Self-driving cars continue to face an uphill road despite a decade of hype, lacking any major commercial success and the big bucks that brings. Chinese companies faced extra challenges in 2022, a year pockmarked with business shutdowns, bankruptcies, and layoffs, as the nation implemented some of its toughest-ever restrictions in its now-abandoned effort to control the latest Covid outbreaks.
All that negativity has put the brakes on investor sentiment towards the sector. Companies from the group raised just north of 20 billion yuan ($2.9 billion) in China last year, down nearly 80% from the previous year’s 93.2 billion yuan, according to data compiled by news portal Sohu. One of the dwindling number still able to entice investors is Freetech Intelligent Systems Co. Ltd., which announced raising new money late last month, bringing its new fundraising to nearly 1 billion yuan ($147 million) since late last year.
With expectations that truly autonomous vehicles may be years – if not decades – away, investors are now increasingly favoring startups like Freetech, which are taking an incremental approach by first focusing on developing Advanced Driver Assistance System (ADAS) products. But the company is facing growing competition as rivals increasingly pile into the ADAS space as well.