Another luxury automaker is tapping into China’s EV tech goldmine

Yet another luxury automaker is looking to cash in on China’s EV tech boom. As legacy OEMs struggle to keep pace, more are turning to Chinese-made tech to help turn things around.

Luxury automakers are adopting China’s EV smart tech

It’s no secret by now that China is dominating the electric vehicle market, not only with lower prices, but often with more advanced tech.

According to Rho Motion, China led the global market last year with EV sales surging 40% compared to 2023. Led by BYD and other domestic brands, the Chinese market is not slowing down. Through the first two months of 2025, BEV sales in China are up 46% from last year.

With a wave of new models arriving, automakers are now looking overseas to drive growth. BYD alone has sold over 130,000 EVs overseas so far this year.

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Several luxury automakers are scrambling to catch up after losing significant market share in China. And now, they are starting to feel the heat in overseas markets.

Audi partnered with SAIC last year to launch a new premium brand based on a China-specific EV platform. The first model, the Audi E concept, debuted last November.

Mercedes-Benz is reportedly the latest luxury automaker that will use China’s EV smart tech. A Source with direct knowledge of the matter told Reuters that Mercedes-Benz will use Hesai’s lidar sensors to develop smart driving cars.

Unlike Audi though, Mercedes-Benz will sell vehicles with Hesai’s smart tech outside of China, a first time for a foreign brand.

According to the source, Mercedes reportedly debated it for months but eventually chose Hesai because it is cheaper and easier to scale.

A Mercedes said the company does not comment on speculation with suppliers. Meanwhile, just this week Hesai announced a new “multi-year Lidar contract” with a leading European OEM.

And German automakers are not the only ones. South Korea’s Genesis is reportedly looking to localize EV production in China.

Electrek’s Take

Although it may not seem like much, the decision, if true, could be big. With Trump threatening to slap more tariffs on the US’s biggest trade partners, global automakers will increasingly turn to China for more affordable, and in many cases, more advanced technology.

Hesai is already one of the largest lidar makers, accounting for over a third of the global market. In December, it became the first lidar company to deliver more than 100,000 units in a single month.

The company also competes with US-based Luminar. Trump’s threats are already doing more harm than good, with nearly every automaker warning they will put the US auto and tech industry behind. Which global automaker will be next to turn to China for EV resources?