Morgan Stanley: AI capabilities, not price, will drive China's EV market competition
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Summary
Morgan Stanley analysts predict that competition in China's EV market is shifting from price wars to AI capabilities, particularly autonomous driving technology. Carmakers are redirecting resources toward Level 3 (L3) autonomous driving upgrades as a way to manage weakening demand and tightened regulations. The shift could make conditionally autonomous driving the new norm, advancing from current L2/L2+ systems, as the industry looks beyond subsidy-driven sales for growth.
Key quotes
· 3 pulledThe push in AI would likely bring models with conditionally autonomous driving capability, or Level 3 (L3), to market.
It might even soon become the norm, advancing from the current L2 or L2+.
Carmakers redirect resources to autonomous driving upgrades, hoping AI can deliver growth beyond subsidy-driven sales.
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