TL;DR
BYD introduced Xuanji A3, China’s first automotive-grade 4nm chip for self-driving cars, delivering 700 TOPS per chip. The company is expanding its God’s Eye driver-assistance system to mass-market electric vehicles, including the $10,300 Seagull, as eight straight months of declining sales and a 55% drop in profits have forced a technology-driven turnaround.
BYD has unveiled the Xuanji A3, which it calls China’s first automotive-grade 4-nanometer chip for self-driving cars. CEO Wang Chuanfu chip announced at the event It delivers the lowest power consumption for a computing unit in its class, drawing about 20% less than comparable semiconductors, BYD said at its Shenzhen headquarters on May 28. The chip has already entered mass production.
A single Xuanji A3 provides 700 TOPS of computing power. A cluster of three chips reaches 2100 TOPS, which is enough to support Level 3 and Level 4 autonomous driving functions. The chip is the centerpiece of a new laptop-sized central computing platform that integrates three previously separate vehicle areas: the intelligent cockpit, the driver assistance system and the main electric motor.
The semiconductor is approaching the capabilities of Huawei Technologies, which currently makes automotive chips with 7nm geometry but promises to debut 1.4nm chips by 2031. The most advanced chip globally is TSMC’s 2nm N2 node. BYD’s ability to design and mass-produce its own 4nm drive chip deepens its vertical integration strategy, which already includes batteries, motors and vehicle manufacturing.
God’s Eye goes to the mass market
Along with the chip, BYD announced that it will expand its God’s Eye driver assistance system to all models sold in China, including mass-market vehicles such as the Seagull compact hatchback. It starts at 69,800 yuan ($10,300).. When the 2026 model goes on sale on May 11, the Seagull becomes the first car in its class to get LiDAR, a technology previously reserved for premium cars.
The upgraded God’s Eye system, which includes city and highway navigation, traffic light recognition and automated parking, will be available for an additional 12,000 yuan ($1,770). Wang described the prices as cost only. BYD also offers a one-year insurance that fully covers damage caused by accidents during the launch of the latest version of God’s Eye, a direct bet that the system is reliable enough to underwrite.
A system with a problematic experience
The insurance lien comes after months of complaints about the operation of God’s Eye. Last year, BYD made the system a standard feature on most of its cars, but the initial release used a high-end structure that limited advanced city navigation to more expensive models, giving affordable cars only basic highway cruise control. Users reported dangerous faults including unintended acceleration, erratic lane changes and steering that almost sends cars into oncoming traffic.
Unlike Tesla’s optional Full Self-Driving package, BYD has installed God’s Eye in millions of cars, meaning every flaw is exposed at scale. The company said there are more than 3.15 million vehicles equipped with advanced driver assistance devices on the road, generating about 200 million kilometers of driving data every day. BYD uses this data to train its algorithms through cloud-based world models and reinforcement learning, with iteration cycles running every three days.
Eight months of sales decline
The technology push comes at a difficult time for BYD’s business. Sales have declined year-over-year for eight months in a rowApril 2026 volumes were down about 16% year-over-year. First quarter net profit It fell 55% to 4.09 billion yuan ($599 million). As a fierce price war in China and a stronger yuan squeezed margins.
Revenue fell 12% to 150.2 billion yuan in the quarter. Operating costs have risen as BYD invests in smart driving equipment while lowering vehicle prices to compete with rivals including Xiaomi, which is entering the EV market with high-performance models, and Huawei, which is bolstering its presence. The only bright spot was exports, which surged more than 70% year-on-year in April to a record high of 135,098 units.
Competitive context
Tesla has finally launched its fully self-driving system in China after years of delays, but the technology still requires active human intervention and will be launched under a different name, according to an investigation by Chinese transport authorities. Tesla relies on a vision-only approach, using cameras and neural networks without LiDAR or radar, a fundamentally different and cheaper strategy that BYD and other Chinese automakers have criticized as less capable.
China’s Ministry of Industry and Information Technology issued the first Level 3 autonomous driving certificates in December 2025, approving Changan Auto and BAIC Motor vehicles. BYD expects China to formalize legislation that would allow for more widespread consumer use of self-driving vehicles, expected in 2027. Chinese EV makers are also aggressively expanding overseasBYD aims for 1.3-1.6 million international deliveries in 2026.
The Xuanji A3 chip and God’s Eye expansion represent BYD’s attempt to shift the competitive battlefield from price to technology. A company that made its name in affordable electric cars is now trying to prove it can build the silicon, software and sensor systems needed to compete on intelligence. Whether the strategy works depends on whether the technology can overcome complaints and whether drivers are willing to pay 12,000 yuan for a feature in a market saturated with discount electric cars. Competitors supported by Huawei and fragmenting global EV market they also compete to deliver.
