With just a few taps on your fingers, you can book an autonomous taxi through your smartphone. As technology advances and policies support, this scene is moving from science fiction narratives into the lives of ordinary people.
Following the nationwide opening of manned test operation services for "Radish Run," on August 1st, Guangzhou made a significant announcement, intending to support the application of intelligent connected vehicles in transportation hubs such as highways, airports, ports, and in travel service scenarios like urban public transport and taxis.
As autonomous vehicles start to "run" in multiple locations, the "unicorn" in the domestic autonomous driving field is eager to enter the capital market. On July 31st, the intelligent driving chip manufacturer Black Sesame Intelligence announced that the company is expected to be listed on the main board of the Hong Kong Stock Exchange on August 8th, racing to be the "first stock of autonomous driving AI chips."
In addition to Black Sesame Intelligence, since the first half of 2024, several autonomous driving suppliers, including Horizon Robotics, Zongmu Technology, and Youjia Innovation, have rushed to the Hong Kong stock market. Not only supply chain companies are vying for positions, but also ride-hailing platforms like Cao Cao and Ruqi, which are going public in Hong Kong, also plan to use some of the raised funds to enhance autonomous driving.
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In fact, the interweaving of policies, technology, and capital has pressed the "accelerate button" for the commercialization of autonomous driving. According to a research report by Minsheng Securities, the industrialization of Robotaxi (autonomous taxi) has begun, and the industry has ushered in three major turning points in technology, demand, and progress; Huaxi Securities believes that with the continuous improvement of policies, industry, and technology, as well as the acceleration of the commercialization process, China's autonomous driving industry is expected to lead a new round of global technological innovation and development in the next 2-3 years.
The Hong Kong stock market may welcome the "first stock of autonomous driving AI chips."
Founded in July 2016, Black Sesame Intelligence is a supplier of automotive-grade computing SoC and intelligent automotive solutions based on SoC. Since its establishment, it has been deeply involved in the high computing power chip market, with main products including autonomous driving SoC and autonomous driving software and hardware supporting L2 to L3 level automotive automation.
During the historical record period, Black Sesame Intelligence's revenue mainly includes two parts: autonomous driving products and solutions, and intelligent imaging solutions. From 2021 to 2023, the revenue from autonomous driving products and solutions accounted for 56.6%, 86.0%, and 88.5% of Black Sesame Intelligence's total revenue, respectively, showing a year-on-year growth trend.
According to Frost & Sullivan data, in 2023, Black Sesame Intelligence's market share in the shipment of high computing power intelligent driving SoC in China (calculated in units) was 7.2%, ranking third, with the top two being NVIDIA and Horizon Robotics.
Generally speaking, SoC, known as "System on Chip," usually refers to a microchip that integrates multiple chip functions such as CPU, GPU, DSP, etc., into a single silicon chip. With the continuous improvement of the level of automotive intelligence, SoC has become an important track for major AI chip manufacturers to compete for, with advantages such as improved computing power, increased data transmission efficiency, and reduced chip usage.As one of the pioneers in the "blue ocean" of automotive-grade chip industry, Black Sesame Technologies has gained the favor of many star capitals since its establishment. Before this IPO, the company has completed 10 rounds of financing, with a total amount of $695 million, and its shareholders include Xiaomi, Geely, NIO Capital, Tencent, SAIC Group, BOC Investment, etc.
According to the announcement, Black Sesame Technologies plans to issue 37 million shares globally, with a guidance range of HKD 28 to HKD 30.3 per share, and the joint sponsors are Huatai International and CICC. Assuming the issue price is HKD 29.15 per share (i.e., the median of the issue price range), the company is expected to receive a net amount of about HKD 985 million from the global offering.
Black Sesame Technologies stated in the announcement that about 80% of the funds raised from this Hong Kong IPO will be used to build a research and development team for intelligent automotive-grade SoC, develop and upgrade intelligent automotive software platforms, purchase materials and software services for the research and development of intelligent automotive SoC and automotive-grade IP cores, and develop autonomous driving solutions.
From the perspective of market prospects, with the rise of the intelligent automotive wave, the market for autonomous driving SoC is accelerating expansion and upgrading.
A research report by China Galaxy Securities pointed out that the market demand for high computing power automotive-grade SoC chips will continue to grow, and it is expected that by 2026, the market size of automotive AI chips will grow from $1 billion in 2019 to $12 billion, with a compound annual growth rate of over 35%.
Frost & Sullivan predicts that by 2028, the global automotive-grade SoC chip market will exceed 200 billion yuan. Among them, intelligent driving will be a rapidly growing sector, and the penetration rate of intelligent driving in global passenger cars will reach 94.4%, and China will reach 97.2%.
Unmanned driving "turns red," and investment and financing heat rises.
