Changan Automobile’s shares reached their daily trading limit after announcing a joint venture with Huawei Technologies. This collaboration between a Chinese carmaker and a telecom equipment giant signals a transformative move in smart auto solutions.
Following the announcement, Changan Auto’s shares escalated by 10 percent to $2.73 (CNY19.56) per share during Shenzhen’s lunch break. Since November 23, the stock has witnessed a remarkable 20 percent increase.
Huawei leads the venture, contributing its technological prowess, assets, and personnel. Changan Auto and other entities will own up to 40 percent. Investment details and ownership ratios are pending further discussions.
The venture’s core activities span research, development, production, sales, and service of intelligent auto systems, including advanced driving solutions and digital platforms. This collaboration seeks to redefine the smart auto sector through innovation.
Speculations about Huawei spinning off its smart auto solutions unit, valued at around $35 billion (CNY250 billion), have been rife since November 23. Changan Auto emerged as the exclusive automotive company in an investment consortium.
Richard Yu, Huawei’s smart auto solutions business group chairman, stressed the need for a collaborative electrification smart open platform in China’s automotive industry. Huawei’s strategy extends beyond Changan Auto, aiming to forge synergistic partnerships for mutual success.
Huawei’s executive revealed the venture’s openness to collaborations with more carmakers. Seres Group, deeply aligned with Huawei in auto ventures, received an invitation to invest.
Huawei’s history in auto-smart solutions features partnerships with diverse carmakers. For example, Avatr Technology, a joint venture of Changan Auto and Contemporary Amperex Technology, integrates Huawei’s smart cockpit and driving functions. Similarly, Changan Auto’s new energy vehicle brand Deepal collaborates with Huawei.
Changan Auto’s 2023 performance further highlights this partnership’s potential. The company sold 2.1 million units in the year’s first 10 months, a 10.8 percent increase. Its New Energy Vehicles sales under various brands soared by 89 percent, totaling 364,081 units.
This collaboration marks a significant moment in the automotive industry, propelling it toward a future of intelligent, connected, and sustainable auto solutions. With Changan Auto and Huawei at the helm, the trajectory for smart automotive technology appears exceptionally promising.
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