According to foreign media reports, three people familiar with the matter revealed that Huawei has asked Audi and Mercedes-Benz whether it is interested in buying a small stake in its smart car software and components company. It is reported that the move is aimed at expanding the partnership of its new company.
Huawei, which has been the subject of US sanctions since 2019, hopes that the participation of foreign investors will protect its smart car business from potential geopolitical tensions, according to one of the sources.
Last month, Huawei said it would spin off its four-year-old Intelligent Vehicle Solutions (IAS) business unit, which is seeking to become a major player in software and components for smart electric vehicles. Previously, sources said the sector would be valued at between $28 billion and $35 billion.
According to two people familiar with the matter, Huawei has recently made preliminary contacts with Mercedes-Benz. Huawei is proposing Mercedes-Benz to buy a 3 to 5 percent stake in its new smart car company, one of the people said, and will negotiate a specific valuation. However, Mercedes-Benz was not interested in this because they wanted to maintain control of the software to maintain its premium brand positioning and did not want to outsource the software business to the best vendors.
It is not yet possible to determine whether Audi is interested in Huawei's proposal. However, according to two sources, Audi and Huawei are considering working together to develop autonomous driving technology for Audi, and plan to apply these technologies to cars for the Chinese market in 2025.
Mercedes-Benz declined to comment on speculation, as did Audi. Huawei did not respond to a request for comment.
Huawei's move comes as global automakers seek to partner with Chinese companies, which are leading the way in developing high-end features for consumers. Volkswagen has been working with electric car maker Xpeng Motors and autonomous driving chip designer Horizon Robotics to develop intelligent and connected electric vehicles for the Chinese market. In addition, Audi is also working with SAIC to develop electric vehicles for the Chinese market.
Yu Chengdong, head of Huawei's smart car business, said at a forum in April this year that it would be difficult for European, American and Japanese companies to choose Huawei as their main supplier of smart solutions due to US sanctions. "It's a big challenge because we've invested a huge amount of money," he said at the time. ”
While well-known EV makers such as NIO and BYD rely on self-developed software, Huawei has partnerships with smaller EV makers such as Celis Group and large traditional automakers such as Changan Automobile. Previously, Changan Automobile said that it would invest in the spin-off Huawei smart car business and hold up to 40% of the equity together with related parties.
Mr. Yu said in November that Huawei had invited Celis, Chery, JAC and BAIC to invest in its new smart car company, and hoped FAW would join as well. It is reported that Dongfeng Motor is also one of the potential investors in the company. (Gasgoo Song Mingxuan).
(Gasgoo Song Mingxuan).