The TL;DR
BYD introduced Xuanji A3, China’s first 4nm standard chip for self-driving cars, delivering 700 TOPS per chip. The company is expanding its God’s Eye driver assistance program to several EVs in the market including the $10,300 Seagull, as eight consecutive months of declining sales and a 55% drop in profits forced a technology-led pivot.
BYD has introduced the Xuanji A3, which they call China’s first automotive grade 4-nanometer chip for self-driving cars. CEO Wang Chuanfu announced the chip at an event at BYD headquarters in Shenzhen on May 28, saying it delivers the lowest power consumption per computing unit in its class, drawing about 20% less than similar semiconductors. The chip has already entered mass production.
A single Xuanji A3 delivers 700 TOPS of computing power. The set of three chips reaches 2,100 TOPS, which is enough to support Level 3 and Level 4 automated driving functions. The chip is the basis of a new laptop-sized central computer platform that integrates three previously separate automotive domains: intelligent cockpit, driver assistance system, and electric core propulsion.
The semiconductor is approaching the capabilities of Huawei Technologies, which currently makes automotive chips in 7nm geometry but has promised to release 1.4nm chips by 2031. The most advanced chip in the world is TSMC’s 2nm N2 node. BYD’s ability to design and mass-produce its 4nm driver chip deepens a vertical integration strategy that already includes batteries, motors, and vehicle manufacturing.
God’s Eye goes mass market
On the chip side, BYD has announced that it will extend its God’s Eye driver assistance program to all models sold in China, including mass-market vehicles such as the Seagull compact hatchback, which starts at 69,800 yuan ($10,300). The Seagull became the first car in its class to get LiDAR when the 2026 model was launched on May 11, a technology reserved for premium cars.
The advanced God’s Eye system, which includes city and highway navigation, traffic light recognition, and automatic parking, will be available as an add-on for 12,000 yuan ($1,770). Wang described the prices as costs only. BYD also offers a one-year insurance policy that fully covers damage from accidents that occur while the latest version of God’s Eye is still running, a sure bet that the system is reliable enough to document.
A program with a troubled history
This insurance pledge comes after months of complaints about the operation of God’s eye. BYD made the system a standard feature on many of its cars last year, but the initial release used a tiered structure that limited advanced city navigation to expensive models while offering affordable cars only basic highway cruise control. Users reported dangerous malfunctions including unintended acceleration, erratic lane changes, and steering inputs that almost sent cars into oncoming traffic.
Unlike Tesla’s optional Full Self-Driving package, BYD rolled out God’s Eye to millions of cars, meaning every flaw is visible at scale. The company says it has more than 3.15 million vehicles equipped with driver assistance hardware, generating nearly 200 million kilometers of driving data every day. BYD uses that data to train its algorithms using cloud-based global models and reinforcement learning, with iterative cycles running every three days.
Eight months of declining sales
The technology push comes at a difficult time for BYD’s business. Sales have declined year-over-year for eight consecutive months, and April 2026 was down nearly 16% compared to the same period last year. First-quarter net profit fell 55% to 4.09 billion yuan ($599 million) as a tough price war in China and margins were squeezed by the strong yuan.
Revenue fell 12% to 150.2 billion yuan in the quarter. Operating costs have risen as BYD has invested in smart driving hardware while at the same time reducing vehicle prices to compete with rivals including Xiaomi, which has entered the EV market with high-performance models, and Huawei-backed products that have strengthened its presence. The only bright spot was exports, which rose more than 70% year-on-year to a record 135,098 units in April.
Competitive context
Tesla has finally launched its Full Self-Driving system in China after years of delays, but the technology still requires active human intervention and will be sold under a different name due to inspections 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 too incompetent.
China’s Ministry of Industry and Information Technology issued its first Level 3 autonomous driving certificates for December 2025, approving vehicles from Changan Auto and BAIC Motor. BYD is waiting for China to formalize a law that would allow the mass export of self-driving cars to consumers, which the company expects as soon as 2027. Chinese EV makers are also expanding overseas, with BYD aiming for 1.3 to 1.6 million international deliveries by 2026.
The Xuanji A3 chip and the God’s Eye expansion represent BYD’s attempt to shift the competitive battlefield from price to technology. The 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 in intelligence. Whether the strategy works depends on whether the technology can overcome complaints, and whether drivers in a market saturated with discount EVs are willing to pay 12,000 yuan for a feature that rivals backed by Huawei and the fragmented global EV market are racing to bring.
