BEIJING, Nov. 26 (Reuters) – China’s Huawei Technologies Co., Ltd.[HWT.UL]announced on Sunday that it will transfer the core technology and resources of its Smart Car division, which has supported strong sales of numerous new cars, to a new joint venture it owns. Automaker Changan Automobile has a maximum rate of 40%.
Huawei said in a press release that the new company will be engaged in research and development, production, sales and service of intelligent automotive systems and component solutions.
“The new company…will work with partners to foster innovation and leadership in smart car technology and foster the prosperity and development of the automotive industry,” the release states.
Chongqing Changan Automobile (000625.SZ) said in a filing with the Shenzhen Stock Exchange on Sunday that the capital adequacy ratio and investment amount will be negotiated by both parties.
“The parties will jointly support the target company to become an industry leader in automotive intelligent systems and component solutions based in China,” the filing states.
At the signing ceremony in Shenzhen, Yu Chengdong, executive director and chairman of Huawei’s smart car solutions division, said the smartphone maker will work with more car companies to “seize the opportunities of electrification and intelligent transformation of the automobile industry.” said in a press release. He said.
Huawei has repeatedly said it doesn’t make cars, but only helps other automakers make better cars.
In addition to Changan, the company has existing partnerships with other companies such as Ceres Group (601127.SS). Huawei and Ceres jointly produce Aito brand cars, including the M7 model.
Huawei also builds the S7 sedan under Chinese automaker Chery Automobile and a new major manufacturer, Luxeed, which it intends to position as a competitor to Tesla’s Model S.
Huawei announced in October that it had received more than 50,000 orders for the improved M7 model in the first 25 days, and based on August data, the Aito is China’s best-selling new energy vehicle. It is expected to be among the five manufacturers.
Reporting by Laurie Chen and Beijing Newsroom. Additional reporting by Brenda Goh in Shanghai.Editing: Edmond Claman
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