Reeling from strict US sanctions, Huawei plans foray into electric vehicle market
HONG KONG/BEIJING: China’s Huawei plans to make electric vehicles under its own brand and could launch some models this year, four officials said, as the world’s largest telecommunications equipment maker, battered by US sanctions, explores a strategic shift.
Huawei Technologies Co Ltd is in talks with state-owned Changan Automobile and other automakers to use their car plants to make its electric vehicles (EVs), according to two people aware of developments. Huawei is also in discussions with
Beijing-backed BAIC Group’s BluePark New Energy Technology to manufacture its EVs, said one of the two and a separate person with direct knowledge of the matter. The plan heralds a potentially major shift in direction for Huawei after nearly twoyears of US sanctions that have cut its access to key supply chains, forcing it to sell a part of its smartphone business to keep the brand alive. Huawei was placed on a trade blacklist by the Trump administration over national security concerns.
Many industry executives see little chance that blocks on the sale of billions of dollars of US technology and chips to the Chinese
company, which has denied wrongdoing, will be reversed by his successor. A Huawei spokesman denied the company plans to design EVs or produce Huawei branded vehicles. “Huawei is not a car manufacturer. However, through ICT (information and communications technology), we aim to be a digital caroriented and new-added components provider, enabling car OEMs to build better vehicles.”
Huawei has started internally designing the EVs and approaching suppliers at home, with the aim of officially launching the project as early as this year, three of the sources said. Richard Yu, head of Huawei’s consumer business group who led the company to become one of the world’s largest smartphone makers, will shift his focus to EVs, said one official.
The EVs will target a massmarket segment, another official said. All the officials declined to be named as the discussions are private. Chongqing-based Changan, which is making cars with Ford Motor Co , declined to comment.
BAIC BluePark did not respond to repeated requests for comment. Shares of Changan’s main listed company Chongqing Changan Automobile rose 8% after reported the discussions. BluePark’s shares jumped by their maximum 10% daily limit.
Chinese technology firms have been stepping up their focus on EVs in the world’s biggest market for such vehicles, as Beijing heavily promotes greener vehicles as a means of reducing chronic air pollution.
Sales of new energy vehicles (NEVs), including pure battery electric vehicles as well as plug-in hybrid and hydrogen fuel cell vehicles, are expected to make up 20% of China’s overall annual auto sales by 2025. Industry forecasts put China’s NEV sales at 1.8 million units this year, up from about 1.3 million in 2020.