One by one, Chinese technology giants have announced their plans for the auto space over the past few months. Several internet companies, such as search engine provider Baidu, have decided to enlist the help of a manufactured car manufacturer to make cars. Xiaomi, which makes its own smartphones but has been under pressure for years, has also jumped into the automaking bandwagon, a light-wealth firm that makes money from software services.
Industry observers are now speculating on who will be next. Huawei naturally comes to mind. Huawei seems to be suitable for car manufacturing – at least more efficient authentic internet companies – thanks to its history of manufacturing and supply chain management, brand recognition, and huge retail network. However, the telecom equipment and smartphone maker has repeatedly denied allegations that it is launching a car brand. Instead, it says its role will be to be a Tier 1 supplier for auto manufacturers or OMEs (core equipment manufacturers). Huawei is not an artisan, Eric Xu, chair of the company’s tour, recently reiterated at the firm’s annual analyst conference in Shenzhen.
“Since 2012, I have been personally involved with the Chairman and CEO of all major OEMs in China and executives of German and Japanese automakers. During this process, I discovered that the motor industry needs Huawei. It doesn’t need the Huawei brand, but instead, we need ICT [information and communication technology] experts to help build the vehicles of the future,” said Xu, who said the strategy has not changed since it took effect in 2018.
There are three major roles in auto production: manufacturers of branded vehicles such as Audi, Honda, Tesla and soon Apple. Tier 1 companies that provide car parts and systems for manufacturers directly with established individuals such as Bosch and Continental and now Huawei; And finally, chip suppliers, including Nvidia, Intel, and NXP, whose role is increasingly important as industry players move toward highly automated vehicles. Huawei also makes in-house car chips. ” Huawei wants to be the next generation of bash,” said TechCrunch, an executive at a Chinese robotics startup, who did not want to named. Huawei’s position as a Tier 1 supplier makes it unambiguous. So far, it has secured three major customers: BAIC, Chang’an Automobile, and Guangzhou Automobile Group.
Huawei is not a carmaker. It wants to be the Bosch of China
