China’s self-driving car push hits legal and cost roadblocks

China’s efforts to get more nearly autonomous vehicles on its roads have become bogged down by growing uncertainty over the technology’s near-term profit potential in a challenging environment.

The country has made significant strides in recent years under a national strategy that prioritizes autonomous-driving technology. A road map released in November 2020 calls for 20% of all new vehicles sold to have Level 4 capabilities — letting them operate without a driver under certain conditions — by 2030.

But analysts are starting to doubt this target will be met, with some seeing the figure as low as 3%, as regulatory issues and profit worries have chilled investment and pushed startups to seek other ways to bring in revenue.

Owen Chen at S&P Global Mobility, which predicts the share will reach only 7%, argues that China has not developed an adequate legal framework for Level 3 and higher technology, and that even if one is put in place, scaling up the business will take time.