Reported by Pulsestacks on March 17, 2024, from March 15th to 17th, the China Electric Vehicle Hundred People's Forum (2024) was held at the Diaoyutai State Guesthouse in Beijing. The forum, themed "Consolidating and Expanding the Advantage of New Energy Vehicle Development," extensively discussed topics including the new global trends in the automotive industry, the new path of green and low-carbon transformation in the automotive industry, the new direction of intelligent connected vehicles, the new strategies for the integrated development of automotive cities, innovation in the power battery industry, and the application of technologies such as big computing power, big models, and big data, as well as the construction of charging infrastructure and new changes in the automotive market and consumer behavior.
On March 16th, Yu Chengdong, Executive Director and CEO of Huawei's Consumer Business Group, and Chairman of the Intelligent Automotive Solutions Business Unit, stated, "The vehicle we collaborated on with Chery is the Smart World S7. Due to chip shortages and factory relocation, the listing and mass production were delayed. From the transition construction of the new factory to the recent shortage of chip supply, it has affected the sales of this product, but we can return to normalcy starting from April."
He mentioned that Huawei's intelligent driving system has high costs due to supply chain constraints and sanctions. "It's a bit challenging for vehicles priced below 300,000 RMB. Only when priced above 300,000 RMB can our system achieve profitability."
Yu Chengdong predicts that Huawei's Car Business Unit will turn losses into profits this year. "The significant sales of high-end models we've built with partners can achieve profitability. In the first three months, the Wisdom Select Car achieved profitability, and our Car Business Unit is close to breaking even. We expect to turn losses into profits from April onwards and achieve a positive development trend."
Dear Chairman Wan, Minister Miao, Minister Shan, Chairman Qingtai, esteemed leaders, and experts,
Good afternoon, everyone! The topic of my presentation is "Forging Hardcore Technological Solutions for Smart Cars to Boost the Advantages of China's New Energy Vehicle Industry Expansion."
As the automotive industry progresses, especially towards electrification and intelligence, we consider it a new upgrade that combines technology, consumerism, and manufacturing attributes. Even in the traditional manufacturing domain of automotive production, adopting new technologies such as integrated die casting and new domain-controlled electronic-electrical architectures can significantly shorten the distance of vehicle cables. Yet, automobiles remain consumer goods, requiring attributes of consumerism and a focus on product definition and user experience. Not to mention, the technological aspect, particularly the changes brought by the era of intelligence, electrification, intelligence, and the technological attributes brought by software-defined vehicles. Therefore, it can be said that this era has witnessed significant changes, requiring technologies such as chips, software, algorithms, AI, cloud, and various new energy technologies. We hope that Huawei can assist in the transformation and upgrading of the industry.
Leveraging our accumulated technological expertise in the ICT field for over 30 years, Huawei aims to assist the automotive industry in building independently controllable core technologies, ranging from chips, operating systems to algorithms, cloud, and AI in various domains. Therefore, our goal is to create intelligent cockpits, utilizing our HarmonyOS operating system to create intelligence, from chips to overall solutions, to achieve a human-vehicle interconnected operating system and build a HarmonyOS ecosystem for intelligent cockpits. In the field of intelligent driving, like our intelligent driving solutions, as mentioned earlier by Mr. He Xiaopeng, while Xpeng has been leading in intelligent parking and intelligent driving domestically, with our ADS advanced intelligent driving, we aim to rewrite the narrative. Our cockpit and intelligent driving experiences are widely recognized, and user experience and reviews are crucial in this industry. Healthy competition is beneficial, promoting collective development, progress, and mutual learning.
We bring a significant difference in the field of intelligent driving - proactive safety. Transitioning from the passive safety of the past, today we move towards an era of proactive safety. Intelligent driving not only significantly reduces driver fatigue but also dramatically reduces traffic accidents, enhancing human driving safety. Having an intelligent robot behind human drivers can substantially reduce traffic accidents, which is crucial. Additionally, in Huawei's intelligent electric field, as presented by Mr. Hou Jinlong earlier today, besides our well-known 600 kW ultra-fast charging stations, 800V high-voltage silicon carbide electric drive systems, batteries, and battery management systems (BMS), which better safeguard safety, our accumulated capabilities in BMS management have resulted in zero combustion incidents for our partner vehicles so far. Even in a recent accident where a vehicle hit a metal block, puncturing the chassis and battery pack, there was smoke but no combustion, maintaining our record of zero combustion incidents to date, demonstrating how technological accumulation enhances safety.
