The Transformation of China’s Industrial Landscape

"At an auto show for the first time, I’ve seen so many foreigners," commented Fang Haoming, a correspondent based in China for China-Arab TV, while standing at Chery’s booth during the 2026 Beijing International Automotive Exhibition. As he looked around at the diverse crowd speaking multiple languages, his astonishment was evident.

Fang’s observation holds true. According to a Chery executive who spoke with China Newsweek, over 3,000 overseas guests of various ethnic backgrounds visited Chery’s booth on the exhibition’s opening day alone. Their interest extended beyond the vehicles; the Mojia robot on display also garnered significant attention and numerous photos from the international audience.

The 2026 Beijing International Automotive Exhibition Chery Automobile Press Conference Scene

(Image source: Chery Automobile)

This scene vividly illustrates the shift in China’s automotive industry status. There was a time when Chinese automakers were like “pilgrims” at the Frankfurt and Munich auto shows, looking up to overseas brands’ new technologies with a learning mindset. Today, the industry has undergone a significant transformation, with the wave of electrification and intelligence propelling Chinese automobiles from followers to leaders in a remarkable evolution.

The 2026 Beijing Auto Show epitomizes this reversal of the industrial landscape. With record-breaking super-large exhibition halls, a thousand vehicles on display, and over a hundred global premieres, a large number of overseas dealers and multinational media flocked to the event...

The “iPhone moment” for Chinese automobiles may no longer be a distant prediction or speculation but an industry reality that is currently unfolding.

Intelligence: From Concept to Widespread Accessibility

If China’s automobiles have gained initial international recognition on a large scale by surpassing Japan with the world’s largest export volume, then intelligence is becoming the crucial factor for China’s automotive industry to solidify its international standing and truly transition from large to strong.

At this year’s Beijing Auto Show, several automakers announced their commercial timelines and latest progress for L3 autonomous driving functions.

Huawei officially unveiled its Qiankun ADS 4.0 system at the auto show, claiming to have achieved seamless intelligent driving capabilities from parking spot to parking spot. XPENG Motors announced that its XNGP 5.0 system will introduce flagship models equipped with L3 hardware by the end of 2026.

KargoBot Press Conference Scene (Photography/Liu Shanshan)

KargoBot unveiled its core strategy for the next decade of L4 freight, KargoBot Inside. This is the world’s first full-stack empowerment strategy for “AI+Robot+Service” in mainline freight, marking the official transition of L4 autonomous freight from technological verification to comprehensive implementation. It will drive L4 freight into the “10,000-unit era” over the next three years.

More significantly, a large number of foreign brands have begun to proactively adapt and procure Chinese intelligent driving solutions. Once the exporters of technology, these foreign brands are now extending olive branches to Chinese companies: Volkswagen’s ID.ERA 9X and SAIC-Audi’s E7X both incorporate Momenta’s intelligent driving solutions; BMW’s Neue Klasse iX3 and i3 long-wheelbase versions jointly develop intelligent driving systems with Momenta; Mercedes-Benz’s pilot assist driving system for its domestically produced models is tailored specifically for China’s complex road environments.

The 2026 Beijing International Automotive Exhibition Momenta Booth

(Image source: Momenta)

Momenta CEO Cao Xudong told China Newsweek, "German BBA (BMW, Benz, Audi), Volkswagen, Japanese Toyota, Honda, Nissan, and American GM, Ford have all become our mass-production cooperation clients." This cooperation is not merely a simple supply chain adaptation but a comprehensive recognition of China’s intelligent technologies by foreign brands.

Foreign automakers are not only procuring Chinese technologies but also increasing their investments in local R&D in China. BMW has even established four R&D centers in China to strengthen local intelligent technology development. Gao Le, BMW Group’s board member responsible for customers, brands, and sales, told China Newsweek, "China’s digital ecosystem is irreplaceable; we must maintain strong competitiveness here."

"The new-generation BMW intelligent driving assist system, jointly developed with Momenta, will debut on the new-generation BMW iX3 long-wheelbase version, followed by the all-new BMW 7 Series, new-generation BMW i3 long-wheelbase version, and subsequent models sold in China," Gao Le said. "This system enables L2 intelligent driving assistance on both urban and highway roads, allowing driver intervention under specific conditions without system exit. This is our vision of intelligence."

In the view of Zhang Yongwei, Chairman of the Che Bai Hui Research Institute, convergent development has become the mainstream. Speaking at the Second Autonomous Driving Industry Development Forum, he said, "In the past, the automotive industry was not closely connected with the semiconductor and communication industries. However, in the era of autonomous driving, AI, semiconductors, communication, and the automotive industry are deeply integrated, breaking past industry boundaries."

He stated that the deep cooperation model between automakers and tech companies has achieved complementary strengths, accelerated technology implementation, and significantly reduced costs, making intelligence accessible from high-end models to the general public. "The overall cost of high-level autonomous driving has decreased by 40%-60% over the past two years. Intelligent driving systems that were once only available in high-end vehicles can now be equipped in models priced at around 100,000 yuan, greatly expanding the development space for intelligent driving," Zhang said.