No road rage, no detours, no fatigue driving... Recently, as Baidu's autonomous driving travel service platform "Luobo Fast Run" has appeared in several cities, the topic of unmanned driving has continuously sparked hot discussions among netizens.
In fact, unmanned driving is not a new thing. As early as 2005, Google X Lab had already launched the Google Driverless Car Project, which started road testing in 2009. The project became a subsidiary of Alphabet Inc., Waymo, in 2016.
As the "weathervane" of the global autonomous driving field, Waymo launched a Robotaxi service with a safety attendant in 2017. At the same time, the entrepreneurial trend of the autonomous driving track also swept through. Almost at the same time, domestic autonomous driving companies such as WeRide, Pony.ai, and WeRide were established one after another, and they looked at the commercial operation of L4-level (highly automated level) unmanned driving.However, due to the mutual constraints of various factors such as technology, cost, and data security, the commercialization of autonomous driving quickly encountered bottlenecks, and some companies engaged in autonomous driving have chosen to reduce their research and development and investment from Level 4 to Level 2.
Google once revealed that Waymo's annual operating cost is about 1 billion US dollars. The financial data of Black Sesame Technologies show that from 2021 to 2023, the company's revenue was 60.5 million yuan, 165 million yuan, and 312 million yuan respectively; the annual losses were 2.357 billion yuan, 2.754 billion yuan, and 4.855 billion yuan respectively.
"The company has not been profitable since its establishment, and this situation may continue in the future," said WeRide, which is preparing to go public on the NASDAQ, in its prospectus.
In the discussion of the commercial issue of profitability, Xiao Jianxiong, the founder of autonomous driving technology company AutoX, once made a metaphor in an interview, "Asking an autonomous driving company 'whether it makes money or not' is like asking 'whether a primary school student makes money or not', which may force him to work in a fast-food restaurant."
However, with the arrival of the AI era, computing power has made a qualitative leap, and autonomous driving technology is continuously optimized, accelerating the commercialization process of autonomous driving. Recently, the significant progress made by "Luobo Kuai Run" in Wuhan and Tesla's possible release of autonomous driving taxis (Robotaxi) this year have once again aroused the market's attention to the commercialization of autonomous driving.
The reaction of the capital market can best reflect the ups and downs of the track. According to incomplete statistics, since the second half of last year, intelligent driving "unicorns" have collectively rushed to go public, involving fields such as overall solutions for autonomous driving, lidar, and simulation testing.
For example, in December 2023, Zhixing Technology, an autonomous driving solution provider, went public on the Hong Kong stock market, raising a total of about 656 million Hong Kong dollars; on January 5 this year, Suzhou Xuteng Technology won the title of "the first stock of Hong Kong's lidar industry" and raised about 877 million Hong Kong dollars on the main board of the Hong Kong Stock Exchange.
In addition, companies such as Pony.ai and WeRide, which have independent research and development of autonomous driving vehicles and provide Robotaxi services, are accelerating their "drive" towards the US stock market; companies mainly providing intelligent driving solutions, such as Youjia Technology and Zongmu Technology, and companies focusing on intelligent driving chips, such as Horizon Robotics, are "clustering" to rush towards the Hong Kong stock market within the year.
Betting on autonomous driving has also become a new trend for domestic ride-hailing platforms. On April 29, Cao Cao Travel submitted a listing application to the Hong Kong Stock Exchange, stating in its prospectus that part of the funds raised would be used to invest in autonomous driving. On July 10, Ruqi Travel, which went public on the Hong Kong Stock Exchange, plans to use 40% of the funds raised for the operation and research and development of autonomous driving and Robotaxi (autonomous driving taxis).
In terms of investment and financing in the primary market, the field of autonomous driving is also very active.According to data from IT Orange, as of August 6th, there have been a total of 72 financing events in the intelligent driving (automatic/assisted driving) field this year, with financing amounts exceeding 15 billion yuan. In addition to the autonomous driving technology research and development companies receiving more financing, high-quality enterprises in the autonomous driving supply chain such as intelligent cockpits, LiDAR, and line-controlled chassis have also been favored by capital.
In terms of financing scale, in May of this year, the British artificial intelligence company Wayve announced the completion of a $1.05 billion Series C financing round, led by SoftBank Group, with NVIDIA and Microsoft following. This investment has set a new record for the largest single financing in the UK AI industry and will be used to support Wayve's comprehensive development and launch of the first embodied intelligent autonomous driving software for mass-produced vehicles, including the basic L2+ advanced intelligent driving system, as well as a software system that fully realizes autonomous driving.
There are also many domestic companies that have received large amounts of financing. On June 19th, the intelligent chassis system solution provider Li Ke Technology announced the completion of a 1 billion yuan Series C financing round, with investors including Hangzhou Fuchun Bay New City Development Fund, Sai Ze Capital, etc., and the company's latest valuation is 8 billion yuan; on July 14th, the automotive-grade chip design company Xin Chi Technology announced that it had obtained a 1 billion yuan strategic investment, with the latest valuation being about 13 billion yuan.
