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Alibaba steps up AI adoption in auto industry with Nio, BMW deals

The Nio collaboration reflects the progress Alibaba has made in commercialising AI technologies in the car industry

Published: 8:00pm, 14 Apr 2025

Alibaba Group Holding is stepping up the commercialisation of its artificial intelligence (AI) technologies in the automotive industry, with new deals and reported cooperation with several major players in the industry.

Chinese electric vehicle (EV) maker Nio will use the Hangzhou-based company’s Qwen large language models (LLMs) to enable AI functions in Nio’s smart cockpit, including facilitating AI-powered conversations, according to a statement from Alibaba last week. Alibaba owns the South China Morning Post.

On the production side, Nio’s cockpit department is also exploring how to use Tongyi Lingma, Alibaba’s AI programming tool, to help improve its efficiency in research and development.

The Nio collaboration, which comes after Alibaba expanded its strategic partnership with the BMW Group on LLM adoption, and is reportedly in talks with Tesla for potential cooperation, reflects the progress the tech giant has made in commercialising AI technologies in the car industry.

Customers look at cars at a Tesla experience store in Shanghai on March 14, 2025. Photo: CFOTO/Future Publishing via Getty Images

Last month, Alibaba announced that it was working with BMW to accelerate the integration of the Qwen models into the German automaker’s Neue Klasse intelligent vehicles, in a deal which Alibaba said “marks a significant step forward in AI-driven mobility”.

The two companies have co-developed an AI engine based on the Yan AI, a Qwen-empowered smart cockpit AI solution developed by Banma, Alibaba’s intelligent cockpit solution provider, according to Alibaba.

The company is also talking to Tesla for potential cooperation as the US company is trying to bring its full self-driving (FSD) service to China, according to Chinese media reports in March. Alibaba did not comment on the reported talks.

The efforts to bring its AI technologies to the auto industry are part of the company’s ambitious AI blueprint, which will see it pivot to become China’s key AI enabler.

In February, Alibaba committed 380 billion yuan (US$52.4 billion) in capital expenditure for computing resources and AI infrastructure over the next three years. It represented the largest allocation of capital from a private Chinese company for a computing project. The planned outlay exceeds Alibaba’s total spending on AI infrastructure over the past decade and matches half of the initial US$100 billion investment in the Stargate AI plan promoted by the US.

Jack Ma, founder of Alibaba, delivered a rare speech to the company’s cloud unit last week, in which the 60-year-old shared his vision for a responsible and human-oriented AI, saying that “the purpose of technology is to help people live better”.

Separately, Alibaba-related companies are also ramping up their efforts in the field of new energy vehicles.

Ant Group, the fintech giant affiliated with Alibaba, last week landed a deal with the world’s largest EV battery maker Contemporary Amperex Technology (CATL) and Alibaba-backed bike-sharing company Hello to collaborate in areas including intelligent driving and new-energy battery services, Ant announced on Monday.