Recently, Reuters learned from three people familiar with the matter that Huawei has been communicating with Mercedes-Benz and Audi to discuss whether the other parties are interested in investing in its newly established smart car software and parts company.
In fact, news came out at the end of November that Huawei would sell shares to investors including Changan Automobile, with a valuation of up to 250 billion yuan ($34.67 billion). Changan Automobile and its ultimate parent, China Ordnance Equipment Group Co., Ltd., are considering acquiring about 35% and 5% of the new company respectively. Potential minority shareholders include FAW Group and Dongfeng Motor Group, which are also in in-depth negotiations with Huawei to acquire up to 5% of their shares.
According to sources, Huawei has held preliminary negotiations with Mercedes-Benz in recent weeks. Mercedes-Benz can obtain 3%-5% of the shares, and the specific valuation is subject to negotiation. However, sources added that Mercedes-Benz has not shown much interest. It does not want to hand over software development to suppliers, but takes it into its own hands to maintain the tone of its high-end brand.
There is currently no news about Audi’s interest. However, Audi and Huawei are planning to cooperate to develop autonomous driving technology for Audi’s future models. This technology will be installed on FAW Audi’s products starting in 2025. Coincidentally, not long ago, the Shenzhen Municipal People’s Government signed a strategic cooperation agreement with China FAW Group Co., Ltd. According to the agreement, the two parties will carry out strategic cooperation in key areas such as forward-looking research and development, overseas automobile sales, and ecological construction. This signing does not rule out the possibility of deepening cooperation between FAW and Shenzhen company Huawei.
