Market Competitiveness Analysis of Changan Automobile's L3 Autonomous Driving Commercial License

Based on comprehensive collected data and market information, we now provide you with a systematic and in-depth analysis report.

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On December 15, 2025, the Ministry of Industry and Information Technology officially announced China’s first batch of access permits for L3 conditional autonomous driving models, with Changan Deepal SL03 and Arcfox Alpha S6 becoming the first approved models [1][2]. On December 20, 2025, Changan Automobile obtained China’s first L3-specific license plate “Yu AD0001Z”, and BAIC Arcfox obtained “Jing AA0001Z” on December 23, marking the official transition of China’s L3 autonomous driving from the testing phase to commercial application [3].

According to the “Automotive Driving Automation Classification” standard, L3 “Conditional Autonomous Driving” means that under the operating conditions preset by the system, the vehicle can complete all dynamic driving tasks, and the driver needs to take over when requested by the system. The core significance of this access permit lies in

—previously, mass-produced vehicles in China were equipped with L2-level driver assistance systems, with the driver always being the responsible subject; the implementation of the L3 permit means that within the designated operational design domain, when the system is working normally, the main responsibility for driving is transferred from humans to machines for the first time [4].

Changan Automobile’s L3 autonomous driving layout shows a clear evolutionary path:

Time Node	Key Progress
June 2024	One of the first batch of L3 autonomous driving access pilot automakers (one of the 9 consortiums)
February 2025	Completed all product testing and safety evaluations
December 15, 2025	Approved in the first batch of access permits (Deepal SL03)
December 20, 2025	Obtained China’s first L3-specific license plate

In terms of technical verification, Changan’s L3 autonomous driving system has accumulated more than 5 million kilometers of real road testing in Chongqing’s complex road conditions (known as the “8D Magical City”), covering extreme scenarios such as overpass clusters, motorcycle traffic, and pedestrian jaywalking, laying a solid foundation for passing national-level safety evaluations [4].

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China’s automobile industry presented a “one superpower, multiple strong players” pattern in 2025:

Automaker	2025 NEV Sales	YoY Growth Rate	Penetration Rate	Market Position
BYD	4M+ units	Est. 40%+	Est. >60%	Absolute Leader
Geely	1.6878M units	90%	55.78%	Second Echelon
Changan Automobile	1.11M units	51.1%	38.1%	Third Echelon
SAIC	1.643M units	33.12%	36.45%	Second Echelon
Chery	1.344M units (exports)	17.4%	-	Export Leader

Changan Automobile ranks third among traditional automakers in new energy transformation, with a penetration rate of 38.1% lower than Geely and BYD, but it still maintains a steady growth momentum supported by a sales base of 1.11 million units and a YoY growth rate of 51.1% [5][6].

According to the latest financial data [0]:

Indicator	Value	Industry Comparison
Market Capitalization	$96.69B	Mainstream automaker level
P/E Ratio	17.04x	Moderate, lower than new forces
P/B Ratio	1.50x	Relatively reasonable
ROE	8.83%	Above-average
Net Profit Margin	4.15%	Better than most new forces
Current Ratio	1.22	Healthy liquidity

: According to the Q3 2025 financial report, earnings per share (EPS) was $0.08, a sharp 61.20% decline from analysts’ expectations of $0.20, indicating that profitability pressure still exists [0]. Free cash flow is negative (-$18.71M), showing that the company still faces capital turnover pressure during its expansion phase.

In the past 90 trading days, Changan Automobile’s stock price has fallen from $12.24 to $11.69, a decline of 4.49%, and is currently below the 50-day moving average ($11.91) and 200-day moving average. Technical analysis shows that the stock price is in a

, with a reference trading range of [$11.61, $11.86]. The MACD indicator is bearish, but the KDJ indicator has entered the oversold zone, presenting a short-term rebound opportunity [0].

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Changan Automobile’s L3 autonomous driving system has the following technical features:

: Covers perception redundancy, computing redundancy, braking redundancy, steering redundancy, power redundancy, communication redundancy, and positioning redundancy, ensuring safe operation even if a single sensor or actuator system hardware fails [7].

