As China accelerates its semiconductor self-reliance, automakers with greater control over their chip supply could gain an edge in intelligent vehicles and emerging physical AI markets, according to a report by research firm Digitimes.

Chinese automaker BYD's decades-long investment in chip design and manufacturing illustrates how control of key semiconductor technologies can boost competitiveness as export controls spur adoption of domestic alternatives, it says.

Digitimes expects China's localization drive to expand from traditional automotive chips to smart-driving processors, while the convergence of the EV and robotics industries gathers pace. Expertise in AI chips, sensors, motors and control systems could create new opportunities as humanoid robots and other physical AI applications move toward broader adoption, it says.