Huawei aims to make automotive arm profitable by 2025

Huawei established its car-making business back in May 2019 with a view of not making its own vehicles at some point down the road. The company started with establishing a marketing department and commenced wide-ranging research into the automotive market in China and abroad.

That research clearly is paying off, in 2021 Huawei claimed it was able to make nearly $1,450 profit per every car sold in China - with 30 million of cars in the People’s Republic that’s potentially a huge scope for business.

The company started with just 70 people and now it employs over 40,000, it has nine departments with five dedicated to autonomous driving technology, smart cockpit, electric products, networking and cloud services. Huawei invested $500 million into its automotive business so far.

Huawei entered strategic partnerships with Seres, Chery, BAIC and JAC Motors where it would be responsible for the technology underpinning the cars built by the companies. It allowed Huawei to employ economies of scale when it comes to ADAS solutions and drivetrain technology with the additional outlay of actually manufacturing the vehicles. The company claims it managed to reduce the costs of intelligent driving systems down to less than $3,000 per vehicle.

AITO is one of the brands benefiting from Huawei’s input, cars developed together with BAIC will be sold at Huawei’s showrooms. Chery E03 is about to be launched and it will compete directly with Tesla Model 3 according to the company.

Huawei has become an automotive giant within just a few years without actually manufacturing a single car. The clever partnerships the company entered with some of the largest Chinese EV manufacturers gave it access to the biggest manufacturing base and the biggest industrial customers in a market that grows at an exponential rate with no signs of slowing down anytime soon.

With the first cars using Huawei technology only just entering the sales, the company is looking forward to the future. With projected EV sales in to only grow, it looks like Huawei made a good bet and became a supplier of essential kit, one that actually sells cars - because all the customers crave the latest autonomous and smart tech.

Via