Frost & Sullivan: Robotaxi into policy and “double acceleration” channel

This year, Shanghai released the 'Shanghai High-Level Autonomous Driving Pilot Zone "Model Speed Smart Mobility" Action Plan" (hereinafter referred to as the 'Action Plan') at the World Artificial Intelligence Conference (WAIC) in 2025. Its main contents can be summarized into the following key points: 1) Large-scale autonomous driving, with clear targets for passenger capacity and road testing of Level 4 autonomous driving, far exceeding previous pilot operations in small areas and limited capacity; 2) Networked application scenarios, aiming to build a regional comprehensive operation network, breaking the previous limitations of point and block testing areas; 3) Industrial ecosystem, promoting the construction of an autonomous driving industry ecosystem that includes complete vehicles, core components, algorithms, data, and operational services.

From the perspective of industrial development, the release of the 'Action Plan' marks a determination to accelerate the further scale-up and commercialization of China's autonomous driving and Robotaxis industries. The 'Action Plan' conveys confidence in the continuous improvement of autonomous driving technology maturity and reveals an urgent need for the commercial implementation of Robotaxis. At the same time, achieving large-scale commercial operation of Robotaxis in Shanghai and forming a complete 'Shanghai solution' that includes technical standards, operational norms, safety supervision, and regulatory applications will provide a model for further promoting the implementation of Robotaxis nationwide and greatly accelerate the development progress of the Robotaxis market. Compared with previous small-scale commercial pilot deployments of Robotaxis in specific areas by cities such as Guangzhou and Shenzhen, the 'Action Plan' clarifies the policy attitude towards truly integrating autonomous driving into urban transportation ecosystems and the urgent need to break through profit bottlenecks and operational models brought about by regional pilots. This also indicates that China's autonomous driving policy will develop in a more systematic and open direction.

Firstly, technical capabilities are the foundation for Chinese intelligent driving solution providers to successfully expand overseas markets. From a technical capability perspective, Chinese intelligent driving solution providers represented by Pony.ai have formed a relatively mature intelligent driving technology solution and service system through years of research and development, testing, and verification, and possess the ability to quickly deploy operations in new regions.

Secondly, from an enterprise strategic perspective, going overseas is an operational choice for Chinese intelligent driving solution providers to develop revenue growth points and seek commercial scale expansion. Furthermore, operating Robotaxis in different countries, with different regulations and traffic environments, gives Chinese intelligent driving solution providers the opportunity to participate in or even lead the formulation of some regional and even global autonomous driving technology standards, safety standards, and operational norms. At the same time, cooperation with global or regional transportation giants is a practical exploration of the 'technology empowerment + localized operation' business model by Chinese intelligent driving solution providers, which helps them understand user habits, payment systems, and regulatory requirements in different markets and accumulate experience for building replicable and scalable global business models.

Currently, looking at the global market, except for the United States, regions such as the Middle East, Southeast Asia, and Europe show a high market acceptance and commercial progress visibility for new business models like Robotaxis. The Middle East region, represented by the UAE, has made the development of smart cities and future transportation an important national strategy. In terms of commercial progress, Pony.ai has also reached an agreement with the Dubai Roads and Transport Authority to start road testing this year. In the Southeast Asian market, Singapore, as the world's first country to carry out public Robotaxis trial operations, has always maintained a globally leading development process in terms of relevant policies and regulatory systems; Pony.ai and Baidu's RoboRover are both expected to land in Singapore this year for commercial operations. In Europe, countries such as Germany, France, and the United Kingdom are also accelerating the development of the Robotaxis market. German automakers such as Volkswagen and Daimler have participated in the demonstration operation of Robotaxis projects in their respective countries; WeRide will carry out pure driverless commercial operations in France through strategic cooperation; the United Kingdom will launch a Robotaxis pilot operation in London in 2026.

The main reasons for the accelerating advancement of the global and Chinese Robotaxis markets this year can be seen from three dimensions: technical maturity, commercial verification, and policy promotion:

At the technical level, the maturity of Level 4 autonomous driving technology has further improved. The 'multi-sensor fusion + modular system' solution represented by Waymo has verified through large-scale testing that the safety and reliability of Robotaxis have gradually reached the commercial threshold; Tesla's 'end-to-end model-driven pure vision solution' has significant economies of scale, iterative efficiency, and expansion capabilities, with extremely high commercial potential. In terms of commercial verification, Chinese Robotaxis companies represented by Baidu Apollo, Pony.ai, and Baidu RoboRover have demonstrated the feasibility of Robotaxis commercialization after multiple verifications from technical testing to fully driverless commercial demonstrations. From a policy perspective, the US Department of Transportation issued relevant policies in April 2025 to simplify unmanned driving technology testing and reporting; first-tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen have further opened up Robotaxis commercial operations this year; countries and regions including the Middle East, Europe, and Japan are also actively following up on policy support for Robotaxis. Under the resonance of multiple factors, the Robotaxis market in 2025 showed a 'spring after rain' trend.

The downward trend in the mass production and operational maintenance costs of Robotaxis is highly predictable. Take lidar as an example. In the past, lidar was a core bottleneck restricting the cost of Robotaxis, mainly due to limited production capacity in the early stages of technology development. With the technological upgrading and large-scale mass production of related industries, lidar prices have dropped significantly in recent years. According to public information, the cost of lidar in Pony.ai's seventh-generation autonomous driving system will be reduced by 68%. Other core components, such as automotive-grade chips, are also expected to see significant cost optimization with further optimization of single-chip computing power and the gradual mass production application of domestic automotive-grade chips. It is estimated that in the next two years, the market will see significant reductions in the mass production and operational maintenance costs of Robotaxis.

From a technical perspective, there is strong commonality in the underlying technical architecture between Robotaxis and Robotruck, enabling a certain degree of technical reuse in basic perception and planning algorithms such as traffic rules, lane line recognition, and basic obstacle classification. The data accumulation during operation of Robotruck can also provide technical transfer value for the training of autonomous driving models (such as long-distance target recognition and lane keeping) by Robotaxis. Overall, the experience accumulation of Robotruck in the trunk logistics field is undoubtedly beneficial for promoting the development of Robotaxis. Through technical reuse and data feedback, Robotruck can provide a solid foundation for the development of Robotaxis.

Compared with Robotruck, Robotaxis faces more complex operating scenarios. The main operating scenario of Robotruck is highways, where road rights are relatively clear, traffic participant types are relatively single, and the scenario complexity is relatively low compared to urban scenarios. In contrast, the urban scenarios where Robotaxis mainly operate have significantly increased complexity, facing challenges such as mixed traffic of people and vehicles, complex intersections, dynamic environments (such as temporary road construction, traffic control, roadside illegal parking), etc., which require extremely high real-time perception and planning capabilities of autonomous driving systems. In addition, the tolerance rate for misjudgment in urban environments is extremely low. Autonomous driving systems need to achieve low-threshold safe interaction and realize the full-link process of 'perception - decision - execution' in an extremely short time. These differences in factors pose more stringent technical requirements for Robotaxis autonomous driving systems.