Kimi AI Beats GPT-5 🧠 Porsche Opens China R&D 🏎️ Starbucks Sells China Stake ☕️

2025-11-10 | subscribe | homepage

Welcome back to China Insights Weekly. Here are some of the key highlights for this week’s edition:

• China offers up to 50% power subsidies for firms using domestic AI chips to cut Nvidia reliance

• Clariant expands Daya Bay plant, boosting pharma and specialty chemical output in China

• China dominates 68% of global electrolyzer capacity, driving the green hydrogen supply chain

• USD 23 Billion Simandou mine in Guinea to give China new leverage over global iron ore prices

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🚀 Headlines

Latest version of Beijing-developed open source Kimi AI model outperforms GPT-5 and Sonnet 4.5 (link)

Moonshot, a Beijing-based AI lab, has released Kimi K2 Thinking, an open-source AI model that outperforms OpenAI's GPT-5 and Anthropic's Sonnet 4.5 on several benchmarks, including Humanity's Last Exam, BrowseComp, and Seal-0. Trained with approximately 1 trillion parameters, Kimi K2 Thinking integrates long-horizon planning, adaptive reasoning, and the use of online tools. The model, which is available on Hugging Face, cost only $4.6 million to train, a fraction of the billions spent by leading US AI labs. This development challenges the proprietary, subscription-based AI model and raises questions about the value of expensive AI tools. Some US companies, like Airbnb, are already preferring Chinese AI tools for their performance and cost-effectiveness. The release of Kimi K2 Thinking underscores the growing competitiveness of Chinese AI and its potential to disrupt the global AI market.

Porsche opens strategic China R&D center in Shanghai, Volkswagen invests 200 million USD for in-house System-on-Chip development (link, link)

Porsche has officially opened its China R&D Center in Shanghai, marking its first strategic research and development hub outside Germany. The center, located in Shanghai's Jiading District, spans 10,000 square meters and includes specialized workshops and human–machine interaction labs. The center integrates R&D, procurement, and quality control functions with independent decision-making authority, aiming to shorten development cycles significantly. Its first product, a China-specific infotainment system, is expected to debut in 2026 production models.

Volkswagen to invest over 200 million USD in China to independently design and develop System-on-Chip (SoC) technology. This move is part of Volkswagen's "In China, For China" strategy. The in-house chip development will be led by Carizon, a joint venture between Volkswagen's software company Cariad and Chinese firm Horizon Robotics. The first SoC is projected to achieve mass production within three to five years, with a computing power of 500 to 700 TOPS per chip. Initially, these chips will be integrated into Volkswagen's Chinese models equipped with L3 and above autonomous driving functions. This investment builds on Volkswagen's previous commitment to invest over 100 billion yuan (14 billion USD) in China's intelligent electric vehicle industry ecosystem, aiming to strengthen its full-stack local intelligent driving R&D capabilities and accelerate scaled mass production and commercialization.

Swiss Clariant celebrates Care Chemicals expansion at Daya Bay, strengthening its position in China (link)

Clariant has unveiled its newly expanded facilities at Daya Bay, Guangdong Province, China, marking a significant milestone in its Asian growth strategy. The CHF 80 million investment has substantially boosted Clariant's manufacturing capabilities, particularly in pharmaceutical excipients and specialty chemicals for personal and home care applications. The expansion includes a second spray tower for APIs and pharmaceutical excipients, positioning Clariant as a key supplier in China. Additionally, Clariant has expanded its Polyglykol capacity and added a reactor to its multi-purpose plant (MPP) for the production of specialty chemicals. The Daya Bay site now offers a broader chemical portfolio, including high-performance surfactants and sustainable chemistry solutions. Separately, Clariant also created a joint venture with FUHUA for novel flame retardants, with a new facility in Leshan, Sichuan Province. These strategic moves enhances Clariant's ability to collaborate closely with local customers and support China's evolving industrial needs.