Future Transport to China

Trends and opportunities

The market

Supportive government policy and high levels of investment in research and development are facilitating the rapid growth of China’s capabilities in the Future Transport sector.

The Chinese Government has established a timeline for the completion of several key strategic transport infrastructure projects:

  • 2020 - Complete the 13th Five Year Plan for transport and mass infrastructure construction (includes fast rail links, airports and highways)
  • 2030 - Upgrade the efficiency and quality of integrated transport
  • 2045 - Introduce on-demand travel, wide spread use of autonomous vehicles (AV) and integrated rail roads (full implementation of future transport technologies, including autonomous vehicles)

(MoT planning and MOT annual conference Jan 2018)

China is on track to complete construction and operate 150,000 km of highways and 150,000 km of railways, of which 30,000 km are high-speed train lines, by the year 2020 (Ministry of Transport 13th Five Year Plan overview).

Supporting China’s future transport goals is the ‘Made in China 2025’ policy initiative, which was highlighted within the 13th Five Year Plan and seeks to position China as a technology leader by 2025.

In October 2016, the Society of Automotive Engineers (SAE) in China released a detailed roadmap for the introduction of autonomous vehicles. The plan calls for self-driving cars to be permitted on highways within the next three to five years and on urban roads by 2025. Based on the release of this roadmap, the Ministry of Industry and Information Technology (MIIT) announced its own specific goals for intelligent connected vehicles (ICV) by the year 2025. These include:

  • Reducing traffic accidents by more than 30%
  • Setting safe autonomous driving speeds up to 120km/h
  • Lowering energy consumption by 10%, and reducing emissions by more than 20%.

(National ICV Industrial Standard Guideline)

Current Developments

The market for automated driving systems in China is likely to grow rapidly on the back of strong government regulatory support, high levels of R&D investment and the rapidly evolving nature of China’s vehicle market. Some analysts have predicted that China will be the largest and fastest growing market for future transport technology developments (Bloomberg article, 24 April 2018).

China has undertaken a number of steps to support the development of its domestic ICV and AV sector:

  • The National ICV Innovation Centre has been established to lead ICV development, under the guidance of MIIT. It will coordinate government, manufacturers and technology suppliers to develop a holistic eco-system for ICV development.
  • In January 2018, NDRC drafted a ‘Strategy for Intelligent Vehicle Development” which was open to the public for comment.
  • China has established seven national pilots for connected and self-driving cars in Shanghai, Beijing / Hebei and Changchun, Chongqing, Hangzhou, Wuhan and Wuxi. (Source: MIIT)

In March 2018 Shanghai issued the country’s first road-testing licences for autopilot vehicles on public roads and in doing so became the first city in China to migrate road tests of ICVs from enclosed areas to public roads. The licences issued will allow China’s largest automaker SAIC and Shanghai-based electric carmaker NIO to test their ICVs on a 5.6 km stretch of public road in Jiading District. Testing features on this stretch of road include vehicle identification capabilities, responses to speed limit information, traffic light identification, lane keeping and other safety-related functions. Prior to the release of these new licences, testing of ICVs was only permitted in enclosed areas such as the National Intelligent Connected Vehicle Shanghai Pilot Zone.

China’s Ministry of Industry and Information Technology (MIIT) has played a key role in the drafting of guidelines and policies for the industry, with Beijing’s Haidian and Yizhuang districts nominated as demonstration areas for ICVs. The Haidian testing centre covers an area of around 133,000 sqm. and has been developed with hundreds of different static and dynamic traffic scenarios that resemble China’s urban and rural road networks. The testing centre is also equipped with internet and communication facilities which can be utilised for further research and testing of connected vehicles. Enterprises such as BAIC, Baidu, Foton, HiRain Tech and Holomatic have already begun vehicle testing at the Haidian base. An additional facility in Yizhuang (as of November 2018) is nearing completion, and covers an area of 433,000 sqm. The facility is equipped with a series of scenarios that aim to cover 80% of urban road and 85% of highway traffic scenarios. The Yizhuang area has been positioned as a ‘future transport hub’ for Beijing. It is located not far from the city of Xiongan, which is being designed with the needs of future transport solutions in mind (link ).