:

• First to be equipped with 4D radar micro-Doppler effect technology, improving general obstacle recognition capability
• Equipped with micro-collision sensors, optimizing adaptability to scenarios such as sudden pedestrian crossings and sudden deceleration of preceding vehicles
• Supports recognition of general obstacles in construction zones such as cartons and traffic cones
• Effectively responds to secondary collision scenarios

:

• Urban congestion scenario: Maximum speed of 50km/h, enabling autonomous driving in single lanes on expressways and urban express roads
• Expressway scenario: Maximum speed of 80km/h (Arcfox Alpha S6)

Automaker	Technical Route	Core Features
Changan Automobile	Self-developed Seven-Layer Redundancy	High safety redundancy, localized scenario adaptation
BAIC Arcfox	Huawei HI Mode	Huawei ADS high-level intelligent driving system
BYD	DiPilot Sky Eye	Standard across all product lines, cost advantage
Xpeng Motors	Full-stack Self-developed	End-to-end technology, XNGP system
Tesla	Vision-Only FSD	Dojo cloud training, algorithm leadership

From the perspective of technical routes, Changan adopts a

, with reliability as its core selling point; BYD pursues “Universal Intelligent Driving” cost equalization; and Xpeng focuses on extreme algorithm iteration [8][9].

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According to Southwest Securities’ calculation, the domestic L3 autonomous driving market scale is expected to exceed

by 2030, becoming another trillion-yuan track [7]. Frost & Sullivan predicts that global intelligent connected vehicle sales will reach 95.8 million units in 2029, with the Chinese market accounting for 22 million units, or 23.0% of global total sales [1].

:

Year	Market Scale (CNY 100M)	Growth Drivers
2025	85	Policy breakthrough, pilot operation
2026	210	Large-scale B-side operation, C-side function opening
2027	380	Technology maturity, cost reduction
2028	580	Scale effect emergence
2029	850	Regulation improvement, user acceptance enhancement
2030	1200	Mainstream configuration, market maturity

According to Changan Automobile engineer Chen Lei [7]:

1. Q1 2026
   : B-side pilot operation (Deepal SL03 in designated areas of Chongqing)
2. H2 2026
   : Gradually open functions to C-side users based on policy progress
3. Brand Expansion
   : Launch related products under brands such as Avatr, Changan Deepal, and Changan Qiyuan

Haitong International’s research report points out that

, and with the accumulation of pilot experience and gradual improvement of regulations, L3 autonomous driving functions are expected to expand from local demonstrations to broader access [1].

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As the first domestic automaker to obtain an L3 autonomous driving commercial license, Changan Automobile has received national-level technical recognition, which serves as a significant trust endorsement in consumers’ minds. Referring to the market reaction of BAIC BluePark’s Arcfox model’s stock price limit-up after obtaining the license [2], the capital market holds a positive attitude towards the L3 concept.

The seven-layer redundant architecture and more than 5 million kilometers of complex road test data have built a high technical safety threshold. Against the backdrop where “responsibility division” for L3 autonomous driving has become a core issue [2], Changan’s high-safety redundancy design aligns with regulatory trends and user expectations.

Changan plans to gradually introduce L3 functions to three major brands: Avatr (high-end), Deepal (young technology), and Qiyuan (mainstream), covering the mainstream price range of 200,000-400,000 yuan to form differentiated competition.

BYD has announced that its “DiPilot Sky Eye” intelligent driving system will cover 21 models across its entire product line, promoting “intelligent driving equalization” with cost advantages [9]. If L3 functions are quickly extended to models priced at 100,000-200,000 yuan, it will create price pressure on Changan.

Automakers using Huawei’s HI mode, such as BAIC Arcfox, AITO, and Avatr, may have faster iteration speeds for intelligent driving algorithms. Huawei’s all-round cooperation model from components to HI mode to smart selected vehicles [8] provides a shortcut for partner automakers to quickly improve product strength.

There are still ambiguities in responsibility determination for L3 autonomous driving, and the rule that “the driver needs to take over when requested by the system” requires users to maintain high attention. How to help users understand the system’s capability boundaries and respond to takeover requests in a timely manner is a user education challenge faced by Changan [2].

