Yangtze River Delta Discussion Hall · Weekly Report | What’s Next in the “4-Hour Industry Circle” for New Energy Vehicles

Recently, actions in the new energy vehicle sector have been frequent. On March 17, the Ministry of Industry and Information Technology, the National Development and Reform Commission, and the State Administration for Market Regulation jointly held a symposium with new energy vehicle companies, clearly requiring the regulation of competition order and accelerating the filling of core shortfalls such as automotive chips and basic software; the next day, the 7th Software-Defined Vehicle Forum was held in Jiading, Shanghai, with topics like vehicle cloud computing and intelligent driving middleware becoming industry focal points. Behind these intensive policy signals, a clear industry inflection point is emerging: the focus of competition in new energy vehicles is shifting from the first half’s “capacity competition and more car production” to the second half’s “high-level capability competition and organizational collaboration.” The key battleground for this contest is the Yangtze River Delta.

According to publicly available data from Shanghai, Jiangsu, Zhejiang, and Anhui, as well as industry statistics, by 2025, the total output of new energy vehicles in these four provinces and one city will be approximately 5.91 million units, accounting for about 35.5% of the national total. In other words, one out of every three new energy vehicles produced nationwide will come from the Yangtze River Delta. (Anhui; Zhejiang; Jiangsu; Shanghai) Over the past two decades, the “4-hour industrial circle” of “Shanghai R&D + Jiangsu batteries + Zhejiang lightweighting + Anhui complete vehicles” has gradually taken shape, driving the Yangtze River Delta to lead in scale advantages in the new energy vehicle industry. Currently, the real challenge is no longer whether there is an industrial chain, but whether this chain can evolve from geographic clustering to high-level institutional collaboration, and thus become a truly “world-class industrial cluster.”

All charts and figures in this article are produced by Ye Xuanyi.

“The 4-hour industrial circle” has formed, but collaboration is not yet in place

The confidence of the Yangtze River Delta’s new energy vehicle industry lies in its dense “4-hour industrial circle.” Here, Shanghai provides the “brain” composed of chips and software, about 200 kilometers west in Changzhou, Jiangsu, supplies the “heart” of power batteries, and to the south, Ningbo, Zhejiang, handles integrated die-casting “body” components. Take Tesla’s Shanghai Gigafactory as an example: its local component localization rate has exceeded 95%, with core processes basically solvable within a 4-hour drive. This physical proximity creates extremely high response and collaboration efficiency, making the Yangtze River Delta the most complete and benchmarked region for the national new energy vehicle supply chain.

Dissecting this map, the three provinces and one city have already accumulated distinctive industry characteristics driven by the market. Shanghai is accelerating into high-end segments like autonomous driving and chips, playing the role of regional “brain” and “testbed.” Jiangsu is the most stable manufacturing ballast, with Changzhou’s power battery supply chain reaching 97% completeness, and Suzhou fully weaving the “three electric” supporting network. Anhui, with a projected output of 1.7941 million new energy vehicles in 2025, leads the country, honing vehicle integration and “chain leader” traction; Zhejiang has built key hubs in intelligent connected vehicle applications and export trade.

However, it must also be recognized that the “4-hour industrial circle” primarily signifies physical collaboration. It addresses how quickly parts can reach vehicle plants and how smoothly manufacturing capabilities can connect, but does not inherently equate to higher-level industry collaboration. As competition in new energy vehicles enters the second half, the decisive variables are shifting from “can produce and produce quickly” to “are chips strong, is software good, is data communication smooth, are rules compliant.” As the sector heats up, almost every place wants to hold control over complete vehicles, batteries, chips, software, and export channels. Without clearer division of functions and higher-level collaborative rules, the original complementary advantages risk devolving into homogeneous competition where “you have it, I want it too.”

