Article | Leveraged Game by Yinyin Zhang Editor | Xinxin Ran China’s smart driving is moving forward on two legs: supporting research on intelligent and automated driving on the enterprise side, while promoting the integration of vehicle-road-cloud infrastructure, aiming to commercialize and scale automatic driving in various scenarios. After much speculation and competition, on July 3, 2024, the Ministry of Industry and Information Technology, Ministry of Public Security, Ministry of Natural Resources, Ministry of Housing and Urban-Rural Development, and Ministry of Transport jointly released a notice announcing the list of 20 cities designated as pilot cities for the application of “vehicle-road-cloud integration.” Smart driving has been a hot topic in recent years. Today, Leveraged Game will discuss who the winners are when our country issues policies and documents. Today, Leveraged Game will reveal the winners: out of over 30 cities that applied, these 20 cities emerged victorious.
Winners can be summarized in three aspects: specific cities and provinces, certain types of companies, and other beneficiaries. The cities included in the pilot application are Beijing, Shanghai, Chongqing, Ordos, Shenyang, Changchun, Nanjing, Suzhou, Wuxi, Hangzhou-Tongxiang-Deqing consortium, Hefei, Fuzhou, Jinan, Wuhan, Shiyan, Changsha, Guangzhou, Shenzhen, Haikou-Sanya-Qionghai consortium, and Chengdu. Intelligent driving demand is highest in large cities, which is why most cities on the list are large. Directly governed cities have a high status in China, with large urban areas, strong economic foundations, and a large number of vehicles. It is regrettable that Tianjin is not on the pilot list. Among the 20 pilot cities, 16 provinces and autonomous regions are involved. Apart from the three directly governed cities of Beijing, Shanghai, and Chongqing, Jiangsu Province is a major player in the pilot, with Nanjing, Suzhou, and Wuxi being selected.
3) Hubei and Guangdong are strong, each with 2 cities selected for the pilot program: Wuhan, Shiyan, Guangzhou, Shenzhen. Shiyan, where Dongfeng Group originated, has a good foundation, so its selection is not surprising. It’s also not surprising that Guangzhou and Shenzhen were chosen. If other cities in Guangdong were selected, it wouldn’t be surprising either. Jiangsu has 3 cities selected for the first batch of the pilot program, but due to limited spots, Guangdong had to make do. 4) Ordos in Inner Mongolia is a winner in the pilot program, although it is relatively smaller in size compared to other cities mentioned. Efforts in this region have been seen in the leverage game before. 5) In addition, Zhejiang and Hainan were selected in the form of joint efforts: Hangzhou-Tongxiang-Deqing and Haikou-Sanya-Qionghai. Congratulations to these cities outside the provincial capitals. Speaking of the leverage game, I have a friend from Hengyang in Hunan. Hengyang has been exploring in this area in recent years, but unfortunately, they have not been as lucky as Xiangyang. They also have not been able to enter the pilot program in a joint effort. Hopefully, Hengyang will be recommended by Hunan in the second batch of the pilot program. According to media reports, the application for the “car-road cloud integration” pilot program had over 30 cities apply, but only 20 were selected. These selected cities not only met the six application criteria but also conducted unique scenario applications based on their own characteristics. In early 2024, several departments jointly released a notice on the pilot work of “car-road cloud integration” for intelligent connected vehicles. Within less than 6 months, more than 30 cities worked together with five departments to complete the application, review, and expert evaluation of the pilot program, taking a crucial step forward in the development of “car-road cloud integration.” The Alliance for the Coordinated Development of Intelligent Vehicles and Smart Cities believes that this demonstrates China’s determination and efficiency in promoting the development of intelligent connected vehicles, highlighting the importance and urgency of such development. In April, the Ministry of Finance and the Ministry of Transport issued a notice supporting and guiding the digital transformation and upgrading of road and waterway transportation infrastructure. Starting in 2024, over a period of about three years, support will be provided to around 30 demonstration areas to create a batch of integrated demonstration corridors and networks, aiming to achieve digital transformation and upgrading of approximately 85% of busy national highways, 25% of busy ordinary national roads, and 70% of important national higher-level waterways, and provide a certain proportion of subsidies to declared projects. Therefore, the pilot projects will definitely expand, and it is profitable to be selected for the pilot projects with subsidies. In May, the Ministry of Finance released arrangements for the issuance of the fourth round of ultra-long-term special national bonds, with the integration of vehicle-road-cloud listed as a supported project, allowing local governments to directly apply for funds from the central government. At the same time, it was also mentioned in this pilot project that entities found to have safety hazards or have not implemented the pilot work as required will be suspended, urging the pilot cities to rectify and eliminate safety hazards in a timely manner. Entities with serious safety hazards, or those who do not rectify safety hazards in a timely manner, will have their pilot qualifications