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China’s Auto Market Tilts to Local EVs as AI Expansion Hits Supply and Labor Snags

Subsidies and lower-priced, feature-rich models are pulling consumers toward Chinese EVs.

Overview

  • Chinese-brand passenger cars captured nearly 70% of sales in the first 11 months, while Mercedes’ China sales fell 27% in Q3 and BMW/MINI declined 11.2% year to date, with dealers citing steep drops in used luxury prices.
  • BYD said its 15 millionth new‑energy vehicle is about to roll off the line and confirmed the Dolphin has surpassed 1 million units, with the Ocean sales network reaching 2.03 million vehicles in January–November.
  • Assisted driving usage is surging, with Huawei reporting 5.8 billion kilometers of cumulative ADS mileage and over 95% monthly active use, and BYD’s Tianshen Zhi Yan fleet exceeding 2.3 million vehicles that generate more than 150 million kilometers of data per day.
  • China’s AI core industry is projected by the China Information and Communication Research Institute to top 1.2 trillion yuan in 2025, alongside a new standard for coordinated training and inference services and a 23.1% rise in online sales of AI wearables in the first 10 months.
  • Oracle has reportedly delayed some OpenAI “Stargate” data centers from 2027 to 2028 due to skilled‑labor and materials shortages despite plans for 2 million accelerators and 5 GW capacity, and testimony from Kenya describes workers paid $0.05 per message to impersonate chatbots for an Australian firm.