The first AIC fund in Hubei and Shandong has invested in cockpit chips.

Beyond automotive chips, Xinqing Technology is actively expanding into areas such as embodied intelligence, low-altitude economy, and edge computing. In addition to being led by the second phase of the State-owned Enterprise Structural Adjustment Fund in this round, Xinqing Technology has also received the first investment from the AIC in Hubei and Shandong provinces.

The domestic intelligent cockpit chip market has witnessed a new investment.

On August 19th, Xinqing Technology announced the completion of a Series B financing round exceeding 1 billion RMB. It is reported that this round of financing was led by the second phase of the State-owned Enterprise Structural Adjustment Fund, with participation from multiple local state-owned industrial funds.

Moreover, journalists from the Venture Capital Daily noticed that in this round of financing, Xinqing Technology also received strategic investments from the first AIC projects in Hubei and Shandong provinces, as well as from Taiping Financial Holdings, an insurance asset management company under a central enterprise.

It is understood that beyond automotive chips, Xinqing Technology is actively exploring a second growth curve and has entered areas such as embodied intelligence, low-altitude economy, and edge computing. At this year's Shanghai International Automobile Industry Exhibition, a robot equipped with the "Longying No. 1" chip was showcased.

Developing Next-generation Cockpit Chips

Founded in 2018, Xinqing Technology focuses on high-performance automotive-grade chips and solutions. Many of its products have been applied in automakers such as Geely, FAW Hongqi, and Dongfeng. Additionally, it is one of the few domestic chip suppliers that can cover both intelligent cockpits and key SoCs for intelligent driving.

It is reported that in 2021, the company's self-developed 7-nanometer automotive-grade intelligent cockpit chip, "Longying No. 1", was applied or designated for use in dozens of mainstream models at home and abroad. In 2024, the full-scenario advanced driver-assistance system chip, "Xingchen No. 1", filled the gap in domestic intelligent driving chips with comparable computing power.

Wang Kai, the founder, director, and CEO of Xinqing Technology, previously revealed that the next-generation cockpit chips, the "Longying No. 2 Ultra" and "Longying No. 2 Lite" series, are under development.

In the field of intelligent cockpit chips, leading domestic companies also include Xinchi Technology, while foreign companies include Qualcomm, AMD, and Renesas Electronics. According to data from the Gasgoo Automotive Research Institute, Qualcomm holds a 70% market share in the domestic intelligent cockpit domain controller SoC market, essentially dominating the market.

An investor in the chip field told journalists from the Venture Capital Daily that currently, cockpit chips are transitioning from a "single computing power competition" to a comprehensive competition encompassing "process - architecture - ecosystem". The growth of the mid-range market and the rise of domestic supply chains will determine the reshuffle of the market rankings in the next three years.

Furthermore, with the acceleration of localization, companies like Xinqing Technology are gradually narrowing the gap with Qualcomm through technological breakthroughs such as 7nm process and large AI models. Data from the Gaogong Intelligent Automotive Research Institute shows that in 2024, the proportion of automakers choosing domestic chip solutions increased to 7.4%, a threefold increase compared to 2023.

First AIC Fund Projects in Hubei and Shandong

Wang Kai, the director and CEO of Xinqing Technology, graduated from the University of Electronic Science and Technology of China. He has rich experience in the semiconductor industry and has held multiple positions, including CEO of Huaxintong Semiconductor, Global Vice President of Sales and President of the Asia-Pacific Region at SanDisk, and Global Vice President of Sales and Marketing and General Manager of the Asia-Pacific Region at Freescale.

Before joining Freescale, Wang Kai worked at Broadcom in Greater China, the R & D engineering department of UTStarcom, and the broadband terminal business unit of STMicroelectronics.

Regarding the mass production of Xinqing Technology's chips, he previously mentioned that the shipment volume will exceed one million pieces in 2025, and it will account for at least 25% of the market share in the next two to three years. He also plans to apply for an IPO this year and go public next year.

Looking to the future, as the automotive market becomes more competitive, automotive chip manufacturers will go through a process from a diverse and competitive landscape to a stage of consolidation and compatibility, and finally, only 2 - 3 companies will remain. Wang Kai believes that in the future, there will be no more than three companies in either the cockpit chip or intelligent driving chip sectors.

Xinqing Technology has completed five rounds of financing to date. Investors include Sequoia Capital China, Haier Capital, Puyin International, SMIC Juyuan, and Jiayu Capital.

In addition to being led by the second phase of the State-owned Enterprise Structural Adjustment Fund in this round, Xinqing Technology has also received the first investment from the AIC in Hubei and Shandong provinces.

Among them, the Hubei AIC Fund is the Hubei Yangtze River Qianfan Qihang Equity Investment Fund, with an investment of 100 million RMB.

According to the Wuhan Jianghan District People's Government, this investment is the first AIC fund project in Hubei after the implementation of the AIC pilot policy. It brings together the state-owned capital from central, provincial, municipal, and district levels. It took only one day from the signing of the agreement to the completion of business registration and only six days to complete the first investment transfer. This capital is mainly used to accelerate the R & D and design of Xinqing Technology's intelligent cockpit chips and autonomous driving chips.

The Shandong AIC equity project for this investment can be traced back to April 2025 when Agricultural Bank of China Investment, Ronghui Group, and Xinqing Technology signed a framework agreement for fund investment. The Qingdao Ronghui Xinke Qihang Equity Investment Fund involved is the first relevant fund to complete business registration after Qingdao was approved for the AIC equity investment pilot. Its establishment aims to serve high-tech enterprises and support strategic emerging industries. Therefore, it is very likely that this first investment from Shandong AIC for Xinqing Technology is the formal capital injection by this fund as per the agreement.

The AIC fund is a typical "patient capital" that invests in early-stage, small-scale, and hard-tech companies. On September 24th last year, the National Administration of Financial Regulation expanded the scope of the equity investment pilot of financial asset investment companies from Shanghai to 18 large and medium-sized cities including Wuhan.

The aforementioned investor said that in practice, taking Xinqing Technology's receipt of the first AIC equity project in Hubei as an example, the 100 million RMB investment from the Hubei Yangtze River Qianfan Qihang Equity Investment Fund not only sets an efficient example of "registration - investment" under the AIC pilot policy but also provides crucial support for the technological R & D and industrial breakthroughs of domestic hard-tech enterprises through the injection of "patient capital".

Special statement: The content of this article is for reference only and does not constitute investment advice. Investors shall bear the risks associated with their operations based on this information.

This article is from the WeChat official account "Venture Capital Daily". Author: Li Mingming. Republished by 36Kr with permission.