In the field of intelligent in-car lighting, our recently released AR-HUD and intelligent projection headlights are well-received by consumers, showcasing how we apply Huawei's accumulated technological expertise in the field of optics to the automotive sector.
In the vehicle control domain, through products like the Intelligent World S7 and Inquire World M9, transitioning from domain control to intelligent software-defined vehicles has enabled rapid upgrades in future OTA capabilities and user experience, significantly enhancing development efficiency. This digital platform can greatly improve production efficiency for the industry and rapidly enhance user experience.
We are continuously exerting efforts in these five major areas, alongside a focus on the vehicle Internet of Things (IoT) field, without going into detail, to support the upgrading development of China's intelligent electric vehicle industry.
Our cooperation operates under three modes: a standard parts mode, collaborating with numerous automotive companies; an HI (Huawei Inside) mode, providing comprehensive stack solutions, as seen in our collaboration with Changan Automobile and Arcfox; and a smart choice car mode, leveraging Huawei's experience and capabilities accumulated over the past decade to assist automakers, with current major partners including Saic Motor, Chery, BAIC Group, and JAC Motors. Our collaboration with BAIC Group on the S9 model, as announced by the Ministry of Industry and Information Technology, is aimed at creating a new benchmark. The delays in the launch and mass production of the Inquire World S7 by Chery, due to chip shortages and factory relocation, have impacted sales, but we anticipate a return to normalcy starting from April.
Our goal is not only to help automakers manufacture and sell good cars but also to establish an alliance for the Harmony Intelligent Driving ecosystem, based on our decade-long experience in 2C user experience product definition, our core technology and solution integration capabilities, as well as our expertise in high-end brand marketing, channels, retail, and service capabilities. We aim to empower automakers deeply with the capabilities accumulated by Huawei over the past decade, taking a step forward. We've tried it, and we believe it can bring value to our partners.
Many have asked if we can do more, given the tight constraints on manpower and resources. Like Huawei's approach in the telecom industry, we aim to establish a few flagship projects or pilot zones. However, with limited resources, we can only focus on building four such flagship projects at the moment. Going forward, many Chinese automotive companies possess strong capabilities. By utilizing the flagship project approach, we can provide them with valuable insights. Many of these companies already have robust capabilities and I believe that adopting Huawei's solutions and technologies can lead to successful industrial upgrades and transformations, as well as commercial success. Our cutting-edge technology should truly enhance user experiences, win consumers' love and trust, and drive commercial success.
Together with our partners, we aim to collectively develop the best technology and user experiences for the new energy industry. Collaborating with our supply chain partners, we will help elevate the brand image of automotive companies and facilitate the production of high-end products. However, the cost of our intelligent driving system is still relatively high. Due to various factors including supply chain issues, Huawei is currently facing sanctions, which affect our costs. Implementing our system in cars priced below 300,000 CNY poses some challenges. It's only viable for cars priced above 300,000 CNY to ensure profitability. However, selling cars above this price range requires strong brand support. Therefore, through our intelligent selection and partnership models, we aim to assist automotive manufacturers in selling mid-to-high-end cars successfully. Once we've achieved success in selling mid-to-high-end cars, Huawei's Car Business Unit (BU) can achieve a closed-loop system and generate good profits, turning losses into gains.
We expect Huawei's Car BU to turn losses into gains this year. The successful sales of high-end car models created in partnership with our collaborators will contribute significantly to this turnaround. The intelligent selection cars achieved profitability in the first three months, bringing our Car BU close to breaking even. We anticipate that from April onwards, we should be able to achieve profitability and maintain a positive trend, as continual losses are unsustainable. We are fully committed to supporting Chinese automotive companies in achieving commercial success in the era of intelligence, electrification, and connectivity in the automotive industry.
Thank you all!
