- Public cloud adoption reaches 87% of sector
- Automakers ramp up AI-driven computing demand
China’s automotive public cloud infrastructure market continued to expand rapidly in the second half of 2025, with total infrastructure-as-a-service (IaaS) spending reaching 6.8 billion yuan ($995 million), led by Alibaba Cloud with a 42% share, IDC said.
According to a report released on April 29 by the data service provider, Alibaba’s cloud unit has held the top position in the segment for five consecutive years since 2021, as carmakers increasingly shift toward cloud-based infrastructure.
IDC estimates that public cloud now accounts for 87% of the automotive sector’s cloud infrastructure, a trend driven by rising demand for flexible computing and AI capabilities.
The adoption of large AI models and emerging technologies such as world models in vehicles is further accelerating that shift.
Alibaba Cloud has been positioning itself as a full-stack provider, combining cloud infrastructure with AI services centered on its Qwen models and in-house chips developed by Pingtouge.
In the smart cockpit segment, the company offers a hybrid “device-plus-cloud” architecture, with multimodal models deployed on vehicles for real-time perception and cloud-based systems supporting broader services.
Several Chinese automakers, including FAW Hongqi and GAC Group, have already integrated Qwen into their systems, while others such as Changan Automobile, Dongfeng Motor, BAIC Group, BYD, Geely, Great Wall Motor, Li Auto, SAIC Volkswagen and IM Motors have announced plans to adopt the system.
The integration allows in-car systems to handle a wider range of tasks through AI assistants.
In autonomous driving, Alibaba Cloud is combining its chips, cloud infrastructure and models into a unified stack to support training and deployment.
Chinese automakers are also extending their reliance on Alibaba Cloud overseas. Companies can deploy connected vehicle systems in new markets within about 30 days, the report said.
Carmakers including FAW Group, Chery Automobile and Li Auto are already running overseas operations on the platform, while others such as Changan Automobile, BYD, GAC Group and XPeng are expanding collaboration with Alibaba Cloud abroad.
