China’s automotive sector, a cornerstone of the nation’s manufacturing landscape, is undergoing a comprehensive digital transformation to adapt to global technology shifts, rising competition, and the demands of the next generation of mobility.

On December 30, 2025, the Ministry of Industry and Information Technology (MIIT), Ministry of Education, State Administration for Market Regulation, and National Data Administration jointly released the Implementation Plan for Digital Transformation of the Automotive Industry (汽车行业数字化转型实施方案), outlining coordinated actions and benchmarks for digitalization, intelligent manufacturing, and technology integration across the industry by 2027 and 2030. This policy represents a significant effort to strengthen China’s automotive value chain through enhanced digital capabilities, innovation ecosystems, and industrial modernization.

Executive Summary

• The Implementation Plan for Digital Transformation of the Automotive Industry was issued by the Ministry of Industry and Information Technology, Ministry of Education, State Administration for Market Regulation, and National Data Administration on December 30, 2025.
• The plan sets two major milestones: by 2027, significant progress in intelligent manufacturing and digital integration; by 2030, a high degree of industry-wide digitalization with deep fusion of digital technology and business processes.
• The strategy identifies six key action categories encompassing digital diagnosis, SME empowerment, scenario demonstration, gradient cultivation, standardization, and core technology breakthroughs.
• Specific development goals include increasing digital tool adoption, enhancing production efficiency, shortening development and delivery cycles, and expanding supplier digital capabilities.
• To support implementation, the plan emphasizes technology integration, industrial internet platforms, AI applications, and public digital service infrastructure.
• For the business community, the plan signals accelerating demand for digital solutions, talent development, ecosystem cooperation, and standards-based interoperability.

The Automotive Industry’s Role in China’s Economy

The automotive industry occupies a central position within China’s manufacturing sector due to its extensive supply chains, strong employment linkages, and high value-added components. As global competition intensifies, the strategic focus has shifted toward enhancing resilience and competitiveness through digital transformation, particularly in response to the rise of connected, electric, and autonomous vehicles. Domestic policies and industrial plans, including this implementation scheme, align with broader government objectives to modernize industrial bases and leverage digital technologies to foster sustainable and intelligent growth.

By setting a clear roadmap for digital transformation, Chinese authorities aim to ensure that the automotive sector does not merely adapt to digital trends but leads in technology adoption and integrated digital management.

Dual-Phase Development Targets: 2027 and 2030

2027 Targets: Laying the Foundation

The Implementation Plan specifies measurable outcomes for 2027, intended to catalyze early momentum and build foundational capabilities:

• Intelligent manufacturing maturity: Benchmark enterprises are expected to elevate their digital and intelligent manufacturing capabilities, with a noticeable improvement in systematic digital integration.
• SME digital capability uplift: Automotive parts and component suppliers, especially small and medium-sized enterprises (SMEs), are to achieve significant digitalization, addressing historical barriers to technology adoption.
• Tool adoption: Adoption of digital design tools is slated to exceed 95 percent across key production processes, ensuring consistency and efficiency.
• Process control and automation: Critical manufacturing processes should achieve a numerical control (NC) rate above 70 percent, reflecting advanced automation levels.
• Efficiency gains: The industry’s overall labor productivity is targeted to improve by at least 10 percent relative to 2025 benchmarks, while product development and delivery cycles are expected to shorten by 20 percent.
• Solution ecosystem development: The plan aims to cultivate more than 20 intelligent manufacturing systems solution providers whose offerings can be adopted and replicated throughout the sector.
• System infrastructure: Development of standards, technology supply chains, and workforce training systems tailored to digital and intelligent manufacturing.

These 2027 milestones emphasize measurable improvements in operational efficiency, technology maturity, and ecosystem readiness.

2030 Vision: Industry-Wide Integration

By 2030, the plan envisions a more profound digital transformation characterized by:

• Deep technology integration: Digital technologies are expected to be deeply integrated into business processes across design, supply, production, sales, and services.
• Coordinated development across enterprise scales: Large, medium, and small enterprises should advance collaboratively, reducing the digital divide within the industry.
• Comprehensive public digital services: Establishment of a digital public service infrastructure capable of supporting data exchange, cybersecurity, and digital compliance across the automotive value chain.
• Mature supplier ecosystem: A resilient and digitally ready supplier network that enhances overall industry responsiveness and flexibility.