Recently, Weidu Technology, which focuses on new energy autonomous heavy trucks, completed a pre-IPO round of financing of 200 million US dollars. This round of financing was led by the Belgian Sovereign Wealth Fund, the Belgian Federal Holding and Investment Company, and the latest valuation has reached 6.5 billion yuan.
In addition, the valuations of companies such as Furuitai (13 billion yuan), Haowu Zhixing (11 billion yuan), and Xidi Zhijia (10 billion yuan) also exceed 10 billion yuan.
Policy benefits are gathering, and unmanned driving may usher in a "qualitative change" moment.
In addition to technological progress and the initial appearance of commercialization, this time unmanned driving has once again stood on the "wind mouth," which is also inseparable from the driving at the policy level.
On June 21st, Xin Guobin, the deputy minister of the Ministry of Industry and Information Technology, said at a press conference that the access and road traffic pilot of intelligent connected vehicles will be launched, and a city-level "vehicle-road-cloud integration" demonstration application will be organized to support conditional autonomous driving. "What is mentioned here is the commercial application of L3-level and higher-level autonomous driving functions." He said that this work has already started, and many places are actively responding.
On July 3rd, the Ministry of Industry and Information Technology and other five departments released the list of pilot cities for the "vehicle-road-cloud integration" application of intelligent connected vehicles, including Beijing, Shanghai, Chongqing, Jinan, Wuhan, Guangzhou, Shenzhen, Chengdu, and other 20 cities (joint groups) selected for the list.
"Vehicle-road-cloud integration" refers to the integration of the physical space and information space of people, vehicles, roads, and clouds through new generation information and communication technology, to achieve the safety, energy conservation, comfort, and efficient operation of the intelligent connected vehicle traffic system. In simple terms, it is "smart cars + smart roads."Minsheng Securities pointed out in its research report that the "vehicle-road-cloud integration" development path for intelligent connected vehicles has become an industry consensus and is key to promoting the large-scale industrial application of intelligent connected vehicles in the next stage. Pacific Securities believes that since this year, the top-level design of "vehicle-road-cloud integration" has been promoted from the top down, policies and regulations have been intensively implemented, and the introduction of application pilots has been accelerated.
While the construction of "vehicle-road-cloud integration" infrastructure is accelerating, many places are also exploring legislation on autonomous driving, providing a legal basis for the "road" of intelligent connected vehicles.
In July, the Beijing Municipal Economic and Information Bureau sought public opinions on the "Beijing Autonomous Driving Vehicle Regulations (Draft for Comments)", intending to support the use of autonomous driving vehicles in urban public bus transportation, ride-hailing, car rental, and other urban travel services. The Jinan Municipal Bureau of Industry and Information Technology released a public notice on the "Proposed Opening of Intelligent Connected Vehicle Test Roads", intending to open some roads as test roads for intelligent connected vehicles (medium-sized bus autonomous driving tests and demonstration applications).
Recently, the official website of the Guangzhou Municipal People's Congress released the "Guangzhou Intelligent Connected Vehicle Innovation and Development Regulations (Draft Revision for Comments)", proposing to support the application of intelligent connected vehicles in transportation hub scenarios such as expressways, airports, ports, as well as urban public transport, taxis, and other travel service scenarios.
Cities including Beijing, Shanghai, and Wuhan have also successively granted road rights to unmanned vehicles and issued licenses. On July 13, the first unmanned bus in Jinan officially "hit the road"; at the 2024 World Artificial Intelligence Conference, Shanghai issued the first batch of demonstration application permits for unmanned intelligent connected vehicles, and four companies including Pony.ai received the "license" to realize the application of fully unmanned manned vehicles on some sections of Pudong in Shanghai.
In the industry's view, technological progress, policy support, and the improvement of laws and regulations are accelerating the development of the autonomous driving industry.
"In 2025, autonomous driving will usher in the ChatGPT moment." Chen Liming, President of Horizon Robotics, said so at the 2024 China Auto Forum.
Coincidentally, He Xiaopeng, Chairman of XPeng Motors, had previously stated, "Intelligent driving will undergo a qualitative change in 2025. Now it may even be advanced to this year, because technological progress is faster than I imagined." In his view, "With the emergence of end-to-end technology, we only need to invest tens of billions (yuan) in training costs, and we can greatly improve product performance within a year, which will greatly accelerate the popularization of autonomous driving technology in practical applications."
Guohai Securities pointed out that the current order performance of Roborun is eye-catching, and with the accelerated iteration of autonomous driving technology, as well as the frequent introduction of policies to promote the commercialization of unmanned driving vehicles in various places, it is expected to drive the unmanned driving industry to truly enter the era of commercialization.