Chinese multinational technology company, Huawei, which is the world’s largest telecommunications equipment manufacturer and the second-largest manufacturer of smartphones globally, are planning a foray into electric vehicle manufacturing with strong realistic ambitions to launch its first model this year.
Two sources reportedly told Reuters that Huawei Technologies Co Ltd are in talks with state-owned automaker, Changan Automobile and several other automobile manufacturers to utilise their car plants in producing their vehicles.
One of the sources authoritatively added that Huawei are also having discussions with Beijing-backed BAIC Group’s BluePark New Energy Technology to fast track the productions.
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BUOYED BY WORLDWIDE SANCTIONS
This expansion into the automotive industry has come about following the tech giants struggles as a result of heavy sanctions imposed by the US government and authorities under suspicion of involvement by the smartphone manufacturers with the Chinese government to spy on other countries and companies.
Although Huawei remain a best-seller worldwide, its smartphones are not marketed in the US after the government added them into the Bureau of Industry and Security Entity List in May 2019, effectively blacklisting them from US communication networks. This made it impossible for Google to collaborate with any phone manufactured after that date, with the tech giant tagging Huawei as “uncertified”, and unable to “utilise Google apps and services”, a move which drastically affected the company’s revenue. Google also discouraged users from sideloading apps on Huawei’s smartphones as their security might be compromised.
Huawei had affirmed to suppliers that orders for its smartphones is expected to drop by around 60% in 2021 from 2020’s figures of 189 million to 70 million as a result of US sanctions. This was preceded by Huawei dropping to fifth place in global phone sales for the fourth quarter of 2020, a decline of 41.1% from one year prior.
In February 2018, FBI Director Chris Wray warned against the purchase of Huawei phones, which factored in Best Buy severing its partnership with the company one month later, following in the footsteps of the world’s largest telecommunications company, AT&T.
US are not the only authorities to have restricted Huawei’s network outreach, with Sweden banning any installation of Huawei 5G on their territory. In October 2020, the UK Parliament cited “clear evidence of national significance” that Huawei had colluded with the Chinese government. Other countries like India, Canada, Brazil have also taken significant steps to dissociate themselves from the company.
A spokesperson for Huawei however routinely denied the company’s foray into the automotive industry,
“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 sources also revealed that the head of Huawei’s consumer business group, who was instrumental in the company’s mesmeric projection to one of the world’s leading smartphone producers, will be moved to the EV arm of production in hopes of similar achievements.
ANOTHER SUCCESS STORY?
Huawei have proven successful when diversifying into other sectors as they began as phone manufacturers before advancing into telecommunication equipment productions in the late 20th century to help develop China. In 2012, they eventually replaced Ericsson as the world’s largest telecommunications equipment manufacturer, with dozens of country relying on them to build latest telecom networks like the most recent 5G.
The EV sector has experienced a sizeable growth in recent years due to a global demand for clean energy, especially in China, where energy-related emissions of carbon dioxide have skyrocketed by 80 percent in the years period between 2005 and 2019, a contrasting comparison with the US who witnessed a 15 percent drop in the same time frame.
Huawei has been developing a number of technologies for EVs for years including in-car software systems, sensors for automobiles and 5G communications hardware, spread over partnerships with automakers such as Daimler AG, General Motors Co and SAIC Motor.
This has seen the company bolster their engineering ranks for auto-related technologies since 2018.
The company are expected to unveil their first EV model later this year.
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