terminated. Which enterprises will be the winners? According to the China Society of Automotive Engineers’ prediction, by 2025, the output value of the intelligent connected vehicle industry will exceed 700 billion yuan, reaching 2.6 trillion yuan in 2030. In mid-June, following Beijing, Fuzhou, and Ordos, the “vehicle-road-cloud integration” project made progress in Wuhan with a record amount of approximately 17.1 billion yuan. The project, approved by the Wuhan Development and Reform Commission, is led by a local state-owned enterprise, Wuhan CheWang ZhiLian Testing and Operation Management Co., Ltd., with a total investment of 17.084 billion yuan. At the end of May, the investment amount indicated in the bidding announcement for the new infrastructure construction project of vehicle-road-cloud integration in Beijing was 9.39 billion yuan, with 70% of the investment coming from the government and 30% self-funded by state-owned enterprises. Simple examples, we can imagine how amazing the investment in the new infrastructure pilot project in the above 20 cities will be. As mentioned above, the first winner will definitely be the local state-owned enterprise responsible for this in the 20 cities. Related car companies, operators, and technology companies will also benefit. Suppliers, such as planning consulting, construction, and software and hardware equipment supply companies, will also benefit. Who else will benefit from this besides local governments and companies? 1) In addition to the 20 cities that have entered the pilot, according to Gong Weijie, Deputy Secretary-General of the China Society of Automotive Engineers and Secretary-General of the China Intelligent Connected Vehicle Industry Innovation Alliance, positive results have been achieved in the road testing of intelligent connected vehicles in China. By the end of May 2024, a total of 17 national-level testing demonstration areas, 7 car networking pilot areas, 16 smart test cities, over 32,000 kilometers of open test roads, more than 7700 test demonstration licenses issued, and over 120 million kilometers of test mileage have been established nationwide. With more than 8000 facilities for the construction of vehicle-infrastructure coordination, the promotion of early-stage testing and demonstration work has led to the rapid technological evolution of both high-level autonomous driving and “vehicle-road-cloud integration,” even entering a critical period towards large-scale application. However, the construction of “vehicle-road-cloud integration” in various regions is still in the early stages, unable to establish a complete system architecture, with fragmented infrastructure construction making it difficult to support the large-scale application of autonomous driving technology and networked functions. The pilot application of intelligent connected vehicle “vehicle-road-cloud integration” will fully leverage the construction foundation of early test areas, car networking pilot areas, “smart test” pilot areas, and other pilot work to promote the landing and large-scale application of intelligent connected vehicle “vehicle-road-cloud integration” technology. In other words, in addition to the aforementioned 20 cities, there are actually other places, many more places that have already benefited or will benefit. 2) Consumers, users, car companies, and others will benefit in the future. Currently, vehicle-infrastructure coordination still faces some issues, such as the need to further reduce costs after scaling up production and application, and the application scenarios and business models of vehicle-infrastructure coordination still need further exploration, especially in how to provide services to more intelligent connected vehicles and improve the public’s perception of technology. It is believed that one day, more drivers, passengers, and car companies will receive more convenient, efficient, smooth, and intelligent transportation services. 3) This pilot project will definitely help improve our transportation efficiency and enable various commercial applications in multiple scenarios. It requires creating a unified platform base, combining their respective development characteristics, and building a cloud service platform that can support a variety of applications. One of the purposes of the pilot project is to support the improvement of standard systems and the development of related standards, aiming to establish a unified and shared standard system for intelligent connected vehicles by 2026.
Relevant departments say: In response to the needs of smart cities, intelligent transportation, and industrial development, we will carry out pilot projects in various scenarios such as smart public transportation, smart passenger vehicles, automatic parking, urban logistics, and automated delivery, to continuously meet the growing demand for mobile travel and vehicle operations in different commercial scenarios, comprehensively improve urban traffic safety and travel efficiency. Ultimately, through the large-scale deployment of standardized networked cloud control infrastructure, we will meet the consistency and continuity requirements of intelligent networked vehicles for cross-regional services, comprehensively drive up the assembly rate and usage effectiveness of in-vehicle networked terminals, laying the foundation for nationwide large-scale application promotion. Lastly, we must mention the issue of life safety, information security, and personal privacy in this leveraged game. The relevant departments also mentioned this time, hoping to achieve this to the greatest extent possible.