The shortcoming is not in production volume but in higher-level collaboration capabilities

The “4-hour industrial circle” has enabled the Yangtze River Delta to race ahead in the first half of the new energy vehicle industry, achieving speed and scale. But the further into the second half, the clearer a reality becomes: physical proximity does not automatically mean high-level collaboration. When competition shifts from “can produce” to “produce with precision, compute faster, iterate more quickly,” the region urgently needs to enhance several higher-level collaborative capabilities.

First, sharing of advanced common technologies remains inefficient, and data and computing resources have yet to form a true regional foundation. Currently, China’s self-sufficiency rate for automotive chips is still below 10%. Meanwhile, a single vehicle in intelligent cars uses over 1,000 chips, and L4 autonomous vehicles use more than 3,000 chips per vehicle. The key issue is not the lack of layout in the Yangtze River Delta but that these high-threshold capabilities are not sufficiently “connected.” Shanghai has proposed building an autonomous driving digital twin training ground and improving autonomous driving data monitoring platforms; Suzhou has clarified plans to promote intelligent computing platforms and data resource pools; Wuxi has already established the Yangtze River Delta National Technology Innovation Center’s automotive-grade chip pilot service platform. These platforms are filling gaps, but overall, they are still city-centric, and a public base accessible to all Yangtze River Delta automakers at low cost is still a work in progress.

Second, institutional coordination for cross-regional road rights and outbound logistics still lags behind the actual flow of the industry chain. Last December, the intelligent connected vehicle testing scenarios between Jiading in Shanghai and Taicang and Kunshan in Suzhou achieved interconnectivity, opening autonomous driving test roads between these areas. Before that, whether driving across districts within Shanghai or crossing provinces to neighboring cities, intelligent connected vehicles could not realize cross-regional passage. This indicates that although the Yangtze River Delta has a dense supporting infrastructure and close cooperation foundation, entering the autonomous driving stage still faces difficulties in test licenses, road access, data interfaces, and operational rules aligning with industry needs. Similar bottlenecks exist in outbound logistics. For example, the “Wuhu-Shanghai” premium export route for new energy vehicles, launched last December, compressed transit time from 5-6 days to 2.5-3 days through cross-province coordination, reduced the number of customs declaration steps from up to six to three, saving at least 2,000 yuan per container. However, such breakthroughs are still mostly point solutions rather than a normalized, region-wide shared mechanism.

Third, supply chain ecosystem governance remains fragile, and “accounts payable issues” are propagating into regional supporting networks. Data shows that the profit margin of China’s automotive industry in 2025 is only 4.1%, at a historic low. For the Yangtze River Delta, this is especially concerning because its industry advantage relies not only on automakers and leading enterprises but also on the highly specialized division of labor among nearly 10,000 companies across the three provinces and one city. If price wars, delayed payments, and settlement risks propagate downward and there is no unified commercial credit environment or settlement rules, the pressure will not only hit individual companies but could threaten the entire cross-regional supply chain.

The Yangtze River Delta needs to upgrade the “4-hour industrial circle” into a “full-chain collaboration network”

To truly establish a world-class cluster in the Yangtze River Delta’s new energy vehicle industry, localities must first stop blindly competing for projects and expanding capacity. Instead, they should aim to transform the geographic radius of the “4-hour industrial circle” into an unbreakable “institutional radius,” turning spontaneous physical collaboration into rules-based, high-level cooperation.

First, reinforce “strengths within each other,” avoiding internal competition. The Yangtze River Delta does not need every city to build a closed “full industry chain ecosystem,” but should extend its strengths. Shanghai should focus on advancing automotive-grade chips, foundational software, and autonomous driving rules, strengthening its “brain” functions; Changzhou and Suzhou in Jiangsu should consolidate their power battery and component pilot production, solidifying their “manufacturing foundation”; Zhejiang should connect its smart cockpit ecosystem with its strong port throughput capacity to become a key “outbound hub”; Anhui’s Hefei and Wuhu should leverage their role as chain leaders and their large-scale assembly advantages to expand capacity.

