February 23, 2024

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Huawei is pushing its technology into electric vehicles through cars and partnerships with automakers

Huawei is pushing its technology into electric vehicles through cars and partnerships with automakers

  • Huawei confirmed on Tuesday that it is working with at least four traditional automakers in China to develop new car brands.
  • This follows news over the weekend that Huawei will launch a joint venture with automotive technology company Changan Automobile.
  • Chinese automakers with products that “lack the technology to compete” appear to be more than happy to use Huawei products. [tech] “To fill in the blanks,” said Tu Lu, founder of Beijing-based consultancy Sino Auto Insights.

Shanghai, China – November 12, 2023 – Customers test the Luxeed S7, the first pure smart electric vehicle, at Huawei’s flagship store in Shanghai, China, November 12, 2023. (Photo by Costfoto/NurPhoto via Getty Images)

Norphoto Norphoto Getty Images

BEIJING – Chinese telecom and smartphone giant Huawei is doubling down on the sale of its technology in the competitive electric vehicle market.

The company confirmed that it does not manufacture cars. Instead, it sells technology components such as Harmony OS and driver-assistance products, or works with automakers to create new electric vehicle brands.

Huawei confirmed on Tuesday that it is working with at least four traditional automakers in China on new car brands, following news over the weekend of a joint venture with car technology firm Changan Automobile.

Changan and Huawei are already partners in the Avatr electric vehicle brand, which was created in 2018 with electric vehicle battery giant Contemporary Amperex Technology. Both the Avatr SUV and sedan sell for just over $42,000.

Huawei is also working with Chery on electric car brand Luxeed, which revealed details of its S7 sedan on Tuesday.

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Similar partnerships with BAIC Motor and JAC Motor are in the pipeline, Richard Yu, president of Huawei’s automotive and consumer businesses, said at the Luxeed launch event on Tuesday.

BAIC, whose Arcfox electric brand already uses Huawei technology, and JAC did not immediately respond to a request for comment.

Chinese automakers with products that “lack the technology to compete” appear to be more than happy to use Huawei products. [tech] “To fill in the blanks,” said Tu Lu, founder of Beijing-based consultancy Sino Auto Insights.

“It’s still too early to know how [Huawei’s] “The solution is up to par with their competitors, but they, like many other technology companies, see the opportunity and are putting their best foot forward into it,” he said.

Tencent, which runs the WeChat social media app in China, has claimed to supply car technology to BMW and some other automakers.

Chinese smartphone and home appliances company Xiaomi is planning to launch a car in the first half of next year. In late October, the company announced a new operating system called HyperOS.

Huawei’s revenue from its consumer business has halved since the United States placed the company on a blacklist that restricts it from purchasing from American suppliers. This includes licensed access to the latest versions of Google’s Android operating system.

Instead, Huawei released its own system, called Harmony OS.

In the first half of the year, Huawei’s consumer revenue reached 103.5 billion yuan (US$14.27 billion), while the company’s smart vehicle solutions – whose products include new energy vehicle technology – saw revenues of 1 billion yuan. Other automotive-related revenues are also included in other parts of the business.

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Huawei’s Yu said on Tuesday that the company is working with automakers in three ways:

  1. Acting as a supplier of components.
  2. Selling a range of automotive technology products called “Huawei Inside,” while the automaker designs the car.
  3. Greater control over the design, sales and marketing of the “Huawei Inside” car while the automaker manufactures the car.

Read more about China from CNBC Pro

In late 2021, Huawei announced the Aito brand of cars manufactured by Seres. The popularity of these vehicles, which are frequently displayed in many Huawei smartphone stores across China, has increased. The company claims that for the M5 alone, more than 120,000 units have already been delivered.

Ito will deliver about 16,000 to 18,000 units of its M7 cars in November, and more than 20,000 units next month, Yu said on Tuesday.

Companies like BYD and even startup Li Auto have captured a significant share of the growth in China’s new energy vehicle market, a category that includes hybrids and battery-powered cars. Traditional foreign automakers, such as Volkswagen and Toyota, have been slower to adapt.

This year, the penetration rate of new energy vehicles has risen to more than a third of new passenger cars sold in China, according to the China Passenger Car Association.