[News] Instead of Rely Solely on NVIDIA, China’s EV Makers Turn Focus to In-house Chips amid US-China Tensions

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The electric car market in China has been facing intense competition, with Xiaomi revealed that it suffered a USD 9200 loss per vehicle from April to June. However, the price war is not the only battleground, as the focus now seems to be turned to another front.

According to a report by CNBC, chip-powered tech features, such as the driver assist function, have gradually become the latest trend, while the development of in-house chips emerges as the possible match point for China’s EV makers. The reason behind: the need for customization and a must to reduce reliance on cutting-edge AI chips amid US- China tensions.

Until now, many leading Chinese EV manufacturers have relied on NVIDIA’s chips, with the AI heavyweight’s automotive chip business generating over USD 300 million in quarterly revenue in recent years, CNBC notes.

However, Chinese electric car start-ups Nio and Xpeng both announced progress on their self-developed chips lately, signaling the beginning of a new era in which in-house chips may become the mainstream for the industry.

In late July, Nio announced that it had taped-out its self-developed intelligent driving chip, Shenji NX9031, which is manufactured with 5nm node. The chip is said to be integrated into the company’s ET9 model, which is scheduled for delivery in 2025.

Citing industrial specialists, CNBC states that the move marks the first time that 5nm has been used in the Chinese automotive industry. For now, 3nm node is primarily utilized in smartphones, personal computers, and artificial intelligence-related applications.

On the other hand, another China’s EV start-up, XPeng Motors, announced in late August that its first AI chip, Turing, has been successfully taped-out. It is worth noting that XPeng has a strong relationship with NVIDIA, and Xpeng’s former head of autonomous driving joined Nvidia last year, CNBC reports.

In 2019, Tesla has reportedly moved away from using NVIDIA’s chips to developing its own, with a focus on advanced driver-assist functions. Citing an industrial specialist, CNBC suggests that Tesla and Chinese EV startups are expected to compete by designing their own chips, while traditional automakers will likely continue to depend on NVIDIA and Qualcomm for the foreseeable future.

The report does not anticipate a significant impact on NVIDIA in the short term, as Chinese automakers are expected to test new technology in small batches within the high-end segment of the market.

Anyhow, the reason behind the wave of self-developing chips for Chinese EV makers may be that it would be difficult for a company to differentiate itself if it uses the same silicon to power its infotainment and intelligent driving systems. By designing their own chips, Chinese automakers can customize features and mitigate supply chain risks associated with geopolitical tensions.

According to the report, U.S. restrictions on NVIDIA’s chip sales to China have not directly impacted automakers, as their vehicles have not yet required the most advanced semiconductor technology.

However, with a growing emphasis on driver-assist functions, which depends heavily on artificial intelligence—a key area in the U.S.-China tech rivalry—Chinese automakers are now turning to in-house technology.

Read more

• [News] China Reportedly Demands Automakers Increase Local Chip Procurement to 25%
• [News] Chinese EV Maker XPeng Tapes out Latest In-House Chip, Boasting Triple the Computing Power of its Rivals

(Photo credit: Nio)