Auto Shanghai 2025, one of the major global automotive events on the calendar, is taking place from 23 April – 2 May 2025 and GlobalData are there to cut through the noise to bring you the real insight behind the biggest announcements.
John Zeng (Director of Asian Forecasting) and Lancy Zhang (Powertrain Market Analyst) have shared their thoughts on some of the show’s biggest talking points.
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Key Takeaways
Volkswagen Group’s Innovative Strategy
At this year’s auto exhibition, Volkswagen Group unveiled an innovative approach to enhancing their market position by augmenting traditional Internal Combustion Engine (ICE) vehicles with cutting-edge autonomous driving technology, establishing a unique technical trajectory.
Audi-Huawei Milestone
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By GlobalDataVW Group aims to demonstrate that next generation mobility is not limited to purely Electric Vehicles (EVs). The company has a substantial portfolio of conventional vehicles and has integrated the Huawei MDC810 computing platform in the Audi A5L, which boasts 400 TOPS of computing power, along with the Huawei Advanced Driving System (ADS) 3.0 system.
Shifting Consumer Preferences
Consumers are moving away from ICE vehicles not only due to the powertrain system, but because of their limited adoption of intelligent driving systems.
Insights
Latency Solutions
The response time of mechanical products is markedly slower than that of their electrical counterparts. VW Group’s products have shown that the company has successfully attained real-time control capabilities by integrating intelligent systems with traditional vehicles, despite the inherent slower mechanical response times.
Successful Integration
Huawei provides algorithms and computing platforms while Audi optimizes powertrains, combining German handling with Chinese smart driving technology. This collaboration model offers replicable solutions for legacy automakers.
Perception Change
The consumer perception of “smart cars” is typically associated with “EVs.” VW Group’s strategy may inspire a rethink. Its success or failure will significantly impact other automakers’ transition timelines.
Impact
Industry Restructuring
The industry structure will undergo a reshaping, particularly in the supply chain and in the competition for technology standards. Established automakers might collaborate on “smart ICE” standards to challenge Tesla’s EV-centric intelligent framework.
Competitive Differentiation
Before fully committing to Battery Electric Vehicles (BEVs), smart ICE vehicles could become a key selling point for non-Chinese brands, especially for those grappling with New Energy Vehicles (NEVs). Simultaneously, the new technology could maintain a higher resale value than traditional ICE vehicles.
Analyst View
Pioneering Experiments
According to our analysis of new products, which include intelligent configurations, to date only NEVs have been equipped with intelligent technology. VW Group is the first to implement intelligent technology in ICE vehicles. This new technology presents an alternative for legacy automakers, though how successful it will be is
yet to be determined.
Integration Challenges
Beyond market feedback, the new technology requires the dismantling of silos to achieve hardware-software synergy. This will be a testament to the automaker’s integration capabilities.
Policy-Market Balance
From an emissions target perspective, this new pathway could serve as a transitional technology before achieving a “zero emissions” goal. It has the potential to delay the phase-out of traditional ICE vehicles.
Conclusion
The Audi-Huawei collaboration demonstrates that autonomous leadership isn’t EV-exclusive. By combining high-performance computing (400TOPS Huawei platform) with optimized traditional powertrains, this approach offers legacy automakers a viable transition path. While challenges remain in cost and consumer adoption, it provides crucial flexibility during the industry’s electrification transition, particularly for premium brands where driving dynamics remain paramount. The tech-automaker partnership model may prove equally significant as the technical breakthrough itself.
John Zeng, Director of Asian Forecasting & Lancy Zhang, Powertrain Market Analyst, GlobalData
This article was first published on GlobalData’s dedicated research platform, the Automotive Intelligence Center.