Dimension	Key Factors	Changan’s Current Status	Recommendations
Technology	Algorithm iteration, data closed-loop	Seven-layer redundancy, safe and reliable	Accelerate end-to-end algorithm R&D
Cost	Hardware cost reduction, scale effect	Lidar cost reduction	Promote localization of core components
Brand	User awareness, premium capability	First license plate endorsement	Strengthen positioning as a safety expert
Ecosystem	Vehicle-road collaboration, high-precision maps	Requires external cooperation	Build cooperation network

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Evaluation Dimension	Score (1-10)	Explanation
Technological Leadership	8	First L3 license + seven-layer redundant architecture
Commercialization Progress	7	Q1 2026 B-side pilot
Cost Competitiveness	6	Profit pressure before scale-up
Brand Premium Capability	7	First-mover advantage + national team endorsement
Financial Health	6	Negative cash flow, EPS lower than expected
Comprehensive Score	7.0	Overall at the upper-mid level in the industry

1. Short Term (2026)
   : The first-mover advantage will be converted into brand premium, and the L3 version of Deepal SL03 is expected to form a differentiated selling point in the pilot areas of Chongqing and Beijing, supporting product premium in the 150,000-200,000 yuan price range.
2. Medium Term (2027-2028)
   : Technology iteration speed and cost control capability will become decisive factors. Changan needs to evolve its solution from “high-safety redundancy” to “high cost-performance ratio” within 2026 to face price pressure from competitors such as BYD.
3. Long Term (2029-2030)
   : In the trillion-yuan L3 market, automakers with complete product matrices and brand awareness will gain higher market shares. Changan’s multi-brand strategy (Avatr, Deepal, Qiyuan) has long-term competitive advantages.

: Intelligent technology progress falls short of expectations, regulatory and policy advancement lags behind expectations, supply chain and cost risks increase, and intensified industry involution competition exacerbates profitability pressure [8].

According to AJ Securities’ research report, Changan Automobile is listed as one of the core beneficiaries of intelligent value enhancement [8]. The current stock price is in a sideways consolidation phase, with moderate valuation (17x P/E), and the continuous implementation of the L3 concept is expected to be a stock price catalyst. It is recommended to pay attention to:

• Catalysts
  : Launch of Q1 2026 B-side pilot operation, clear timeline for C-side function opening, approval of L3 testing in more cities
• Risk Signals
  : Slowdown in sales growth, poor cost control, technology iteration lags behind competitors

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[1] Economic Information Daily - Commercialization of L3 Autonomous Driving Accelerates Industrial Chain Layout (https://www.news.cn/tech/20260105/2126b790de364faa9f5e66cc927cb979/c.html)
[2] Autohome Column/New Energy View - L3 Autonomous Driving is Here: Don’t Talk to Me About Those Parameters, I Just Need a “Responsibility Bearer” (https://chejiahao.autohome.com.cn/info/24733837)
[3] Digital China Construction Summit - Commercialization of L3 Autonomous Driving Accelerates Industrial Chain Layout (https://www.szzg.gov.cn/2025/xwzx/qwfb/202601/t20260106_5267149.htm)
[4] News18a Auto - Changan Wins China’s First L3 License, Has the Autonomous Driving Competition Entered a New Stage? (https://www.news18a.com/news/storys_219796.html)
[5] Sina Finance - 2025 Full-Year Sales Released: Automobile Industry Maintains “One Superpower, Multiple Strong Players” Pattern (https://finance.sina.com.cn/stock/t/2026-01-08/doc-inhfqpst6732725.shtml)
[6] Eastmoney.com/Economic Daily - Witnessing the Upward Momentum of China’s Automobile Industry (https://finance.eastmoney.com/a/202601183622592245.html)
[7] Sina Finance - L3 Autonomous Driving Industry: From Testing Phase to Commercial Application (https://finance.sina.com.cn/jjxw/2026-01-08/doc-inhfpfxi7233319.shtml)
[8] Eastmoney.com - Access of L3 Models, Accelerated Development of Intelligent Vehicles (AJ Securities Research Report) (https://pdf.dfcfw.com/pdf/H3_AP202512311812060266_1.pdf)
[9] 36Kr - After Surpassing Tesla, BYD Faces Global Competition Head-On (https://www.36kr.com/p/3641566462480265)

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Report Compiled by: Jinling AI Financial Analysis Team
Data Sources: Jinling API Market Data, Economic Information Daily, Xinhua News, Sina Finance, 36Kr, etc.