Chinese Automaker’s Push Into Autonomous Driving Space Prompts Fears of IP Theft

China’s BYD, the world’s largest electric vehicle manufacturer, has established a new autonomous driving unit and initiated a hiring spree.

The company knows it’s starting behind competitors like Tesla in the autonomous driving space, and has recruited thousands of software engineers already, according to Stella Li, Executive Vice President of BYD Company Limited and President of BYD Americas.

Many of BYD’s vehicles are equipped with Advanced Driver Assistance Systems (ADAS) developed by Bosch, and the company recently partnered with Nvidia and Horizon Robotics to produce more intelligent vehicles. Nvidia’s Orin autonomous driving platform is set to be used in the next-generation Dynasty and Ocean model cars, the company said.

With the new focus on in-house development of autonomous driving capabilities, longtime concerns about intellectual property theft from rival companies have cropped up.

Chinese companies no longer have to reverse-engineer physical items like cars or airplanes to recreate them, they can “simply move the data from the inventing company to the cloud and download it elsewhere with an internet connection, for example China,” said Rob DeCicco, who specializes in digital forensics investigations, electronic discovery, and cyber security.

“By the time any stolen data is detected as missing or copied, plus time for the U.S. legal system to serve a cease and desist, the benefits have been realized,” DeCicco said. “This happened in pharma for years and in other industries like high-frequency trading algorithms, where intellectual property that electronically has a high value, is easily portable, and can create value at another entity quickly."

Warren Buffet-backed BYD, which got its start manufacturing batteries and other parts for Nokia and Motorola, has long denied claims of intellectual property theft. More recently, BYD has become known for its vertical integration of supply chains, manufacturing its own chips. It has even sold its batteries to rivals.

Since opening a Los Angeles headquarters in 2011, BYD America has sold hundreds of electric buses to customers in the U.S. and Canada. The company is the world’s leading manufacturer of battery electric buses, with over 50,000 vehicles on the road globally, and more than 1,000 vehicles on the road or in production in the U.S., the company said.