Welcome back to China Insights Weekly. Here are some of the highlights of this release:
- Leica changes its sensor strategy and is working with Chinese company Gpixel on its own development.
- Tesla meets data protection requirements and came close to launching autonomous driving in China.
- China pushes domestic wafers and is targeting a share of domestic suppliers for 70% this year.
- Tencent strengthens in the gaming industry after Supercell bought Metacore, the maker of Merge Mansion.
Main News
In the week ending May 3, China's major language models recorded 7.942 trillion API calls, an increase of 81.7 % from the previous week. This surpassed US models, which saw their call count drop by 34.6 % to 3.258 trillion. Tencent's Hy3 Preview model led globally with 3.03 trillion weekly calls, an increase of 799 %. Kimi K2.6 came in second place. MiniMax M2.7 came in eighth with 729 billion calls, while DeepSeek-V4-Flash debuted in ninth place with 704 billion calls (an increase of 344 %). The total number of AI model calls worldwide increased by 8.6 % to 23.9 trillion tokens. The data suggests that China's AI models are not only advancing rapidly, but also achieving large-scale practical deployment and changing the competitive landscape. Chinese authorities have issued the first joint guidelines prepared by the Cyberspace Administration of China, the National Development and Reform Commission (NDRC) and the Ministry of Industry and Information Technology (MIIT) to promote the standardized use and innovative development of AI agents.
The document defines AI agents as intelligent systems capable of autonomous perception, memory, decision-making, interaction and task performance. It lays down basic principles emphasising safety, controllability, due process, standardisation, innovation-driven growth and orientation towards practical application. The guidelines provide 19 typical application scenarios in the fields of scientific research, industrial development, consumption promotion, public welfare and social governance.
Germany's Leica is changing its sensor strategy and partnering with China's Gpixel instead of Japanese suppliers. It is moving from a traditional supplier relationship to joint development, image quality fine-tuning and production preparation. Founded in 2012 and operating in China, Japan and Europe, Gpixel is helping Leica accelerate its return to in-house sensor development, which Leica started in 2022.
Leica, with an annual turnover of around 500 million euros, considers China one of its most important markets and has worked with Xiaomi and Huawei on smartphones in the past. Gpixel, despite having lower turnover, is growing rapidly after listing on the Hong Kong stock exchange. The partnership aims to give Leica more control over a key technology and strengthen its differentiation in the premium camera segment.
Tesla has complied with Chinese data security requirements and entered into an agreement with Baidu to obtain a mapping license. This will allow the carmaker to collect data from public roads and integrate Baidu's navigation system with lane-level accuracy.
The agreement removes a key regulatory barrier to the introduction of autonomous vehicles in China. Tesla's factory in Shanghai, which opened in 2019, produced more than 710,000 cars in 2022 alone. Since entering the Chinese market a decade ago, Tesla has sold more than 1.7 million cars in China. Chinese Premier Li Qiang called Tesla's development in China an example of successful economic and trade cooperation between the two countries.
China's shipping industry recorded across-the-board growth in the first quarter. The volume of completed ships reached 15.68 million deadweight tonnes (DWT), representing a year-on-year increase of 46 % and 57.3 % of the world total. New orders rose by 195.2 % to 59.53 million DWT, equivalent to 84.9 % of the world market. The order backlog was 322.30 million DWT (an increase of 43.6 %), representing 69.8 % of the global total. Of the 18 major ship types, China topped the new orders for 15 categories. For large vessels - VLCC tankers, large car carriers, bulk carriers and container ships of 10,000 TEU and above - China's international market share exceeded 90 % in each segment.
China has set an unofficial requirement for chipmakers to buy 70 % of their silicon wafers from domestic suppliers this year, leaving foreign firms with only 30 % of the market. The trend is led by Xi'an Eswin Material Technology, which aims to produce 1.2 million 12-inch wafers per month by 2026. This would be enough to meet about 40 % of domestic demand and increase its global market share above 10 %. Eswin is already supplying SMIC and its products are also being tested by South Korean firms Samsung and SK Hynix.
In 2025, China will meet about 50 % of domestic demand for 12-inch wafers. The share of domestic manufacturers in global production capacity rose from 3 % in 2020 to 28 % in 2025 and could reach 32 % in 2026. China is already largely self-sufficient in 8-inch wafers for mature chips.
Tomáš Kučera & Yereth Jansen
China-insights.com/gnews.cz - GH
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