Second, jointly build high-level service platforms to break down innovation resource barriers. In the era of “software-defined vehicles” with high thresholds, the Yangtze River Delta must collaboratively establish cross-regional common technology bases. For example, chip testing and certification should not be confined to one city; instead, a “single certification, mutual recognition across regions” mechanism should be established, turning high testing costs into shared industry public goods. In autonomous driving, successful experiences like the interconnection of test roads between Jiading and Taicang and Kunshan should be extended to core smart driving cities like Hefei and Ningbo, promoting unified rules for road rights and data interfaces, and aggregating fragmented test data across administrative boundaries into large model training data pools.

Third, improve the credit foundation of the supply chain to build resilient industry ecosystems. Relying on the Yangtze River Delta’s integrated governance, explore establishing cross-regional automotive supply chain finance and supervision platforms to provide accounts payable protection and low-cost financing channels for small and medium-sized parts companies across Jiangsu, Zhejiang, and Anhui. Additionally, fully promote mature experiences like “one-order outbound logistics” and cross-province “financial and tax sharing” cooperation, using real institutional benefits to eliminate territorial concerns.

The “4-hour industrial circle” is a fruitful outcome of the Yangtze River Delta’s new energy vehicle development, demonstrating that geographic proximity can create optimal supporting efficiency. What remains to be tested next is the enormous potential of institutional collaboration. Shanghai’s “brain,” Jiangsu’s “body,” Zhejiang’s “wings,” and Anhui’s “strength” need to be tightly integrated through cross-regional data, shared rules, and credit foundations, pushing this industry belt, which accounts for over 30% of the country’s new energy vehicle output, from “clustered with a chain” to “clustered into groups.”

Yangtze River Delta

Yangtze River Delta Low-Altitude Economy Supply and Demand Matching Platform Officially Launched

On March 25, the first Yangtze River Delta Low-Altitude Economy Industry, Technology, and Finance Conference was held in Shanghai, launching a demand and supply solicitation for electronic products in the low-altitude economy industry. The Yangtze River Delta gathers about 50% of the country’s eVTOL innovation companies and has formed a development pattern of “R&D innovation in Shanghai, supporting manufacturing in surrounding areas, and full-region application scenarios.” The demand and supply list will precisely connect electronic manufacturing technology with low-altitude economy application scenarios, addressing industry chain bottlenecks. (Source: Shangguan News)

Shanghai

First China International Fair for Investment and Trade Opens in Shanghai, Building a Global Integrated Service System

On March 26, the first China International Fair for Investment and Trade opened in the Shanghai Oriental Hub International Business Cooperation Zone. By the end of 2025, China will have established over 50k overseas enterprises. Experts believe that China’s outward investment is shifting from single product exports to brand and industrial ecosystem exports, and it is necessary to improve the overseas integrated service system, especially enhancing professional services. As China’s “launch pad” for outbound investment, Shanghai is building an ecosystem of outbound enterprise services. (Source: Shangguan News)

6G Future Industry Cultivation Zone Launched in Songjiang

On March 26, the 6G Future Industry Cultivation Zone in Shanghai was launched in Songjiang District’s 6G Communication Valley, adopting a “core carrier + industry leading + linkage development” phased layout strategy, with about 1 square kilometer of pilot zone centered on Sijing Town. The event also launched Shanghai’s 6G concept verification platform and industrial verification pilot platform, bridging the gap from laboratory to market for cutting-edge 6G technologies. (Source: Shangguan News)

Jiangsu

Multiple Headquarters Projects Concentrate in Nanjing’s Main Urban Area

Amid limited land space, Nanjing’s main urban districts are transforming from “core manufacturing” to “value dispatch hub” by leveraging headquarters economy. Since this year, projects like Silic Mountain Technology, Kawangka Jiangsu Headquarters, and JD Miao Song Pharmacy Nanjing Chain Headquarters have settled in various districts. Gulou District contributes nearly 12% of the city’s total economy with less than 1% of land, and Xuanwu District’s Sumeida Group has incubated six municipal-level functional headquarters. (Source: Nanjing Daily)

