Who Will Win the Self-Driving Car Race—The U.S. or China?

The dream of a car that drives itself has long fascinated automakers and tech companies. Today, that dream is becoming a reality, but the pace of progress depends on where you look. In the US, companies like Waymo and Tesla are pushing forward, though not without setbacks. In China, the rollout is happening faster, bigger, and with strong government backing. The rapid development in China is not about who will be the leader in autonomous driving, but rather how long the US can keep its lead, if it has any.

The U.S.: Progress with Roadblocks

In the United States, Waymo has become the most established name in autonomous driving. The Alphabet-owned company already operates fleets of robotaxis in San Francisco, Los Angeles, Phoenix, and Austin, and is rapidly expanding into new cities. Its vehicles have completed millions of paid rides and, according to published data, outperform human drivers in safety. Waymo also recently earned approval to operate at San Jose’s airport, highlighting that self-driving technology is moving from experiment to everyday service.

Tesla, meanwhile, has taken a different route. The company recently launched a limited robotaxi pilot in Austin, using around 10–20 Model Y vehicles equipped with its Full Self-Driving software. However, the cars are not truly driverless yet. Each vehicle currently operates with a safety driver onboard, seated in the driver’s seat to monitor the ride. CEO Elon Musk has said Tesla plans to remove human monitors by the end of 2025, but regulators will need to sign off before that happens. Tesla’s reliance on cameras rather than lidar sets it apart from rivals, though experts remain divided on whether that approach can handle complex urban conditions.

Not all U.S. automakers are leaning in. Stellantis, the parent company of Jeep, Chrysler, and Dodge, recently announced it was shelving its self-driving projects. The company cited costs and uncertainty surrounding consumer demand, highlighting the challenge of balancing innovation with profitability.

China: Full Speed Ahead

China, by contrast, is racing forward with large-scale deployments. Baidu’s Apollo Go service already runs fully driverless taxis in megacities like Wuhan and Chongqing. Riders can hail a car through an app and be picked up with no one in the driver’s seat. This level of adoption is still years away in most American cities, yet in China, it is already a part of daily life. Baidu has also introduced the RT6 robotaxi, a purpose-built vehicle costing under $30,000, which is much cheaper than Waymo’s sensor-laden fleet.

At the same time, Chinese automakers are investing heavily in homegrown technology. Companies like Xpeng have developed AI chips designed explicitly for self-driving systems, thereby reducing their reliance on foreign suppliers like Nvidia. Analysts say this positions China not just as a fast adopter but as a true technology leader.

Perhaps most importantly, the Chinese government is fueling the industry with subsidies, fast-track approvals, and a willingness to let companies test at scale. Studies predict that by 2030, one in five new cars sold in China will be fully autonomous, while most others will come with advanced driver-assistance features.

Who’s Winning the Race?

The U.S. remains a leader in safety validation and regulatory oversight, with Waymo establishing global standards for reliability. In the meantime China is turning autonomy into a mass-market reality, with government-backed robotaxis, more affordable vehicles, and a consumer base eager to adopt the technology. Industry experts are increasingly concerned that the U.S. may be falling behind. A recent McKinsey report noted that expectations for America to lead in Level-4 autonomy have dropped sharply, with analysts now evenly split between China and the U.S.

One thing is for sure. Developing self-driving capabilities is not easy or cheap. Even if the technology is almost ready, cars with complex, advanced systems like LIDARs are extremely expensive, and not all manufacturers see the benefit of developing their own systems.

We believe many brands will adopt a similar approach, as seen with EV batteries. They will buy a ready-made technology from a sub-supplier rather than developing their own system. This can make the technology more affordable and widely accessible in the future. But will it be a US-based technology or a Chinese one? As of today, we strongly believe that even if the Chinese technology is available off the shelf, US lawmakers will ban its use in the United States due to national security concerns.