Deepseek taught startups a lesson that car manufacturers learned years ago

This week, some Observers in the automotive industry have felt a crawling feeling of deja vu. Apparently out of nowhere, a Chinese company made the headlines by beating Western companies with the technology they have invented.

No, it was not byd, the 20 -year -old car manufacturer who has acquired a sudden global recognition in recent years when he has started to export low -cost electric vehicles worldwide. (Byd built more electric vehicles in 2024 than Tesla.) The Buzz of this week was on Deepseek, a Chinese startup that shocked technicians when it published an open source artificial intelligence model apparently with a fraction of financing that we have known to build to build theirs. Deepseek’s success has enabled us technological actions to slip earlier this week, and investors rushed to re -examine their bets.

In some respects, the experts say, the success of the startup follows the game book of the automotive industry. And the lesson was similar: Chinese companies can always build it better and more at a lower cost. “There is an underestimation of Chinese innovation and ingenuity,” said Ilaria Mazzocco, a senior colleague looking for Chinese policy at the non-profit center for strategic and international studies. “There is ingenuity even when there can be no access to the best technology.”

Many stories of global economic success of China’s main ones have emerged from a similar national strategy, explains Susan Helper, economist of the Western University case who studies global supply chains and manufacturing and worked on EV policy in the administration Biden. Cars, solar panels, batteries, steel: “It is essentially, decide on an industry that is critical and has put a lot of money for it for a long time,” she said. (Compare this to the American approach to cars, “where we change your mind on electric vehicles every few years.”)

In the case of cars, the Chinese government has for nearly two decades electric vehicle manufacturers, tax alternatives have been received from electric vehicle customers and has created policies that force the whole country to reduce emissions and become electric – a push in the direction of the VE. The investment in Chinese AI is much more recent, but increases. Over the past decade, the Chinese government has paid more than $ 200 billion into AI companies, Stanford researchers say. This month, he announced a new IA investment fund of $ 8.2 billion.

In addition, says Helper, Chinese industry benefits from the more vague borders between the government, private companies and the military.

The result is an AI ecosystem which is certainly not identical to that of the car, but has some echoes. The history of the Chinese automotive industry demonstrates sophisticated research networks and the capacities of companies to rely on the success of their predecessors, explains Kyle Chan, postdoctoral researcher at Princeton University who writes on industrial policy and Chinese climate. Assisting the success of Geely, who began the late 1980s as a refrigerator parts before going to cars in 1997. During his first four years, he had no license to operate in China; Today, it produces 3.3 million vehicles and is sold internationally, in addition to having major participations in Volvo, Polestar and Aston Martin. Geely and other car manufacturers who emerged at the same time – Chery, Byd, Great Wall Motor – have now produced a new wave of manufacturers. Today, around 100 national brands are sold in China.