The 2030 vision underscores systemic transformation rather than incremental adoption, signaling a shift toward fully digital business models.

Six Core Action Categories

Diagnosis and Improvement

The Implementation Plan calls for comprehensive diagnosis of current digital maturity levels across the sector, enabling tailored improvement strategies for different enterprise segments. This action helps identify bottlenecks and prioritize digital investments based on capability gaps and value creation potential.

SME Digital Empowerment

Recognizing that component suppliers and smaller firms often lag behind integrators in digital adoption, the plan includes targeted interventions to support SMEs’ digital upskilling, including access to cloud computing resources, digitized supply chain tools, and tailored support services. Such empowerment is intended to foster broader ecosystem uplift and avoid creating capability gaps that can stall networked operations.

Scenario Demonstration and AI Integration

The Implementation Plan identifies typical application scenarios for digital transformation across design, production, supply, sales, and service stages. These scenarios serve as demonstration cases for integrating AI, industrial internet applications, and digital twins to optimize workflows, reduce error rates, and enhance responsiveness. Deepening AI applications, from simulation and virtual testing to intelligent robotics and production planning, is critical for realizing agile smart manufacturing.

Gradient Cultivation and Matrix Construction

To promote structured adoption, the plan proposes a gradient development model that nurtures automotive firms along ascending capability tiers. This approach encourages leading firms to set benchmarks and share best practices while enabling mid-tier and smaller companies to incrementally build digital competencies. Establishing service ecosystems and solution provider matrices further supports collaborative evolution.

Standardization and Interoperability

A standardized framework for digital transformation ensures compatibility across systems, devices, and data formats. Enhancing standardization also supports cross-enterprise collaboration and mitigates integration risks, thereby fostering a more seamless supply chain environment. Emphasis on interoperability supports industrial internet platforms and 5G-enabled operations.

Technology Breakthrough and Capability Strengthening

A significant dimension of the Implementation Plan is strengthening core technologies that underpin digital transformation, including cloud infrastructure, AI analytics, industrial robotics, and secure data platforms. By aligning research and development priorities with sector needs, the plan seeks to accelerate domestic innovation and reduce reliance on imported technologies.

Implementation Considerations

Talent and Skills Development

Digital transformation requires skilled talent capable of bridging technology and business needs. The plan’s focus on coordinated training suggests an institutional commitment to workforce readiness across digital domains, including data analytics, intelligent manufacturing operations, and digital project management.

Data Governance and Security

As data becomes a core industry asset, robust governance frameworks, including standards for data interoperability, security, and privacy, are fundamental. Establishing a trustworthy data ecosystem supports digital operations and deepens stakeholder confidence in shared platforms.

What This Means for Business

The Implementation Plan for Digital Transformation of the Automotive Industry offers several implications for businesses:

1. Accelerated Digital Investment: Firms should anticipate increased capital allocation toward automation, AI, and integrated digital systems to remain competitive.
2. Supplier and SME Opportunities: Component suppliers and SMEs that embrace digital tools early may secure stronger partnerships and improved market positioning.
3. Demand for Digital Solutions Providers: The cultivation of intelligent manufacturing solution vendors will generate demand for software, consulting, and systems integration services.
4. Talent and Skills Imperative: Robust training and skills development programs are essential to support digital adoption and unlock productivity gains.
5. Ecosystem Collaboration: Enhanced data standards and interoperability frameworks promote cross-enterprise cooperation, extending beyond individual firms to broader industrial clusters.

Sources

• Implementation Plan for Digital Transformation of the Automotive Industry (汽车行业数字化转型实施方案), Ministry of Industry and Information Technology, Ministry of Education, State Administration for Market Regulation, and National Data Administration, published 30 December 2025.
  https://www.gov.cn/zhengce/202512/content_7053259.htm 

• Four ministries jointly issue the digital transformation plan for the automotive industry. (ceea500.org.cn)
• Analysis of six action categories and typical scenario integration. (digitalchina.gov.cn)
• Detailed goals and benchmarks in automotive digitalization. (finance.people.com.cn)