By Yoko Kubota

SHANGHAI -- Beijing is slamming the brakes on China's self-driving marketing frenzy.

As Tesla and other automakers have touted their assisted-driving systems with terms such as "autonomous" and "self-driving," one deadly crash last month involving the technology has sparked a broad debate over its capabilities -- and how the features are being portrayed to the public.

Coming in for particular scrutiny by Beijing's regulators is the question of whether automakers are portraying the artificial intelligence-powered technologies accurately, as well as the related issue of whether the public fully understands how it should be employed.

It is a high-stakes moment for China's electric-vehicle industry, which has upended the global automotive world with a wave of affordable, sleekly designed cars. Chinese EVs have forced Western automakers to fight for survival in China, the world's largest automotive market, and increasingly to play defense in their own home markets. Washington has slapped sky-high tariffs on Chinese EVs to keep them out of the U.S., while China leads in car-battery technology.

On advanced driver-assistance technology, another key area of competition, China's rapid advances have raised alarm in the U.S. Beijing sees AI-powered driver-assistance systems as an area where China can lead the world, alongside other AI products such as chatbots and humanoid robots.

Chinese regulators aren't banning advanced driver-assistance technology. To the contrary, the technology is rapidly advancing and is likely to continue. In a crowded EV market with more than a hundred brands, Chinese carmakers have looked to driver-assistance technology as a way to distinguish their offerings from their rivals.

But last month's deadly crash, involving a car manufactured by Xiaomi, has served as a warning to officials that language used to describe the technology should be more carefully monitored.

After last month's accident, Chinese regulators called a meeting on smart connected vehicles, instructing roughly 60 carmakers and other industry players to "not engage in exaggerated and false publicity."

The current moment serves as a "wake-up call" for the industry, said Giovanni Lanfranchi, vice president of Chinese EV startup Zeekr. "We need to be super, super paranoid" when it comes to safety, he said at an event. Zeekr, which is a part of Chinese carmaker Geely Holding, offers a driver-assistance system that it calls G-Pilot.

Yale Zhang, managing director at Shanghai-based research firm Automotive Foresight, said that some carmakers have been telling "their stories a little bit too aggressively," leading to misunderstanding by some drivers of how the technology should be used.

"This policy probably will save the industry," he said. "If every car owner can be persuaded that this is just assisted driving -- it's not autonomous driving -- this will cause a lot fewer accidents."

Last week at Auto Shanghai, China's biggest auto show, the nervousness across the industry was palpable. Executives were careful to stick to terms like "driving assistance" or "support." Suppliers' product presentations emphasized safety. Carmakers' marketing staff scrambled to revise executive speeches ahead of the show, cutting out words like "autonomous" and other terms that they worried could be seen as too aggressive, said people familiar with the matter.

"Cars becoming more intelligent is definitely the trend of the future, but safety is the main thing when it comes to what we are developing," said He Xiaopeng, co-founder and chief executive of Chinese EV startup XPeng, last week. XPeng will get better at explaining new functions and delineating the capabilities of assisted-driving functions, he added.

At the moment, even the most advanced driving-assistance technologies in China still require drivers to pay attention while sitting behind the wheel and to be prepared to take over at any time -- what is known in the industry as "Level 2" of vehicle autonomy. China hasn't completed the regulatory framework for "Level 3," in which the car temporarily would take over driving. Industry experts say the shift from Level 2 to 3 would be a big leap.

In recent years, Tesla has been at the global frontier of promoting driver-assistance technologies in consumer vehicles, through its "Autopilot" and "Full Self-Driving (Supervised)," or FSD, systems.

Over the past year, Tesla has been awaiting regulatory approval to offer FSD. Earlier, Tesla rendered its "Autopilot" system into Chinese using a translation roughly equivalent to "Enhanced Autonomous Assistant Driving." FSD, meanwhile, it translated as something akin to "Full Self-Driving Ability."

Chinese EV makers and suppliers have followed in Tesla's footsteps and developed similar driving-assistance systems. The trend accelerated with the emergence of so-called "end-to-end technology" powered by AI, which replaced an approach that relied on preprogrammed rules that laid out a variety of situations that a car might encounter on the road.

Many Chinese carmakers, including XPeng, NIO and Xiaomi -- the latter of which was best known for making smartphones and rice cookers before leaping into the auto industry -- as well as leading Chinese auto suppliers such as Huawei Technologies and Momenta, have introduced technologies that aim to help drivers navigate complicated urban streets.

In China, where car buyers are relatively new to driving and generally tech-savvy, an openness to ceding vehicle controls to a computer have allowed for rapid adoption of self-driving technologies, according to a PricewaterhouseCoopers report from 2023.

Tesla's misstep, Xiaomi's crash

In February, Tesla started to offer some driving-assistance features in China such as city navigation through over-the-air updates. While these features are a part of Tesla's FSD system in the U.S., it was bundled under the Autopilot system in China.

Critically, Tesla didn't seek Chinese regulators' blessing before doing so -- an oversight that angered government officials, said people familiar with the matter. The move prompted China's Ministry of Industry and Information Technology, the auto industry's primary regulator, to release emergency guidance on driving assistance and over-the-air updates, the people said.

The guidance, which was published in February, made clear that carmakers are responsible for safety and securing regulatory approval before issuing over-the-air updates related to driving assistance technology.

In late March, Tesla changed the translated version of its product names. Autopilot was now "Enhanced Assistant Driving" and FSD was "Intelligent Assistant Driving," with earlier references to "self-driving" gone.

Tesla and the Ministry of Industry and Information Technology didn't respond to requests for comment.

Then, on March 29, came the accident involving Xiaomi's driver-assistance technology.

According to Xiaomi, right before the accident, the car had been driving along the highway in the eastern province of Anhui at about 72 miles an hour, with the driving-assistance system activated. The car neared a construction zone, with a section of the road cordoned off with roadblocks and vehicles diverted to the opposite lane.

At 10:44:24 p.m., the Xiaomi driving-assistance system detected an obstacle, issued a warning and started to slow down. One second later, a human driver took the wheel. Between the next one to three seconds, the car then crashed into a concrete guardrail, killing three people, Xiaomi said.

Lei Jun, Xiaomi's founder, expressed condolences and said Xiaomi has submitted the vehicle data to the police. Xiaomi said it would cooperate with investigations and declined to comment further.

Crashes involving driving-assistance technology have happened around the world. In an investigation last year, the U.S. National Highway Traffic Safety Administration tied at least 14 fatalities to Tesla's driving-assistance technology.

The Chinese-driving assistance technologies aren't available in the U.S., in line with a Biden administration-era ban on Chinese connected car-related technology.

Write to Yoko Kubota at yoko.kubota@wsj.com

(END) Dow Jones Newswires

April 29, 2025 05:30 ET (09:30 GMT)

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