In April 2018 and with government regulatory support, Chongqing became the third city to allow unmanned cars to complete public road testing. Seven car manufactures including Chang’an and Geely were successful in obtaining permits to undertake testing on 12.5 km section of road within the city centre.

Regulatory reform to allow for ICV and AV testing is becoming more widespread, as cities across China seek to position themselves to benefit from this fast-growing sector.

Opportunities

The Chinese market has placed strong emphasis on vehicle-to-vehicle and vehicle-to-infrastructure connectivity. The connected car ecosystem requires:

  • Intelligent road infrastructure, supported by sensors, mobile communication, traffic control equipment and energy pipelines along the road
  • Intelligent tools and systems: autonomous vehicles, supported management systems, shared vehicle systems
  • Open and shared management systems: requiring coordinated approach from different industries: electronic information; automotive; information & communication; Transportation and big data.

Although Australian capabilities are often not well understood in China, there are opportunities for Australian businesses with leading technologies, products and research and development capabilities to participate in China’s future transport market, in particular in:

  • Software and algorithm-based technologies and solutions
  • Big data collection and processing
  • Communication technology
  • Artificial intelligence

Competitive Environment

Chinese companies continue to make important developments and pioneer research into future transport technologies and have established diverse international partnerships across the supply chain.

  • Baidu announced a partnership with US Airbiquity to develop future transport technologies in January 2014 (link )
  • DiDi purchased an IP package from France Brevets and established an AI lab in Silicon Valley in March 2017 to develop driverless technology ( ink)
  • PSA collaborated with Alibaba to offer an app to check vehicle location and fuel levels remotely (link)
  • Audi (link) established a partnership with Alibaba, Baidu and Tencent to work on big data; e-commerce ecosystem; Internet Finance; Intelligent Connected Vehicles
  • SAIC (SAIC: link) established an AI Lab to focus on smart transport and intelligent manufacturing
  • BAIC Motor and Baidu signed ICV strategic cooperation (BAIC: link)

Many of China’s leading technology companies have invested significant resources into developing technologies for the ICV and autonomous vehicle sector.

Examples include:

In 2013 Baidu began researching autonomous technology and in 2015 established a driverless business unit. In January 2018 Baidu released the Apollo 2.0 platform that aims to provide a reliable and secure software platform for its partners to develop their own autonomous driving systems. It aims to attract OEMs, component suppliers and technology companies and works closely alongside Bosch and other companies that are well established in the industry. By 2018, the project had gathered support from over 100 global partners. Baidu has been undertaking open road testing since December 2015 and started the mass production of its L3 min-bus in July 2018 in partnership with Xiamen Kinglong Bus. It has also been testing L4 Apollo cars in Xiong’An New Area from May 2018. (WeChat: link )

Tencent has long-term interests in the sector, with minority equity investments in both NIO and Tesla (5%) (Reuters: link ) . Tencent and Foxconn have jointly established a Future Mobility Corp new energy vehicle company. In 2016, Tencent established an Autopilot Drive Lab at Shanghai International Auto City. Tencent has also collaborated with Guangzhou Auto Group and released the Ai in Car ecosystem in November 2017.

In December 2015 Alibaba established Banma technology in partnership with China’s largest Chinese OEM, SAIC Motor (SAIC), with the aim to provide comprehensive solutions for ICVs. The system developed through this partnership is called ‘AliOS’. Alibaba has also signed a strategic agreement with Ford, and also collaborates with Donfeng Citroen.

Links and industry contacts

State Council
Ministry of Industry and Information Technology (MIIT)
Ministry of Transport (MoT)
National Development and Reform Commission (NDRC)
Ministry of Science and Technology (MoST)  
Ministry of Public Security (MPS)
Standardization Administration of China (SAC)  
China Intelligent Transportation System Association (ITS China)
Society of Automotive Engineers of China     
China Industry Innovation Alliance for ICV www.caicv.org.cn
China Association of Automobile Manufacturers http://www.caam.org.cn/

Upcoming mission to China

Austrade is organising a trade mission to China in March 2019, with a focus on seeking opportunities to connect with developments in China’s connected and automated vehicle (CAV) market. A webinar will be held on 5 December 2018 for Australian businesses, researchers and transport departments to outline the mission. For further information, please contact Ross Cooper at the Austrade Sydney office or Sandy Dendy at the Austrade Shanghai office.

Contact details

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