BYD Unveils First In-House 4nm Autonomous Driving Chip

Chinese electric vehicle giant BYD Co. Ltd. has unveiled its first self-developed autonomous driving chip, the Xuanji A3, marking a major milestone in the company’s vertical integration strategy and China’s broader push for semiconductor self-reliance. The 4-nanometer chip, which supports L3 and L4 autonomous driving capabilities, has already entered mass production, according to Caixin Global.

BYD Chairman Wang Chuanfu introduced the chip on May 28 at the company’s intelligence strategy launch event in Shenzhen, calling it “the highest level of intelligent driving chips in China.” The Xuanji A3 delivers approximately 700 TOPS (trillion operations per second) per single chip, with a three-chip cluster configuration reaching a combined computing power of over 2,100 TOPS.

A Strategic Leap in Vertical Integration

BYD has long pursued a strategy of vertical integration, manufacturing many of its own components from batteries to power semiconductors. The Xuanji A3 represents the next logical step: bringing autonomous driving chip design in-house. The company established its integrated circuit design department as early as 2002, which later became the predecessor to BYD Semiconductor, as CnEVPost reported.

Today, BYD Semiconductor employs over 7,000 R&D staff across four major chip research and development bases, and the company has invested more than 100 billion yuan (~$14.75 billion) in semiconductor research and development. To date, BYD has launched over 2,000 chip products and operates five wafer fabrication facilities, including China’s largest 12-inch automotive-grade wafer plant.

BYD claims to be the only automaker globally with full-process chip manufacturing capabilities, mastering seven core steps from product definition and architecture design to wafer manufacturing and testing. However, the Xuanji A3’s advanced 4nm computing chip, while designed in-house, is produced by an overseas foundry — underscoring the continued gap in domestic chip manufacturing capabilities despite China’s push for technological self-sufficiency.

The Chinese EV Chip Race Heats Up

BYD is not alone in developing proprietary chips. The broader trend among Chinese EV makers reflects a strategic shift away from reliance on external suppliers like Nvidia and Qualcomm. According to Electrek, the Xuanji A3’s computing power utilization rate has increased by 100% through deep optimization with BYD’s in-house algorithms, which power the company’s DiPilot 300 (“God’s Eye B”) LiDAR-based assisted driving system.

BYD’s competitors have been similarly active:

• Nio debuted its 5nm Shenji NX9031 chip in March 2025, which has been widely applied across its main brand and sub-brand Onvo. Nio CFO Yu Qu stated in June 2025 that using proprietary chips reduced costs by approximately 10,000 yuan (~$1,477) per vehicle.
• XPeng began deploying its Turing AI chip (750 TOPS) in July 2025 and had transitioned nearly all main products to the proprietary chip by April 2026. Chairman He Xiaopeng emphasized that proprietary chips allow customization for in-house AI models.
• Li Auto unveiled its Mach M100 chip (5nm, 1,280 TOPS) on May 12, debuting on the Li L9 Livis flagship SUV. Chairman Li Xiang stated that AI-era competition involves systemic capabilities integrating chip architecture, operating systems, and algorithmic models.

As TechNode noted, the collective shift toward in-house chip development highlights a broader industry trend of Chinese EV makers pursuing deep software-hardware integration to secure a competitive edge.

Market Position and Cost Advantages

BYD sold over 4.6 million new energy vehicles (NEVs) in 2025, giving it the scale necessary to make self-developed chips cost-effective. The DiPilot 300 system will be available as a paid extra option for 12,000 yuan (~$1,770) on entry-level models, including the Seagull compact hatchback — a vehicle that starts at just 69,800 yuan ($10,300). This makes LiDAR-based advanced driver assistance accessible at price points previously unimaginable.

According to CarNewsChina, BYD’s long-term goal is zero traffic accidents. The company has more than 3.15 million vehicles equipped with advanced driver-assistance hardware on the road, generating roughly 200 million kilometers of driving data daily — a massive dataset for training autonomous driving algorithms.

Geopolitical and Industry Implications

China’s EV industry has been under pressure from US export controls on advanced semiconductors. Developing proprietary chips reduces dependence on US companies like Nvidia and Qualcomm, aligning with Beijing’s push for “domestic substitution” (国产替代). The Wall Street Journal reported on the significance of BYD’s chip announcement in the context of escalating US-China technology tensions.

However, the fact that the Xuanji A3’s 4nm chip is still produced by an overseas foundry — likely TSMC or Samsung — highlights the persistent challenge facing China’s semiconductor ambitions. While BYD can design cutting-edge chips, advanced manufacturing remains beyond domestic capabilities for now.

What to Watch For

Several key questions remain unanswered. BYD has not disclosed which overseas foundry is producing the Xuanji A3, which vehicle model will first feature the chip, or the specific deployment timeline for production vehicles. It also remains unclear whether the chip will be compatible with third-party smart driving systems.

As Chinese EV makers race to develop proprietary silicon, the competitive landscape is shifting from price to intelligence. BYD’s massive production volume makes in-house chip development economically viable — a scale advantage few competitors can match. The success of this strategy will depend on whether the technology can deliver on its promise of safer, more capable autonomous driving, and whether consumers in a market saturated with discounted EVs are willing to pay for it.

This article was compiled from reports by Caixin Global, CnEVPost, Electrek, TechNode, CarNewsChina, and the Wall Street Journal.