At the end of 2021, the AITO brand released its first model, the M5. This car is not only equipped with Huawei’s electric drive, Hongmeng cockpit, and other core components, and even the appearance and interior design are deeply involved in the Huawei team.
Since it is selling incremental parts, why should it be deeply involved in the R&D and manufacturing of vehicles? And, can the Wenjie M5, which Huawei is deeply involved in, really get a share of the Chinese smart electric vehicle market, which is full of experts?
Just when these questions were flying all over the sky, Yu Chengdong, Huawei’s executive director, terminal BG, and smart car solution BU CEO, stood up – at a communication meeting held a few days ago, Yu Chengdong had an in-depth dialogue with a few media such as Chedongxi.
Because the mobile phone business was sanctioned by the United States, Huawei’s consumer business has experienced great difficulties in the past two years, but Yu Chengdong has not lost his confidence.
Yu Chengdong frankly introduced Huawei’s core play and goals in the automotive field. For example, Huawei’s goal remains unchanged, which is to help car companies build and sell good cars. At the same time, it also called out an extremely challenging development goal – the AITO brand goal is to sell 30,000 units per month.
In Yu Chengdong’s words, Che Dongxing saw his sincerity and enthusiasm in embracing the auto business, but more of it was stubbornness and confidence to be the world’s number one.
01. Insist on not building cars and positioning multiple models to help car companies build good cars
“We don’t build cars, we help car companies build good cars.” At the beginning of the exchange, Yu Chengdong bluntly explained the core starting point of Huawei’s automotive business.
According to him, in the AITO brand, Huawei’s role is still a supplier, but this cooperation model is relatively new – suppliers are more involved and deeper.
Specifically, Xiaokang is responsible for vehicle R&D, manufacturing, etc., while the Huawei team fully empowers it in parts, design, user experience, quality management, and channels. The two teams work together.
In addition, Huawei also has a HI model, that is, car companies choose a full set of Huawei components and systems including Hongmeng cockpit, electric drive, and ADS system to build models, but Huawei only provides components, and product definition and R&D are dominated by car companies. The cooperation of BAIC Polar Fox is this model.
Of course, car companies can also choose Huawei’s single components or services, such as in-vehicle communication modules, millimeter-wave radar, lidar, MDC computing platform, electric drive system, etc. In this regard, it can be said that almost all domestic mainstream car companies are Huawei’s partners.
02. The AITO brand will sell 30,000 a month and there are two cars on the road
Although there are various cooperation models between car companies and Huawei, the one that best represents or shows the strength of Huawei’s automotive business is obviously the Huawei Smart Selection model.
AITO is the first attempt at this model, and Yu Chengdong has high hopes for it. According to its introduction, AITO will launch two new cars in 2022, one is the pure electric version of the M5, and the other is a medium and large SUV.
“Relying on these three new cars, I hope that the monthly sales of AITO will exceed 30,000 units. This year, it will be able to challenge the sales target of 300,000 units. Next year, I hope to work with partners to challenge the sales of one million units.” When it comes to sales expectations, Yu Chengdong gave this data.
Yu Chengdong, who has managed hundreds of billions of dollars in business, has clearly set a very high goal for the auto business. The reason why Yu Chengdong dares to make such a decision is closely related to his development philosophy and past successful experience.
Previously, he put forward the development concept of “positioning determines status, vision determines realm”, that is, if you pursue the second-rate level, you may not be able to achieve the third-rate or fourth-rate. If you pursue the first, sooner or later you will become the first.
During the interview, when talking about the user experience of M5 and empowering partners, Yu Chengdong put forward the goal of being “world-first”. It can be seen that in the development of the automobile business, he is still resolutely implementing this concept.
In terms of achieving the goal, Yu Chengdong and the Huawei Consumer BG in charge of him have indeed won many victories.
The most famous is in 2015 when Huawei’s consumer business started when the consumer BG set a goal of achieving a revenue of 100 billion US dollars in 2020. But under the leadership of Yu Chengdong, the goal was accomplished ahead of schedule in 2018, becoming a legend in the technology circle.
03. The core components of smart cars are fully deployed and the terminal BG capacity is sufficient
After all, mobile phones and cars are fundamentally different. Can Huawei’s successful experience in the mobile phone or consumer field really support its ambition to sell 300,000 units in 2022 and one million units in 2023?
When the perspective is raised, it can be seen that Yu Chengdong’s confidence is not just past successful experience and a development concept. His confidence actually comes from Huawei’s comprehensive layout in the field of smart cars over the years, as well as the comprehensive ability accumulation of the consumer BG team in industrial design, user experience creation, and quality management.
Over the years, Huawei’s automotive business started with communication modules and gradually expanded to sensors, operating systems, cockpit and autonomous driving chips, electric drives, autonomous driving solutions, and many other fields. It has also established a smart car solution BU to focus on automotive solutions. The company provides incremental components.
Based on the long-term accumulation in radio, optical communication, chips, AI, operating systems, software algorithms, etc., the various components and systems developed by Huawei Smart Car BU are at the top level in the industry. For example, Huawei’s ADS high-level autonomous driving is the second company in the world after Tesla that dares to publicly demonstrate the city’s point-to-point L2 autonomous driving capabilities.
The product line of Huawei Consumer BG covers many categories such as mobile phones, tablets, smart TVs, etc., and has a good sales performance in many countries around the world. By conquering the Chinese and global markets, consumer BG has accumulated experience in the design, R&D, manufacturing, and sales of high-end smart devices.
A smart electric vehicle is a smart terminal with wheels. Huawei holds the core components of smart cars in one hand and the R&D experience of smart devices in the other. The combination of the two can empower car companies, and naturally, they can create competitive high-quality models.
Coupled with Huawei’s thousands of sales stores in the core areas of many cities across the country, it is not a problem to sell excellent models.
All of this is the real confidence that Yu Chengdong dared to set this grand goal.
04. Huawei must succeed in its last stand
Yu Chengdong said frankly in the communication that after Huawei was sanctioned, the shipments of high-end mobile phones dropped sharply because of the lack of chips, which greatly reduced the revenue scale of consumer BG.
Participating in the rapidly developing smart car industry is obviously the key to making up for the decline in consumer BG revenue and even making it a new leap forward.
“Huawei has a strong retail system. If you don’t use it, it will be a waste. Helping car manufacturers to sell cars and helping partners achieve business success will also drive the large-scale sales of our car BU parts.” Regarding the operation logic of the entire automobile business, Yu Chengdong Says so.
In addition, as the largest terminal in the IoT, smart cars can also grow into a smart travel ecosystem with the increase in sales, improving the user experience of Huawei’s other terminals. For example, Huawei mobile phones and watches can control the car. Navigation and Changlian video calls in the car can be seamlessly connected with mobile phones and tablets. Accounts and experiences can also be connected to each other. “This is a huge advantage of our Huawei ecosystem.” Yu Chengdong commented.
Whether it is from the general development trend of the industry, or Huawei’s own ability accumulation and ecology, the development of smart car business – helping car companies to build and sell good cars is not only the most suitable way for Huawei’s consumer BG to rise but also in the United States. A breakthrough path that must be chosen under the shadow of sanctions.
For Yu Chengdong, who runs Huawei’s consumer BG and auto business, success is a must. Whether it is from Yu Chengdong’s eyes, words, or the results of the Huawei team, Huawei’s chances of winning are not small.