Chinese EV Exec Says China Rollout Of Tesla’s Self-driving Tech Is A ‘DeepSeek Moment’ For Autonomous Vehicles

When Tesla finally launched its Full Self-Driving (FSD) platform in China earlier this year, it wasn’t just a product rollout it was a milestone. For the first time, U.S. and Chinese autonomous vehicle firms were thrust into direct competition on Chinese soil.

Moreover, Tesla’s FSD debut in China marked a long-awaited opportunity for Chinese EV manufacturers to test their self-driving tech head-to-head against a global leader. “We never had that chance,” Brian Gu told Fortune during the ASEAN-GCC Economic Forum in Kuala Lumpur. With the release of Tesla’s system on Chinese roads, that changed.

XPeng, one of China’s top EV makers, seized the moment. Gu likened this opportunity to the breakthrough achieved by Chinese AI firm DeepSeek, whose R1 large language model stunned the world earlier this year by matching U.S. competitors with far fewer resources. “The reason I say it’s very similar to a DeepSeek moment is that, compared to Tesla, the Chinese companies, including ourselves, are so much more] under-resourced,” Gu explained.

Despite being outgunned in terms of capital and computing infrastructure, XPeng’s autonomous vehicles performed well better than Tesla’s FSD, according to Gu. “The net result is actually very encouraging,” he said. “The capability of Chinese autonomous driving cars did better than FSD in Chinese streets.” Gu attributed part of this success to a localized edge: “We probably get better training of Chinese data.”

Tesla’s entry into the Chinese self-driving market wasn’t simple. The company had to navigate a web of regulatory and data-sharing hurdles. After extensive talks with Chinese officials, including Premier Li Qiang, and forging a mapping partnership with Baidu, Tesla was finally able to launch. Even then, new government rules forced an early pause on the free trial, and the system had to be rebranded from “Full Self-Driving” to “Intelligent Assisted Driving.”

It’s important to note that both Tesla’s FSD and XPeng’s current systems are classified as Level 2 autonomy, requiring a human driver to remain alert and ready to intervene. But XPeng has its sights set higher. The company announced earlier this year that it expects to complete Level 3 autonomous capabilities by late 2025 and reach Level 4 by 2026. Gu gave a slightly more cautious timeline at Fortune’s event: “Now we’re looking at potentially having Level 3 in two years; Level 4 probably in four years, that can be widely used on Chinese roads.”

The analogy to DeepSeek’s rise is particularly telling. When DeepSeek’s R1 model launched in January, it defied expectations by rivaling outputs from tech giants like OpenAI and Google but at a fraction of the cost. It was a signal to Silicon Valley that China’s AI racehorse was not just catching up; it might be pulling even.