacturers looking for breakthroughs.”