China’s Ban on “Smart Driving” Terms in Car Ads

China is implementing a ban on terms such as “smart driving” and “autonomous driving” in vehicle advertisements. This move is part of a broader regulatory effort to enhance oversight on advanced driver assistance systems (ADAS) and their over-the-air (OTA) updates.

Reasons Behind the Restriction

This decision was confirmed during a meeting held this week by the Ministry of Industry and Information Technology (MIIT) with nearly 60 representatives from the automotive industry. The action comes in response to increased safety concerns following a fatal accident in March involving Xiaomi’s SU7 sedan. Preliminary findings indicate that the vehicle crashed into a roadside pole at 97 km/h shortly after the driver switched back from the car’s ADAS, sparking widespread public discourse regarding the safety of such technologies.

New Requirements for Automakers

According to a transcript from the meeting reviewed by Reuters, automakers must now obtain government approval prior to implementing remote updates that modify driving-related features in vehicles that have already been sold. Additionally, these updates are to be preceded by stringent testing to ensure their safety and reliability.

Official Statements and Industry Response

In an official statement, MIIT clarified new rules that were published in February concerning OTA upgrades for intelligent and connected vehicles. Notably, Huawei, a supplier of ADAS to brands like Audi in China, was present at the closed-door session.

Impact on Advertising Strategies

The newly imposed advertising restrictions may significantly disrupt marketing strategies for car manufacturers. Chinese automakers have been actively promoting vehicles with ADAS features, frequently marketing them as possessing “smart driving” capabilities to gain a competitive advantage in a challenging market. For example, BYD sparked a pricing competition earlier this year by introducing over 20 models priced below $10,000, which include complimentary driver-assistance features, leading competitors such as Leapmotor and Toyota to adopt similar approaches.

Context of Rapid EV Adoption

This crackdown occurs concurrently with China’s swift embrace of electric vehicles (EVs). By late 2024, EVs and plug-in hybrids accounted for over 50% of total vehicle sales, surpassing government targets ahead of schedule. However, this rapid expansion has heightened regulatory concerns over safety issues, particularly in relation to EV battery fires and the potential for overcapacity within the industry.