Suzhou Breaks Ground on the Country’s First 8-Inch Silicon Photonics Chip Line

On March 24, Suzhou Xingyao Photonics Technology Co., Ltd. officially started construction of its silicon photonics platform project. The project plans to invest 1.2 billion yuan to build the country’s first 8-inch mass production line dedicated to silicon-based photonic chips, expected to be operational by the end of this year. This aims to establish an independent, controllable silicon photonic integrated chip manufacturing ecosystem, addressing urgent domestic needs for silicon photonics technology and insufficient mass production platforms. (Source: Suzhou Municipal Government)

Zhejiang

59 Projects in Xiaoshan Selected for the Province’s “Thousand Projects and Trillion Yuan” Program

Recently, Zhejiang Province announced its first batch of “Thousand Projects and Trillion Yuan” major construction projects for 2026, with 59 projects in Xiaoshan District selected, the highest number in the province. Among these, 43 are in industry and technological innovation, covering key fields like humanoid robots, aerospace, and visual intelligence, including projects like Zhaofeng Intelligent Humanoid Robot Ball Screw Construction and Longcheng International Aircraft Remanufacturing Center. (Source: Xiaoshan Net)

Huigou Business Alliance 2026 Ecological Industry Upgrade Conference Held in Hangzhou

On March 26, the “Huigou Business Alliance 2026 Ecological Industry Upgrade Conference” was held in Hangzhou, themed “Digital Intelligence Driven, Compliant and Far-reaching, Whole-region Empowerment.” The conference focused on digital empowerment of physical retail under the new retail 4.0 paradigm and full-industry chain ecological layout. Multiple cooperation projects such as Huigou Fast Charging, Huigou Short Drama, and Huigou One Mu Participation were announced, providing light entrepreneurial opportunities through resource integration and platform operation. (Source: Hangzhou News)

Anhui

Shiya Technology Listed, Boosts Silicon-Based OLED Micro-Display Industry

On March 25, Shiya Technology Co., Ltd. was listed on the STAR Market of the Shanghai Stock Exchange, becoming Anhui’s first listed company in 2026. Founded in 2016 in Hefei New Station High-tech Zone, Shiya Technology is a leading provider of silicon-based OLED micro-display solutions worldwide, with core products used in AI glasses, drone goggles, and other fields. The IPO funds will be used to expand the ultra-high-resolution silicon-based OLED micro-display production line. (Source: Da Wan News)

Tongling Nonferrous Metal’s Green Intelligent Copper-Based New Material Project Begins Production

On March 26, Tongling Nonferrous Metal’s green intelligent copper-based new material project held a commissioning ceremony. The project aims at high-end, intelligent, and green directions, with an annual capacity of 500k tons of high-end copper materials, utilizing the industry’s most advanced manufacturing technology to create an “intelligent factory” with “one smart center, one industrial internet platform, and N smart applications.” After commissioning, the project is expected to increase per-ton copper investment and physical labor productivity by 30%, with unit product energy efficiency reaching international advanced levels, further consolidating Tongling Nonferrous’s full industry chain advantages. (Source: Anhui State-owned Enterprise Network)

(Author Lei Qiaosen is a master’s student at the School of Geographic Sciences, East China Normal University.)

The “Yangtze River Delta Policy Forum” column is jointly initiated by the Key Research Base of Humanities and Social Sciences of the Ministry of Education, East China Normal University’s China Modern Urban Research Center, the Shanghai Social Science Innovation Base Yangtze River Delta Regional Integration Research Center, and The Paper Institute. It interprets the latest policies on Yangtze River Delta integration, provides frontline research reports, and offers pragmatic policy suggestions.

Source: Lei Qiaosen