By ZHOU Shuqi

Huawei and Changan Automobile are to establish a new joint venture in intelligent driving systems and incremental components. Changan and its affiliates will hold no more than 40 percent of the new company.

The new company will help Huawei address financial issues in its automotive business, reduce losses, and expand cooperation, alleviating concerns from automotive partners.

Huawei may not compete with the new company and all automotive business will be done through the new company. It is currently unclear whether the new company will become the sole carrier of Huawei’s smart automotive business, and more official disclosures are awaited.

The JV’s business includes intelligent driving, smart cabins, digital platforms and intelligent car lights. Huawei will provide technology, assets and personnel.

The new company will gradually open equity to Huawei’s existing partner automakers and investors. According to CITIC Securities, the most significant winners may be Changan Auto’s Avatr and Deepal EVs, which depend on the HarmonyOS ecosystem.

Among automakers, Changan Auto is one of Huawei’s closest partners. In November last year, Huawei, Changan Auto and CATL launched the Avita brand, with two models currently on the market.