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Sales of passenger vehicles (PVs) with Level 3 autonomy are expected to reach over 25,000 globally in 2024 with China, Europe and the US likely to see rollouts this year, according to Counterpoint Research’s latest Global Autonomous Passenger Vehicle Tracker and Forecast.

China will be the main driver regionally considering the size and advanced state of its domestic PV market. Mercedes, being the first company to introduce Level 3 autonomy globally, is the first mover in this space, even as Chinese OEMs rapidly approach. “The government has always been a big supporter of autonomous driving technology, resulting in a mature and nuanced Level 2 ADAS environment,” said Research Analyst Shaochen Wang. “With the recent consolidation in regulation for higher-level autonomous driving, there have been multiple Level 3 testing licenses issued across the region, which is facilitating the healthy participation of a broad range of players both large and small – from solutions providers like Huawei to smaller EV brands like IM Motors.”

Chinese OEMs’ autonomous driving strategies remain consumer-centric in contrast to Tesla’s which is focused on enabling its Cyber Cab service with an in-house and consumer-owned fleet. “There is no right or wrong way as things are driven by culture,” observed Senior Analyst Ivan Lam. “US owners are likely to look at their cars more as a commodity, whereas in China, cars are still viewed very much as a luxury.”

Chinese OEMs are also parting ways in terms of technology, opting to adopt hybrid solutions which include Lidar and other sensor types. “Tesla has a big advantage in terms of mileage, but excluding Lidar sets the bar higher and increases risks significantly, regardless of how much training data there is,” said Research Analyst Mohit Sharma. “Having a more robust system will give Chinese OEMs an edge, at least in terms of hardware.”

As OEMs and solution providers continue to evolve hardware systems and expand training data, we expect China to reach an installed base of over 1 million Level 3 ADAS-enabled PVs on the road by 2026 and a shipment share of 10% by 2028. Counterpoint Research