Huawei’s next step: Become the Tesla of China?

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Huawei’s next step: Becoming the Tesla of China?
Image: YouTube | Huawei

Earlier this month, Huawei lost access to the technology that had enabled it to dominate the global smartphone industry. The Chinese conglomerate is now pivoting to other sectors to maintain its status as a billion-dollar enterprise.

A new report indicates the firm wants to become a Tesla-like innovator within the Chinese automobile industry.

Huawei’s Long-Term Interest in the Automotive Industry

Although Huawei is best known for selling handsets and telecom base station gear, the conglomerate has various business interests. In 2013, it launched a new department dedicated to developing connected automobile products.

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While a strange move on the surface, the company is a leading researcher and vendor of 5G components. Given the technology potential to facilitate full autonomous vehicle operation, Huawei’s smart car development efforts make sense. That said, the company has not gone all-in to vehicle manufacturing. Thus far, the firm has limited its efforts to producing cloud services, advanced cockpits, and self-driving platforms for smart cars.

Even so, the conglomerate’s automotive division has become a dependable revenue generator because of its appealing offerings.

Currently, Huawei has business deals to develop new vehicle-related 5G applications with 18 Chinese automakers. In addition, the company’s HiCar service, an internet-enabled infotainment platform akin to Apple’s CarPlay, is installed on more than 200 automobile models.

By next year, Huawei’s smart cockpit product will be available in over 500 vehicle lines.

In the past, the firm viewed its automotive interests as a non-essential part of its business. But with the future of its mobile device segment now in doubt, the corporation has come to appreciate the potential of the automotive sector. Tesla’s metric rise within the field has also seemingly convinced the conglomerate to move beyond being a third-part automotive component vendor.

Huawei’s Smart Car Plans

In January 2019, Huawei founder Ren Zhengfei publically stated his company would “never build cars.”

At the time, the executive indicated his strategy involved expanding the firm’s core business and avoiding areas where it cannot be competitive. Nevertheless, the corporation’s recent moves indicate “never” may have become “possibly” given its recent challenges.

Last year, Xu Zhijun, Huawei’s rotating chairman, noted Tesla’s technology-centric approach to the automobile industry made it the sector’s future. He also mentioned his company possessed the resources to equal the world’s most valuable carmaker.

Since then, the conglomerate deepened its ties with BAIC BluePark New Energy Technology Co. Ltd, the electric vehicle (EV) segment of leading Chinese automobile titan BAIC Group.

The two companies collaborated on a new smart car project codenamed N61. The EV features a self-driving chipset and program, three lidar systems, 12 ultrasonic radar devices, 13 cameras, and six millimeter-wave sensors made by the telecom. Caixin claims Huawei’s smart car stack is more advanced than the one powering Tesla’s Model 3 sedan.

The publication also notes the N61 will begin road tests this year before a planned launch in Q4 2021.

On the one hand, Huawei risks damaging its reputation if it releases a connected EV that falls short of consumer expectations. But on the other, the firm badly needs a new market to pursue if it is to continue growing. If the conglomerate helps introduce full self-driving passenger vehicles to the world, its next step will be clear.

Within a decade, Huawei could become as dominant a player in the auto industry as it is in the mobile device sector.

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