In China's automotive telematics control unit (TCU) market in the first quarter of 2025, there are three sets of data that have attracted attention: the localization rate has reached 58%; China's 5G TCU shipments account for 82% of the global market; BYD's TCU sales increased by 98% year-on-year. These three figures not only highlight the rapid rise of China's automotive electronics industry, but also reveal the deep logic of China's automotive industry to reshape the global competition pattern in the era of intelligent networking.
Ⅰ Breakthrough in localization: break the pattern of international monopoly
TCU is a key component of intelligent networked vehicles, which undertakes core functions such as in-vehicle communication, remote control, OTA upgrade, and Internet of Vehicles connectivity. For a long time, the TCU market has been dominated by international giants such as Bosch, Continental, and LG Innotek. However, at present, the localization rate of TCU in China has reached 58%, indicating that domestic manufacturers are gradually getting rid of their dependence on overseas technology and grasping the industrial initiative.
Behind this progress is the joint promotion of policy, technology and market. First of all, the "new infrastructure" strategy at the national level promotes the deployment of 5G base stations and Internet of Vehicles, which has become an important soil for the popularization of TCU. Taking Beijing, Shanghai, Guangzhou and other cities as examples, the construction of vehicle-road collaborative demonstration zones has created real scenarios for TCU applications and accelerated the implementation of local technologies.
According to Counterpoint Research, in the first quarter of 2025, the sales volume of China's TCU market increased by 16% year-on-year, and the global market share reached 32%, making it the world's largest market. Although LG Electronics still ranks first with a market share of 18%, it has declined slightly from the same period last year, while domestic manufacturers, especially BYD Electronics, rely on a year-on-year growth rate of 98% to catch up, and the market structure is accelerating the reconstruction.
Image: China's TCU market: analysis of the localization rate and growth trend from Q1 2024 to Q1 2025
Ⅱ Technological advancement: local manufacturers have broken through core barriers
In recent years, local technology companies such as Huawei, ZTE, Quectel and Fibocom have made great efforts in TCU research and development, and continue to invest in China's technological leap in the field of 5G TCU. Huawei's 5G TCU module integrates cellular communications, C-V2X, GNSS, and other functions to support high-speed and low-latency in-vehicle communications, and has been widely used in autonomous vehicles. Compared with traditional 4G modules, this type of 5G TCU has greatly improved bandwidth, connection density and stability, providing a solid foundation for intelligent driving.
In addition, the domestic supply chain ecology is becoming more and more perfect, from SoC chips to module manufacturing, software platforms to system integration, the whole chain has been basically covered. On this basis, new technologies such as modular design, OTA remote upgrade, and edge computing are gradually popularized, making TCU products no longer "hardware vassals", but the core interface of software-defined vehicles.
Ⅲ Deep binding of car companies: from components to the core of intelligent experience
BYD's 98% increase in TCU sales is no accident. As a leader in the field of new energy vehicles, BYD began to develop its own TCU module as early as 2018 and deeply integrated it into the DiLink vehicle machine system, forming an intelligent closed loop of "hardware + software + ecology".
In its popular models such as "Han" and "Tang", TCU has realized a number of intelligent functions from remote starting of vehicles to OTA upgrades, and supports users to control core modules such as air conditioning, windows, and positioning through the App. This smartphone-style car experience has significantly improved user stickiness and brand value, and has also made TCU a key driver of increasing sales.
Not only BYD, but also Xpeng, Li and NIO are also accelerating the layout of TCU technology. The formation of deep binding between leading car companies and local suppliers not only improves the efficiency of product iteration, but also jointly promotes the accelerated evolution of China's TCU technology chain.
Figure: 58% + 82% + 98%! Why did China's automotive TCU market overturn the international market?
Ⅳ 82% of the world's share: China has become the "source" of 5G TCU innovation
In the global 5G TCU market, China accounts for 82% of the shipment share. Behind this data is the leading construction of 5G network infrastructure, the urgent need for intelligent upgrading of car companies, and the continuous support of policies.
At present, 5G TCUs not only assume basic communication functions, but also play a key role in high-speed autonomous driving scenarios. For example, the 5G TCU supported by V2X can realize data transmission with millisecond-level latency, enabling vehicles to perceive the surrounding environment in real time under high-speed conditions, greatly improving the safety and response efficiency of autonomous driving.
In addition, Chinese companies have begun to integrate AI algorithms with TCUs to explore functions such as edge reasoning, voice recognition, and driving behavior analysis, making TCUs gradually become "in-vehicle intelligent terminals" rather than simple communication modules.
Ⅴ Global challenges: The high-end market and brand value are still shortcomings
Despite the strong performance of Chinese TCU manufacturers in the domestic market, they still face strong challenges in the global high-end market. Traditional automotive electronics giants such as Bosch and Continental still dominate the mid-to-high-end car market in Europe and the United States with their strong brand influence, mature supply chain and reliable product quality.
Taking Bosch as an example, its TCU products support a variety of communication protocols and redundant designs, and their reliability meets AEC-Q100 Grade 0 standards, making them suitable for harsh environments.
In order to achieve a true "global breakthrough", Chinese manufacturers must increase investment in reliability, functional integration and brand trust, further establish stable cooperative relations with international OEMs, and expand overseas channels.
Ⅵ Data security: The technical and regulatory system needs to be strengthened urgently
With the rapid increase in the amount of vehicle data, user data, and road information accessed by TCU, data security issues have increasingly become the focus. As the core of information interaction, once the TCU is invaded or leaked, it will cause major hidden dangers to user privacy and vehicle control security.
At present, China has made some progress in relevant technical standards, encryption algorithms, and the use of security chips, but the overall regulatory system is not perfect. In the future, it is necessary to strengthen cross-departmental collaboration, formulate unified TCU data management specifications, and promote the commercial application of key technologies such as security modules and trusted computing platforms.
Ⅶ Future outlook: Towards software-defined and service-oriented
According to Counterpoint Research's forecast, by 2028, China's new cars will be fully equipped with TCUs, and the product form will shift from traditional communication modules to service-centric "intelligent communication hubs". This means that TCU is no longer a simple hardware, but an operating platform that carries a variety of services such as in-car entertainment, navigation, on-board payment, and intelligent driving assistance.
In this context, TCU software ecosystem capabilities will become a key competitive point. Building SDKs open to developers, providing cloud API services, and docking with third-party content platforms will be the core paths for Chinese TCU manufacturers to build barriers in the future.
Ⅷ Conclusion: Industrial Transformation Written Behind Data
58% localization, 82% of the global market share, and 98% sales growth, these three sets of data are not accidental coincidences, but the result of China's auto industry in the era of intelligence. From policy support to enterprise innovation, from infrastructure to ecological construction, China's TCU industry chain has basically taken shape.
In the face of global competition and technological changes, only continuous investment, open collaboration, and brand strengthening can enable Chinese TCU manufacturers to win a greater voice in the global smart car industry. Under the wave of "software-defined vehicles", Chinese TCU manufacturers are standing at a historic new starting point.
