This article is based on a speech delivered at the 2026 China Auto Forum, held from July 21st to 23rd in Shanghai's Jiading district.
Avatr Technology (Chongqing) Co., Ltd. Chairman Wang Hui delivered a keynote address outlining the critical juncture facing the Chinese automotive industry.
Wang Hui stated that most Chinese auto brands are at a pivotal crossroads of intense consolidation. He emphasized the need for a clear recognition that the industry has entered a deep-water zone of survival of the fittest. Competition is shifting from inward-looking price wars to a value-centric battle focused on the user experience.
The financial shocks and operational pressures from this transformation are unprecedented, compelling all players to re-evaluate their leadership models, R&D systems, and revenue strategies. Wang Hui stressed that this is not merely a routine product upgrade cycle but a profound contest covering the entire system's capabilities.
He believes this deep contest will lead to the "Four Major Reshapes" of the industry.
The first is the reshaping of the market landscape. The industry is moving from a single-engine growth model to a bipolar dynamic. With domestic demand under pressure, breaking through via international expansion has become the new normal. In the first half of the year, domestic auto production and sales declined year-on-year, indicating sluggish domestic demand growth and a market entering a fiercely competitive stage of stock game. Meanwhile, auto exports achieved growth exceeding expectations, becoming the core driver supporting stable industry development.
Wang Hui described the domestic market as an elimination race where you either advance or fall behind, while the overseas market is a rally race for incremental expansion. The global journey for Chinese automobiles has fully commenced. The collective overseas expansion of Chinese brands presents a significant opportunity, reducing market education costs abroad. Acceptance and recognition of Chinese brands in overseas markets are very high, instilling confidence when entering each new country. This represents an excellent opportunity for Chinese auto brands.
The second is the reshaping of the technology roadmap. Wang Hui posits that the industry's core competitive arena is rapidly shifting from the first half of electrification to the second half of intelligence. The paradigm is accelerating from "software-defined vehicles" to "AI-defined vehicles." Cars are no longer mere transportation tools but super-intelligent terminals featuring deep integration of four major intelligent systems: driving, cabin, chassis, and powertrain. Concurrently, embodied intelligence, represented by robotics, is gradually becoming a new industrial direction for society.
Wang Hui noted that 2026 is a critical window for technology to move from conceptual expectations to scaled implementation. If the first half of the industry competition was about battery capacity, the second half is about computing power. He argued that whoever establishes a generational advantage in AI and autonomous driving will control the definition of next-generation mobility. He shared that overseas partners are less focused on the next car model but rather on the next-generation AI strategy, a feeling that has become particularly pronounced this year.
The third is the reshaping of the industrial chain value, moving from vehicle supremacy to ecosystem collaboration. Wang Hui stated that the industry's value center and power hub are shifting. The traditional linear relationship between OEMs and suppliers is being completely disrupted. Leading Chinese supply chain companies in batteries and autonomous driving are upgrading from traditional component suppliers to system-level solution providers, beginning to dominate the underlying technological architecture of global smart cars. Cross-industry integration is becoming the future trend, and future competition will no longer be between individual companies but between entire ecosystems.
The fourth is the reshaping of the competition model, transitioning from product exports to industrial exports. Wang Hui said that the globalization of Chinese automobiles has now entered a deep-water zone, moving from simple finished vehicle exports to a new stage of industrial export involving local brands and local supply chains. Overseas capacity layout is upgrading from early "point-based testing" to the construction of regional manufacturing centers.
He pointed out that 2026 to 2027 is a critical period for the concentrated commissioning and production ramp-up of overseas factories for Chinese automakers. Simultaneously, Chinese automakers are accelerating their brand image upgrade by leveraging leading energy and smart technologies. They are establishing a "high-tech, Chinese car" brand perception in mature, high-end markets like Europe through differentiated technological advantages, driving China's auto exports to transition from scale leadership to quality leadership.
In conclusion, Wang Hui stated that in this era of great transformation, only by firmly committing to the transformation towards intelligence, green technology, integration, and globalization can the industry turn challenges into opportunities within this wave of industrial change.
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