The company also said it would integrate AI startup Deepseek's software into its cars, following domestic peers such as Geely, Great Wall Motors, and Leapmotor.

BYD is Tesla's biggest rival in China and increasingly abroad, and Monday evening's announcement led analysts to suggest a new price war might be on the horizon.

BYD will install its "God's Eye" autonomous driving system in at least 21 models, including the Seagull budget hatchback priced from 69,800 yuan ($9,550).

The system includes features such as remote parking and autonomous highway navigation previously found on more expensive vehicles. Tesla has similar features available in its EVs priced from $32,000.

"Autonomous driving is no longer a remote rarity, it's a... necessary tool," BYD founder Wang Chuanfu said at a livestreamed event on Monday.

Self-driving technology would become an "indispensable tool like safety belts or airbags" within a few years, he predicted.

The integration of DeepSeek, the company said, would help improve self-driving technology and provide a more personalised experience for consumers.

The AI firm made headlines last month when it unveiled a chatbot that can match its American competitors apparently at a fraction of the cost.

Shares in BYD jumped 4.5 percent to a record high in Hong Kong on Tuesday -- having already risen almost 20 percent in the days leading up to Monday's event.

China's auto market, the world's largest, has seen a prolonged price war among dozens of EV producers desperate to grab market share.

Almost 11 million electric and hybrid vehicles were sold in the country last year, up more than 40 percent from 2023.

BYD accounted for around 4.2 million of those sales, with its quarterly revenue overtaking Tesla's for the first time in the third quarter.