Cao Xudong predicted that the scale effect and first-mover advantage in the intelligent driving industry are even stronger than those in the chip industry. The zero marginal cost of software means that more data leads to better experiences and lower costs. Moreover, the cooperation cycle with automakers is extremely long—three years for domestic automakers and 5-7 years for overseas automakers. He cited Momenta’s partnership with Mercedes-Benz, which began in 2017 and only achieved its first mass-production project by the end of 2025, spanning eight years. Therefore, the industry will rapidly converge, with "only 2-3 companies remaining in China and 3-4 globally, resulting in a highly concentrated landscape."

Intelligence Propels Chinese Automobiles Toward Global Markets

Technological breakthroughs in intelligence are transforming into the core competitiveness of Chinese automobiles in the global market. In the first quarter of 2026, Chinese automobile exports continued their rapid growth, becoming the biggest highlight of the automotive market.

According to the China Association of Automobile Manufacturers, China exported 2.226 million vehicles in the first quarter, a year-on-year increase of 56.7%. New energy vehicle exports reached 954,000 units, a year-on-year increase of 116.2%, accounting for 42.9% of total vehicle exports, up from 36.8% for the entire year of 2025.

The 2026 Beijing International Automotive Exhibition Scene (Photography/Liu Shanshan)

It is noteworthy that the globalization of Chinese automobiles is no longer simply about product exports but has formed a new paradigm of “R&D in China, global sales.” In 2025, Nissan and Dongfeng established an export joint venture company with the initial goal of promoting globally the new energy vehicle models developed in China.

Ivan Espinosa, CEO of Nissan Motor Company, told China Newsweek that the N7 will be exported to Latin America and Southeast Asia, while the pickup model Frontier Pro will be exported to Latin America, Southeast Asia, and the Middle East, with plans to subsequently export the NX8. "The core technologies, development speed, and cost advantages achieved through our ecosystem in China will also play a significant role in overseas markets," Ivan Espinosa said.

"Europeans are more focused on energy transition, presenting a significant opportunity for Chinese new energy vehicles," Lu Fang, Chairman and Party Secretary of VOYAH Automobile Technology Co., Ltd., told China Newsweek. "We adhere to a high-value route in overseas markets. As a state-owned enterprise, we should embody the image of Chinese manufacturing. We hope to establish our brand, enhance user experience and services, and gain the trust of more overseas users in Chinese brands and products."

In terms of intelligent driving, VOYAH has completed forward-looking layouts, accumulating 200,000 kilometers of actual road testing. In March of this year, VOYAH’s L3-level intelligent architecture was the first to achieve mass production. In the future, Kunpeng Intelligent Driving will evolve from integrated driving and parking to L3-level full-scenario assisted driving, while the Xiaoyao Cockpit will continuously iterate to create a "third space" that better understands users.

"Going global is not simply about product exports but a comprehensive output of technology, products, services, and brand value," Kang Bo, Vice President of Seres Group, proposed at the 2026 High-Level Forum on Intelligent Electric Vehicle Development. He outlined a three-stage development path for Chinese brands going international: the first stage is "going in" by establishing a business foundation through trade cooperation; the second stage is "going up" by promoting localized production and R&D; the third stage is "going out" by achieving global output of technical standards and brand value.

Behind this comprehensive output lies China’s unique advantage in the digital ecosystem. "China possesses a unique digital ecosystem, such as Alibaba and Tencent, which is difficult to replicate outside of China," Gao Le admitted. Young users in the Chinese market have a higher acceptance of digitization, which also compels overseas automakers to accelerate localized cooperation.

BMW’s cooperation model in the Chinese market is quite representative: BMW controls the underlying technology, while digital content is developed in collaboration with local partners. For example, AI voice interaction adopts technologies from Alibaba and Deepseek, the app store collaborates with Huawei, and it partners with ByteDance/Volcano Engine to create an AI-empowered customer experience journey. "This is a 'strong-strong alliance.' We adopt a similar logic overseas, but partners are adjusted according to regional markets," Gao Le said. For instance, in terms of voice, BMW will use Alexa+ globally, with the new version of Alexa first launching in English and German in the United States and Europe. "Ecosystem and technology partnerships are becoming increasingly regional rather than global," he added.

Of course, Chinese suppliers also face challenges of cultural and standard differences when cooperating with foreign automakers. According to Cao Xudong, the most common challenge is the conflict between China’s speed and the standards of international OEMs. "However, the core of this conflict revolves around customer and user value. As long as we co-create with a user-centric approach, we can often find better innovative solutions that yield results beyond expectations," Cao said.

Regarding the potential impact of Chinese technology going global, Cao Xudong proposed a solution of "reverse joint ventures." "Chinese technology is going global at a very fast pace," Cao said. When Chinese technology enters other markets, it not only brings more advanced product value to local users but may also impact local companies, employment, or taxation. "Reverse joint ventures allow local markets to enjoy Chinese technology and products while empowering local enterprises to achieve win-win outcomes," Cao explained.

In Zhang Yongwei’s view, the significance of autonomous driving extends far beyond the automotive industry itself; it will significantly drive the collaborative development of multiple fields such as artificial intelligence and electronic communications. He emphasized that the global competition in autonomous driving is twofold: "It is both a technological competition and a competition in regulatory standards. Only by excelling in both areas can we ensure the industry’s sustained leadership."