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Huawei is deepening its dive into electric vehicles and seeking control of Chinese small car makers

Julie Chu

Hong Kong-China’s Huawei Technologies is in talks to manage an electric vehicle unit for a domestic small car maker, two people who are directly aware of the issue said. This move will be a strategic shift for the world’s largest telecommunications equipment manufacturer.

However, a company spokesman denied such a step.

Huawei, which was hit by US sanctions, is in talks with Chongqing Sokon to take control of the Chongqing Jinkan new energy vehicle, sources said.

The move will allow Huawei to build intelligent cars with its own nameplate, they said. Jinkang counts US EV brand Seres, formerly known as SF Motors, as a key asset.

It will also provide the first evidence that Huawei is going beyond simply offering an automated operating system. It will have an end-to-end presence in the EV business.

Huawei Seres SF5 Hybrid Electric Vehicle

Headquarters of refusal

However, a Huawei spokesman said, “Huawei does not manufacture cars,” adding that it is not trying to gain control.

Sokon did not respond to the request for comment.

Once the push to smart cars is complete, Huawei’s business focus has changed significantly after two years of U.S. sanctions blocking access to major supply chains, forcing it to sell part of its smartphone business. You won’t get it.

At the Shanghai Motor Show earlier this month, the company’s revolving chairman, Eric Shu, announced a deal with three state-owned Chinese automakers, including BAIC Group, to supply the Huawei Inside smart vehicle operating system.

Huawei’s entry into EVs begins with technology companies such as Xiaomi Corp strengthening their efforts in the world’s largest market for such vehicles.

2021 Huawei Seres SF5 Interior

Yale Chan, Managing Director of Automotive Foresight, said:

“Despite years of success and experience in the smartphone market, it will still take years to build an acceptable car brand in the EV sector.”

As part of the deal, Huawei will also buy an undecided stake in privately owned Chongqing Sokon Holdings, the largest shareholder of Shanghai-listed Sokon, one source said.

Richard Yu, head of Huawei’s consumer business group, which led Huawei to one of the world’s largest smartphone makers and recently turned its focus on EVs, said they are leading negotiations with Sokon. It was.

The telecommunications giant is set to close the deal in July, according to other sources.

Huawei Seres SF5 Hybrid Electric Platform

mass production

Huawei is also seeking control of BAIC’s BluePark New Energy Technology EV brand ArcFox, which recently launched an Alpha S model with the “Huawei Inside” system, another person with direct knowledge said.

However, they added that BAIC is more enthusiastic about having Huawei as a minority shareholder in ArcFox.

A BAIC representative referred a query to BluePark, which did not immediately respond to the request for comment.

All sources were unnamed.

In February, Reuters reported that Huawei plans to manufacture EVs under its own brand and may launch several models this year.

Sales of new energy vehicles such as pure rechargeable electric vehicles, plug-in hybrid vehicles and hydrogen fuel cell vehicles are expected to account for 20% of China’s total annual vehicle sales by 2025.

For months, Huawei has been deeply involved in the operation and manufacture of the lesser-known Sokon and its deficit Seres units.

2021 Huawei Seres SF5 hybrid electric vehicle

According to Ceres, the partnership led to the debut of Ceres’ first model, the Huawei Smart Selection SF5, at the Shanghai Motor Show, with more than 3,000 orders received within two days of its pre-sale last week.

Huawei sells SF5 cars in stores throughout China, including the online store VMall.com.

The company aims to launch the first intelligent car under its own brand for mass production by the end of this year, the company said.

Huawei has high expectations for models under development based on the Ceres SF5, but Sokong’s supply chain is struggling to meet those expectations, he said.

“The supply chain of the automotive industry is very long and complex,” he said. “Huawei has strengths in software and platforms, but the idea cannot be realized without solid technological improvements in the supply chain.”

Huawei Seres SF5 Interior

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Huawei is deepening its dive into electric vehicles and seeking control of Chinese small car makers

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