Just how 'smart' are electric cars? Regulators say a lot less than all the hype

When Kevin Gao, who has been driving in Shanghai for 17 years, was viewing new electric cars in a showroom, he was flabbergasted by what a salesman claimed.

"He told me that there is zero need for drivers to take over, and 'the car can drive itself and you can even take a nap'," he said. "I could tell they were trying to fool me."

Indeed, China's skyrocketing market for electric cars is facing something of a reality check as the government adopts new safety standards for car doors and automakers tone down their hype for self-driving technology.

Xiaomi, Li Auto, NIO, XPeng and other big electric car companies in China are changing the language they use to describe driver-assisted features amid public concern that promotions may have instilled a false sense of security among motorists. Instead of using words like "smart driving," they are now saying "assisted driving."

Xiaomi, which has borne the brunt of criticism after several accidents involving its cars, now calls the system used on its SU7 model "Xiaomi Assisted Driving Pro" instead of "Xiaomi Smart Driving Pro." Li Auto also recently talked about an "assisted-driving upgrade" for one of its cars, not a "smart driving" one.

These changes come after the Chinese government told car companies to come clean with wording. The government wants companies to explain what new technologies can and can't do. They also will require companies not to use terms like "self-driving" or "super smart driving" so people don't get the wrong idea about taking their hands off the wheel.

The most recent public clamor about electric-car safety came after on March 29 when three university students were killed after their Xiaomi SU7 electric vehicle crashed in Anhui Province. Preliminary reports indicate the vehicle was operating under its "Navigation on Autopilot" system at 116 kilometers per hour before the driver tried to intervene. The vehicle collided with a construction zone barrier at 97 kilometers an hour.

Initial social media concerns centered on a door-locking mechanism that prevented a hasty exit and on the fire resistance of lithium-ion batteries.

Xiaomi said it has addressed the concerns, though questions persist about the limitations of automatic emergency-braking systems and the overall reliability of advanced driver-assistance technology.

According to the company's official Weibo account, Xiaomi Auto delivered 28,000 vehicles in April, a 3.4 percent drop from the previous month. It was the first decline since the SU7 was launched.

Hong Kong-listed shares of Xiaomi Group (stock ticker: 1810.HK) dropped 5.5 percent in the first two days of trading this week to HK$48.60 (US$6.23), but clawed back some of those losses on Wednesday and Thursday.

"The past month is the most difficult time for me since I founded Xiaomi," Lei Jun, founder and chief executive of the company, told the public on his Weibo account. "I was quite depressed and canceled a few meetings and business trips. Your support allowed me to regain my confidence and courage."

For the past decade, China's new-energy vehicle industry has witnessed remarkable growth, with production last year increasing 34 percent to 12.8 million units and sales surging 35.5 percent. A decade of market dominance has been significantly shaped by the integration of smart-driving technologies.

Data from the first half of 2024 showed that the market penetration of vehicles equipped with Level 2 and above autonomous driving capabilities reached about 55 percent. It is forecast to approach 65 percent by the end of this year.

Level-2, or L2, means that smart driving acts like an advanced co-pilot: The car can steer and control speed, but the driver must always pay attention and be ready to take over full control.

Before toning down the promotion of Level 2 capabilities, many automakers were over-publicizing how "smart" their systems were, giving a false impression that drivers could let the cars take full control on the road.

Shanghai driver Gao said he complained to authorities about the car dealership showing him advertisements of drivers eating and even sleeping while behind the wheel.

"What if other people less experienced than me believed that?" he said. "It's irresponsible, and even driving L3 cars wouldn't allow such behavior."

The Level 3, or L3, smart driving Gao referred to is the next-level of autonomous driving, which allows a car to drive itself in specific situations, like slow highway traffic. The driver can temporarily look away, but the car will issue a warning to take back full control when needed.

China has not legally approved the application of L3 smart driving systems, so even if such a system is installed, its use violates the law.

"It is good that the companies are toning down their promotions because safety should always come first," Gao said.

Design of often hidden door handles on smart cars has come under particular scrutiny. China last week proposed the first global, mandatory safety standards for car door handles, targeting hidden and electrical designs that may make rapid exit difficult.

A draft document from the Ministry of Industry and Information Technology outlines safety, durability and emergency-exit requirements.

In April last year in Shanxi Province, a fatal crash occurred when a Huawei Aito M7 Plus vehicle rear-ended a road maintenance truck at high speed, caught fire and resulted in three deaths.

The investigation concluded that the collision prevented the door-handle mechanism from receiving the "pop-out" signal. Rescuers were forced to break windows and manually activate the interior mechanical handles, but it was too late to save lives.

In 2022, a similar accident occurred with a Lexus LM in the Guangxi Zhuang Autonomous Region, where rescuers had to break a window to reach the occupants.

Such accidents are not confined to China. In 2019, a Tesla Model S crash in the US had emergency responders struggling to open doors due to hidden handles, leading to a fatal fire. The result was a lawsuit against Tesla where concealed door handles were legally cited for the first time as a contributing factor in passenger deaths.

"To enhance vehicle safety for rescue and escape, we are strengthening exterior door handle safety in crashes and fires by requiring mechanical or power-loss backups." the ministry said in its statement on new mandatory standards. "This ensures that doors can open even without power or after impact. We're also preventing accidental opening in rollovers to reduce ejection risks and ensuring interior handle markings are clearly visible for swift emergency exits."

Setbacks aside, electric cars and automated technology are irreversible trends.

The International Energy Agency, in a report this week, said sales of electric vehicles globally in the first quarter rose 35 percent and will comprise 40 percent of the market by 2030. It cited the increasing affordability of the cars amid growing competition and declining battery prices.

The agency said China maintains its position as market leader, with electric cars accounting for half of 2024 vehicle sales.

Agency Executive Director Fatih Birol said, "Despite significant uncertainties, electric cars remain on a strong growth trajectory globally. Sales continue to set new records. This year, we expect more than one in four cars sold worldwide to be electric."

In China, Wan Gang, chairman of the China Association for Science and Technology, told a recent forum of vehicle companies that the march toward fully autonomous driving is accelerating, fueled by the increasing maturity of technology, innovation, and mechanism safeguards.

"There needs to be a revision of current traffic-safety laws and regulations to expedite the large-scale deployment of smart-driving vehicles on public roads," he said.