Huawei has surprised China’s electric vehicle (EV) industry with a new joint venture as the US-licensed telecom equipment giant moves further into the auto business to diversify its revenue sources. .
Huawei has repeatedly downplayed suggestions that it plans to manufacture its own vehicles, describing itself as just a partner for automakers, including a current project with Ceres Group. However, the Shenzhen-based company announced Sunday night that it had signed a memorandum of cooperation with Changan Automobile, a major state-owned automaker based in the southwestern city of Chongqing.
This move marks a solid step towards establishing a smart vehicle business by Huawei.
Under the partnership, Huawei will transfer its smart car system business to a new division with investment from Changan Automobile and “integrate core technologies and resources,” the company said. [Huawei’s] Integrate smart car solutions into the new company. ”
Changan Automobile is expected to hold up to 40% of the venture, with Huawei potentially playing a leading role in the project covering “research and development, production, and sales of smart vehicle systems and components.” It seems that there is.
The planned marriage between Huawei and Changan Automobile comes as China’s EV industry is undergoing rapid changes amid fierce competition between Tesla and dozens of local brands including BYD and Li Auto. It was held in
The companies are vying for a slice of a growing market in which Huawei and Ceres’ brand Ayto currently hold a negligible share.
Huawei said it is willing to sell its stake in the joint venture with Changan Automobile to other strategic partners in the auto industry.
Richard Yu Chendong, Chairman of Huawei’s Intelligent Automotive Solutions Business, said: “We will deepen our cooperation with Changan Automobile and also work with more strategic partner automobile companies to develop new, open and win-win solutions. We will continue to explore new business models.” Company statement.
Huawei insisted on Sunday that it would not produce cars, and rotating chairman Xu Zhijun reiterated that it only wants to help automakers make better cars.
The new business is expected to cover areas such as intelligent vehicle solutions, smart cockpits, digital platforms, cloud services, and augmented reality head-up displays, among others, according to a separate statement filed by Changan Automobile with the Shenzhen Stock Exchange on Sunday. has been done.
Huawei will no longer compete in these categories after transferring technology and staff to the new division, the statement said.
Changan Automobile’s stock price rose 10% on Monday, the daily limit.
Mr. Serres also issued a statement on Sunday, saying there will be no change to the current partnership with Huawei, but welcoming Huawei’s new venture. Ceres also revealed that it has received an invitation to invest in the new division and is actively discussing potential investments and cooperation.
Huawei has high hopes for its emerging auto business, part of the company’s diversification efforts after U.S. sanctions have hampered its once-profitable smartphone division.