Xpeng, the Chinese electric vehicle start-up often cast as a key rival to Tesla, has set an ambitious goal to surpass the US carmaker’s self-driving capabilities in China by August, according to co-founder, chairman and CEO He Xiaopeng.

The target highlights an intensifying technology race in the world’s largest car market, where manufacturers are increasingly leaning on advanced software to drive growth as government subsidies are phased out.

Although Tesla’s full version of its Full Self-Driving (FSD) system has yet to be approved for use in China, making direct comparisons difficult, He said Xpeng’s Vision Language Action (VLA) system already outperformed the US company in certain complex driving scenarios.

“We’ve set ourselves a goal: to fully outperform Tesla’s FSD in the Chinese market by August,” He said at a media briefing on Friday during Auto China 2026, the 10-day Beijing International Automotive Exhibition, which runs through May 3.

“China’s driving environment is more complex. If we can surpass it here, our overall capability should be stronger.”

As the only major foreign player in China’s fast-moving electric vehicle market, Tesla has become a benchmark – and a target – for domestic rivals competing on both technology and scale.

Chinese carmakers have increasingly shifted their focus towards innovation and in-house development after regulators urged the industry to move beyond a margin-eroding price war.