WeRide’s Stock Soars Amid Nvidia’s Endorsement
Recently, WeRide experienced the biggest stock price fluctuation since its listing, with a surge that triggered a circuit breaker. The primary reason for this spike was Nvidia’s announcement of its shareholding in WeRide. During U.S. trading on February 18, WeRide’s stock soared by more than 31%. Despite continuous positive developments, the autonomous driving industry has yet to experience its own “DeepSeek moment.”
Significant capital investment remains inevitable, while large-scale commercialization is still limited. Many companies in the sector are facing challenges, with reports of layoffs and shutdowns. Even leading manufacturers like WeRide and Pony.ai have not yet turned a profit. Industry experts predict that large-scale commercialization of autonomous driving will take approximately three years.
Nvidia’s Strategic Investment
As of February 18, WeRide’s pre-market share price had risen by more than 28%. On the previous trading day, WeRide’s stock initially surged by 140%, triggering a circuit breaker before closing up 83.46% at $31.5 per share—a record high since the company’s IPO. This brought its market value to $8.647 billion.
The stock price surge was driven by Nvidia’s disclosure of its 13F holdings document for Q4 2024, revealing its ownership of 1.7386 million shares of WeRide under the category of “SPONSORED ADS.” On the same day, Nvidia’s stock rose by 2.63% to $138.85 per share, pushing its market value to $3.4 trillion.
Zhang Xiang, a researcher at the Automotive Industry Innovation Research Center of the North China University of Technology, noted that Nvidia likely believes the autonomous driving market is approaching an explosive growth period. By publicly disclosing its stake in WeRide, Nvidia attracts investor attention, potentially driving up WeRide’s stock price and market value. Since Nvidia holds shares in WeRide, it benefits directly from the rising stock price. Moreover, as a chip manufacturer, Nvidia’s diverse investments in fields such as autonomous driving highlight its risk management strategy.
Morgan Stanley, however, cautioned against overinterpreting Nvidia’s investment in WeRide, noting that the investment was made before WeRide’s IPO and was relatively small. Still, the sharp reaction to WeRide’s stock suggests strong investor enthusiasm for autonomous driving technology.
WeRide’s Global Expansion and Challenges
Founded in 2017, WeRide is the only autonomous driving technology company with licenses in China, the United Arab Emirates, Singapore, and the United States. It operates in 30 cities across nine countries. In October 2024, WeRide was officially listed on the Nasdaq Securities Exchange. Since then, its stock price has more than doubled.
WeRide has been expanding aggressively in both domestic and international markets. In China, it partnered with Guangzhou Bus Group to launch the Guangzhou BRT Tianhe self-driving minibus line—the first of its kind in China’s central urban area and the first BRT self-driving bus line to operate at night in a major city. Internationally, in January 2025, WeRide collaborated with Zurich Airport in Switzerland to launch test operations of self-driving minibuses—the first commercial airport autonomous minibus project in Europe.
However, challenges remain. U.S. restrictions on chip exports to China could impact Nvidia, and if WeRide depends on Nvidia’s products for its domestic market, future developments may be affected.
The Struggles of the Autonomous Driving Industry
The autonomous driving industry faces challenges similar to those in AI. While both fields have significant potential, the reality is less optimistic due to high initial investment costs. Unlike the AI industry, where DeepSeek has emerged as an example of cost reduction, the intelligent driving sector has yet to achieve similar breakthroughs.
Despite WeRide’s transition to a lighter asset model, it has not yet reversed its financial losses. In Q3 2024, the company generated revenue of 70.01 million yuan, a 5.7% decrease from the previous year. Its net loss increased by 23.1% to 1.043 billion yuan, with an adjusted net loss of 240 million yuan.
Pony.ai is facing similar financial struggles, with accumulated losses of $367 million over the past three years (2022 to Q3 2024). Even though both companies went public last year and secured new financing channels, smaller players are struggling. In November 2024, reports surfaced about Momenta initiating layoffs, while ZongMu Technology shut down operations, with its Shanghai headquarters reportedly disconnected from power and closed.
Zhang Xiang explained that the main challenges in autonomous driving include the high costs of technology upgrades and R&D investments, while market demand remains limited. Many companies struggle to secure sufficient project support, leading to continuous losses. Large-scale commercialization is seen as the key to profitability, but achieving fully autonomous driving remains a technological hurdle.
When Will Autonomous Driving Become Profitable?
Industry analysts estimate that it will take about three years for large-scale commercialization of autonomous driving. Once this happens, companies like WeRide could secure more orders and significantly increase their revenue.
Interestingly, while many autonomous driving companies are struggling, some related firms are seeing success. On February 17, Black Sesame Intelligence announced that it expects 2024 revenue between 450 million and 500 million yuan—an increase of 44% to 60% compared to 2023. The company also projected a net profit of at least 100 million yuan, marking a turnaround from its 2023 loss of 4.855 billion yuan.
Zhang Xiang pointed out that Black Sesame Intelligence focuses on autonomous driving chips, a sector with strong demand and fewer competitors, creating a favorable market environment. Additionally, China’s push for domestic chip production has provided growth opportunities. In contrast, the autonomous driving solutions market remains highly competitive, making profitability more challenging.
Conclusion
Nvidia’s investment has undoubtedly boosted WeRide’s stock price and drawn significant investor interest in autonomous driving. However, the industry still faces considerable challenges, including high costs, limited commercialization, and intense competition. While some industry players are beginning to turn a profit, full-scale profitability for autonomous driving companies may still take years. Whether WeRide and others can navigate these challenges successfully will depend on technological breakthroughs and the expansion of the autonomous driving market in the coming years.
