China’s Ban on Smart Driving Terms in Car Advertisements

China has enacted a prohibition on the usage of phrases such as “smart driving” and “autonomous driving” within car marketing campaigns. This move is part of a broad regulatory initiative aimed at enhancing supervision over advanced driver assistance systems (ADAS) and their over-the-air (OTA) updates.

Government Decision Prompted by Safety Concerns

The ban, as confirmed by a meeting this week conducted by the Ministry of Industry and Information Technology (MIIT) with nearly 60 representatives from the automotive sector, arises from escalating safety worries following a deadly accident in March involving Xiaomi’s SU7 sedan. Preliminary investigations indicated that the vehicle collided with a roadside pole at 97 km/h shortly after the driver took back control from the car’s ADAS, igniting public discourse on the safety of such technologies.

New Regulations for Remote Updates

According to a transcript from the meeting analysed by Reuters, car manufacturers will now be mandated to obtain governmental approval prior to implementing remote updates that modify driving-related functionalities in vehicles that have already been sold. Such updates will also need to undergo extensive testing to ensure their safety and dependability.

Clarification on OTA Upgrade Rules

In an official announcement, the MIIT stated that it had clarified the newly established rules introduced in February regarding OTA upgrades for intelligent and connected vehicles. The meeting was attended by representatives from Huawei, a supplier of ADAS to various brands, including Audi within China.

Impact on Marketing Strategies

The newly implemented advertising restrictions could significantly challenge marketing approaches for automotive companies. Chinese manufacturers have been vigorously advertising vehicles equipped with ADAS, frequently marketing them as having “smart driving” features to secure a competitive advantage in the market. For example, BYD has further intensified the price competition earlier this year by introducing over 20 models priced under $10,000 that include complimentary driver-assistance functionalities, leading competitors such as Leapmotor and Toyota to adopt similar strategies.

Regulatory Concerns Amidst Electric Vehicle Growth

The crackdown coincides with the rapid uptake of electric vehicles (EVs) in China. By late 2024, EVs and plug-in hybrids constituted more than 50% of total vehicle sales, surpassing government targets ahead of schedule. This swift expansion has heightened regulatory apprehensions regarding safety, particularly concerning EV battery incidents and surpluses in the industry.