Kaiyuan Securities released a research report stating that braking systems can be categorized into control, energy supply, transmission, and braking components, with upgrades based on the electrification of these structural parts. Brake-by-wire systems are divided into EHB (Electro-Hydraulic Brake) and EMB (Electro-Mechanical Brake) based on whether the power transmission relies on hydraulic systems. By 2025, benefiting from regulatory easing, EMB's domestic mass production and overseas expansion may face no obstacles. Batch releases of EMB-equipped models are expected by the end of this year or early next year.

In terms of market size and competition, the domestic braking market is projected to reach RMB 50 billion by 2030, with EMB accounting for RMB 16.4 billion. Including overseas markets and Robotaxi, the market could expand further. Domestic manufacturers are keeping pace with global giants like Bosch in mass production timelines, potentially achieving a competitive balance.

Key insights from Kaiyuan Securities include: - The decoupling of human-machine interaction in brake-by-wire chassis is fundamental for achieving L3/L4 autonomy. By 2030, the domestic brake-by-wire chassis market could exceed RMB 100 billion, with brake-by-wire and steer-by-wire (SBW) systems—given their high barriers, narrowing gap between domestic and foreign players, and low penetration—offering significant opportunities for local suppliers. - The main regulatory milestone in 2024 is the completion of draft standards for brake-by-wire and steer-by-wire, paving the way for EMB and SBW mass production by 2026.

Both EMB and SBW enhance driving experience and autonomous safety, potentially replicating the trajectory of LiDAR—becoming essential safety components beyond high-level autonomous vehicles. Their role in improving AEB and parking features may also serve as key selling points for automakers, with adoption rates possibly exceeding market expectations.

**On Brake-by-Wire (EMB):** Regulations will permit EMB installation starting January 2026. EMB eliminates hydraulic reliance, offering advantages like faster response, lighter components, and precise wheel control, though challenges remain in redundancy, voltage, and thermal management.

**On Steer-by-Wire (SBW):** While detailed regulations are pending, policy catalysts are expected this year. SBW decouples steering wheels, enabling full algorithmic control and serving as a foundation for L4/L5 autonomy. NIO’s ET9 has already adopted SBW, with ZF set to supply Mercedes-Benz in Europe by 2026. SBW’s benefits—such as cabin space optimization and tighter turning radii—could drive consumer appeal.

**Market Projections:** - By 2030, the domestic steering market is estimated at RMB 50 billion, with SBW contributing RMB 21.5 billion. Robotaxi and overseas expansion could further boost this figure. - Domestic players like NEXTEER (01316) and ZHEJIANG SHIBAO (01057) may challenge Bosch and ZF’s dominance.

**Future Trends:** Next-gen smart chassis will integrate braking, propulsion, and steering via "corner modules," addressing issues like latency and nosedive in early autonomous vehicles.

**Recommended Stocks:** Leading Tier 1 suppliers and upstream motor/lead screw manufacturers, including NEXTEER (01316), ZHEJIANG SHIBAO (01057), Bethel (603596.SH), Tuopu Group (601689.SH), Wuzhou Xinchun (603667.SH), Beite Technology (603009.SH), Siling (301550.SZ), and Shuanglin (300100.SZ).

**Risks:** Potential delays in regulatory progress, intensified competition, lower-than-expected auto sales, and slower-than-anticipated technological maturity.