China’s Huawei Technologies Co (華為) plans to make electric vehicles (EVs) under its own brand and could launch some models this year, four sources said, as the world’s largest telecommunications equipment maker, battered by US sanctions, explores a strategic shift.
Huawei is in talks with state-owned Changan Automobile (長安汽車) and other automakers to use their plants to make its electric vehicles, two of the people familiar with the matter said.
The company is also in discussions with Beijing-backed BAIC Group’s (北京汽車集團) BluePark New Energy Technology (藍谷新能源科) to manufacture its EVs, said one of the two and a separate person with direct knowledge of the matter.
The plan heralds a potentially major shift in direction for Huawei after nearly two years of US sanctions that have cut its access to key supply chains, forcing it to sell a part of its smartphone business to keep the brand alive.
Huawei was placed on a trade blacklist by former US president Donald Trump’s administration over national security concerns.
Many industry executives see little chance that blocks on the sale of billions of dollars of US technology and chips to the Chinese company, which has denied wrongdoing, would be reversed by his successor.
A Huawei spokesman denied the firm plans to design EVs or produce Huawei branded vehicles.
“Huawei is not a car manufacturer. However, through ICT [information and communications technology], we aim to be a digital car-oriented and new-added components provider, enabling car OEMs [original equipment manufacturers] to build better vehicles,” the spokesman said.
Huawei has started internally designing the EVs and approaching suppliers at home, with the aim of officially launching the project as early as this year, three of the sources said.
Richard Yu (余承東), head of Huawei’s consumer business group who led the company to become one of the world’s largest smartphone makers, is to shift his focus to EVs, one source said.
The EVs would target a mass-market segment, another source said.
All the sources declined to be named as the discussions are private. Chongqing-based Changan, which is making vehicles with Ford Motor Co , declined to comment. BAIC BluePark did not respond to repeated requests for comment.
Chinese technology firms have been stepping up their focus on EVs in the world’s biggest market for such vehicles, as Beijing heavily promotes greener vehicles as a means of reducing chronic air pollution.
Sales of new energy vehicles (NEVs), including pure battery electric vehicles, as well as plug-in hybrid and hydrogen fuel cell vehicles, are expected to make up 20 percent of China’s overall annual auto sales by 2025.
Industry forecasts put China’s NEV sales at 1.8 million units this year, up from about 1.3 million last year.
Huawei’s ambitious plans to make its own vehicles would see its join a raft of Asian tech companies that have made similar announcements in recent months, including Baidu Inc and Foxconn Technology Group (富士康科技集團).
In the US, Amazon.com Inc and Alphabet Inc are also developing auto-related technology or investing in smart-car startups.
Huawei has been developing a swathe of technologies for EVs for years, including in-vehicle software systems, sensors for automobiles and 5G communications hardware.
The company has also formed partnerships with automakers such as Daimler AG , General Motors Co and SAIC Motor to jointly develop smart auto technologies. It has accelerated hiring of engineers for auto-related technologies since 2018.
Huawei was awarded at least four patents related to EVs this week, including methods for charging between electric vehicles and for checking battery health, official Chinese patent records show.
Huawei’s push into the EV market is currently separate from a joint smart vehicle company it cofounded with Changan and EV battery maker CATL in November last year, two of the sources said.
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