In Depth: Who Takes Responsibility When Self-Driving Cars Crash?

Smart-driving technology has rapidly become a focal point of competition in China’s automotive industry, with carmakers striving to lead in intelligent mobility by rolling out vehicles equipped with advanced driver assistance systems. However, this technological race is also fraught with risks. A stark example occurred on March 29, when a Xiaomi SU7 electric sedan, operated under its intelligent driving system, crashed into a concrete divider, killing all three university students inside after the vehicle burst into flames. This tragedy underscored the potential dangers of advanced driving technology and ignited a nationwide debate about the proper use of such systems and the pervasive marketing-driven misconceptions about their capabilities. Industry leaders like Yu Kai, CEO of Horizon Robotics, have raised concerns over companies exaggerating the abilities of their driver assistance technologies, and have called for stronger government actions to curb misleading promotions and protect consumers [para. 1][para. 2][para. 3].

Since mid-2024, competition among China’s new energy vehicle (NEV) makers has intensified, with a rush to introduce mass-market models equipped with smart driving features suitable for both highways and urban environments. For instance, in July 2024, Guangzhou Automobile Group’s Aion brand launched a smart SUV priced at 160,000 yuan (about $22,000). Soon after, industry leader BYD released 21 budget cars featuring its “God’s Eye” intelligent system, priced from 70,000 yuan to 200,000 yuan. This price war among major players has made smart cars more accessible, but also raised concerns, as competition has led to the blurring of lines between assisted and autonomous driving in advertising. Car companies often highlight the “self-driving” capacities of their systems, although manuals still require drivers to stay attentive and ready to take control, reflecting legal and liability considerations [para. 4][para. 5][para. 6][para. 7][para. 8][para. 9][para. 10].

The Chinese authorities have responded to these issues. On April 16, 2024, the Ministry of Industry and Information Technology (MIIT) summoned representatives of about 60 car companies, directing them to tone down the hype in their advertising about driver assistance systems, stop using terms like “autonomous driving” for Level 2 systems, and standardize over-the-air (OTA) software updates. OTA updates, which allow companies to upgrade smart driving features after purchase, have become a major selling point but also pose risks, as immature technologies can be released to consumers prematurely [para. 11][para. 12][para. 13][para. 14][para. 15].

Driver assistance and autonomous driving systems are classified from Level 0 to Level 5, with Level 1 and Level 2 systems requiring the driver to stay in control at all times. In 2024, approximately 59.7% of new passenger cars sold in China were equipped with Level 2 systems. The Chinese government aims to have vehicles with Level 3, or “conditional,” automation mass-produced by 2025. Several automakers have been allowed to test Level 3 vehicles, but this raises further regulatory challenges, particularly around accident liability. While current guidelines typically hold the driver responsible for accidents with autonomous driving features turned on, proposed revisions would clarify accountability and insurance standards as the adoption of Level 3 systems increases. Leading firms like GAC, XPeng, and Huawei have announced plans to launch Level 3 systems in the near future, indicating that the smart-driving push will continue even as regulators work to update policies and standards for this new era of mobility [para. 16][para. 17][para. 18][para. 19][para. 20][para. 21][para. 22][para. 23][para. 24][para. 25][para. 26].