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Xpeng, Li Auto given approval to test ‘hands-off’ L3 cars amid slowing market

Xpeng, Li Auto given approval to test ‘hands-off’ L3 cars amid slowing market
Two leading Chinese electric vehicle (EV) makers, Xpeng and Li Auto, have been granted licences to test their level 3 (L3) autonomous driving technologies in designated urban areas, the latest sign that Beijing is encouraging wider use of advanced driver assistance systems amid a slowing automotive market.

The green light came just one day after the Ministry of Industry and Information Technology (MIIT) gave another two carmakers – Changan Automobile and BAIC – approvals to start assembling new models fitted with L3 self-driving systems.

Xpeng, backed by Volkswagen Group, would be allowed to conduct tests on certain roads in its home base of Guangzhou, while Li Auto, a Tesla challenger in mainland China, could do the same in designated areas in Beijing, where it is headquartered, according to industry officials with knowledge of the matter.

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L3 systems are considered “hands-off” under the criteria set by global standards organisation SAE International, but drivers are still required to be fully alert to ensure that they can intervene under any circumstances.

Neither Xpeng nor Li Auto would comment on this development when contacted by the South China Morning Post on Tuesday.

Electric vehicles on show at Xpeng’s headquarters in Guangzhou, in southern China’s Guangdong province, November 5, 2025. Photo: AFP
Electric vehicles on show at Xpeng’s headquarters in Guangzhou, in southern China’s Guangdong province, November 5, 2025. Photo: AFP

Deregulation to legalise L3 technology represents a leap forward in commercialising autonomous driving systems in China, the world’s largest automotive market, analysts say.

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